Professional Documents
Culture Documents
Area covered for the project while doing job also was very large and
it
was
very
difficult
to
correlate
two
different
So above challenges some time forced me to leave the project but any how
I did my project in all circumstances. Basically in this project I analyzed
that-
Industry introduction
The Indian Banking industry, which is governed by the Banking
Regulation Act of India, 1949 can be broadly classified into two major
categories, non-scheduled banks and scheduled banks. Scheduled banks
comprise commercial banks and the co-operative banks. In terms of
ownership, commercial banks can be further grouped into nationalized
banks, the State Bank of India and its group banks, regional rural banks
and private sector banks (the old/ new domestic and foreign). These
banks have over 67,000 branches spread across the country in every city
and
villages
of
all
nook
and
corners
of
the
land.
of
growth.
them
to
save
on
manpower
costs.
During the year 2000, the State Bank Of India (SBI) and its 7 associates
accounted for a 25 percent share in deposits and 28.1 percent share in
credit. The 20 nationalized banks accounted for 53.2 percent of the
deposits and 47.5 percent of credit during the same period. The share of
foreign banks (numbering 42), regional rural banks and other scheduled
commercial banks accounted for 5.7 percent, 3.9 percent and 12.2
percent respectively in deposits and 8.41 percent, 3.14 percent and
12.85 percent respectively in credit during the year 2000.about the detail
of the current scenario we will go through the trends in modern economy
of the country.
Current Scenario:
The industry is currently in a transition phase. On the one hand, the
PSBs, which are the mainstay of the Indian Banking system are in the
process of shedding their flab in terms of excessive manpower, excessive
non Performing Assets (Npas) and excessive governmental equity, while
on the other hand the private sector banks are consolidating themselves
3
mergers
and
acquisitions.
PSBs, which currently account for more than 78 percent of total banking
industry assets are saddled with NPAs (a mind-boggling Rs 830 billion in
2000), falling revenues from traditional sources, lack of modern
technology and a massive workforce while the new private sector banks
are forging ahead and rewriting the traditional banking business model
by way of their
sheer innovation and service. The PSBs are of course currently working
out challenging strategies even as 20 percent of their massive employee
strength has dwindled in the wake of the successful Voluntary
Retirement
Schemes
(VRS)
schemes.
The private players however cannot match the PSBs great reach, great
size and access to low cost deposits. Therefore one of the means for them
to combat the PSBs has been through the merger and acquisition (M& A)
route. Over the last two years, the industry has witnessed several such
instances. For instance, HDFC Banks merger with Times Bank Icici
Banks acquisition of ITC Classic, Anagram Finance and Bank of
Madurai. Centurion Bank, Indusind Bank, Bank of Punjab, Vysya Bank
are said to be on the lookout. The UTI bank- Global Trust Bank merger
however opened a pandoras box and brought about the realization that
all was not well in the functioning of many of the private sector banks.
rationalized in Q1FY02 may also pave the way for foreign banks taking
the
M&
route
to
acquire
willing
Indian
partners.
to
participation,
provide
invest
fee-based
in
an
insurance
insurance
services
company
without
for
risk
providing
infrastructure and services support and set up of a separate jointventure insurance company with risk participation.
16.2
percent
as
against
14.6
percent
year
ago.
SCBs slowed down to 15.6 percent in FY01 against 23 percent a year ago.
The industrial slowdown also affected the earnings of listed banks. The
net profits of 20 listed banks dropped by 34.43 percent in the quarter
ended March 2001. Net profits grew by 40.75 percent in the first quarter
of 2000-2001, but dropped to 4.56 percent in the fourth quarter of 20002001.
On the Capital Adequacy Ratio (CAR) front while most banks managed to
fulfill the norms, it was a feat achieved with its own share of difficulties.
The CAR, which at present is 9.0 percent, is likely to be hiked to 12.0
by
the
year
2004
based
on
the
Basle
Committee
recommendations. Any bank that wishes to grow its assets needs to also
shore up its capital at the same time so that its capital as a percentage of
the risk-weighted assets is maintained at the stipulated rate. While the
IPO route was a much-fancied one in the early 90s, the current scenario
doesnt
look
too
attractive
for
bank
majors.
Interest
Rate
Scene
The two years, post the East Asian crises in 1997-98 saw a climb in the
global interest rates. It was only in the later half of FY01 that the US Fed
cut interest rates. India has however
remained more or less insulated. The past 2 years in our country was
characterized by a mounting intention of the Reserve Bank Of India (RBI)
to steadily reduce interest rates resulting in a narrowing differential
between
global
and
domestic
rates.
The RBI has been affecting bank rate and CRR cuts at regular intervals
to improve liquidity and reduce rates. The only exception was in July
2000 when the RBI increased the Cash Reserve Ratio (CRR) to stem the
7
in
squeezed
margins
for
the
banks
in
general.
Governmental Policy:
After the first phase and second phase of financial reforms, in the 1980s
commercial banks began to function in a highly regulated environment,
with administered interest rate structure, quantitative restrictions on
credit flows, high reserve requirements and reservation of a significant
proportion of lendable resources for the priority and the government
sectors. The restrictive regulatory norms led to the credit rationing for
the private sector and the interest rate controls led to the unproductive
use of credit and low levels of investment and growth. The resultant
financial repression led to decline in productivity and efficiency and
erosion of profitability of the banking sector in general.
This was when the need to develop a sound commercial banking system
was
felt.
This
was
worked
out
mainly
with
the
help
of
the
to
access
the
markets
to
shore
up
their
Cars.
in
the
near
future.
of
FDI
investment.
10
11
of
India
limited(ISIL),
national
securities
depository
Milestones
12
Act
in
September
2000,
IDBI
divested
51%
of
its
January 1992: Accessed domestic retail debt market for the first
time with innovative Deep Discount Bonds; registered pathbreaking success.
13
of
opening
up
domestic
banking
sector
to
private
July 1995: Made Initial Public Offer of Equity and raised over
Rs.2000 crore, thereby reducing Government stake to 72.14%.
Management
Company
Ltd.,
erstwhile
100%
14
information
and
professional
services
to
15
July
2004:
The
Industrial Development
Bank
(Transfer
of
Undertaking and Repeal) Act 2003 came into force from July 2,
2004.
July 2004: The Boards of IDBI and IDBI Bank Ltd. take inprinciple decision regarding merger of IDBI Bank Ltd. with
proposed Industrial Development Bank of India Ltd. in their
respective meetings on July 29, 2004.
16
17
IDBI BANK
DEVELOPMENT BANK.
RETAIL BANKING
SAVING ACCOUNT
CURRENT ACCOUNT
PERSONAL SAVING
CORPORATE SAVING
INVESTMENT
18
19
Chairman
President
Vice president
Finance
Vice president
H. R.
Vice president
Marketing
Vice president
Operations
Regional Head
Zonal Head
Divisional Sales
Manager
Territory In charge
20
Research Methodology
Objective of the study
Project study which is being conducted by me for the last two month is
not only a formality for the fulfillment of the two year full time Post
Graduate Diploma in Business Management. But being a management
student and a good employee I tried my best to extract best of the
information available in the market for the use of society and people. The
objectives have been classified by me in this project form personal to
professional, but here I am not disclosing my personal objective which
have been achieved by me while doing the project. Only professional
objectives which are being covered by me in this project are as following-
21
22
23
Technological Tools
Ms- Excel
Ms-Access
Ms-Word
Above application software of Microsoft helped me a lot in making project
more interactive and productive.
24
25
Statistical Analysis
In this segment I will show my findings in the form of graphs and charts.
All the data which I got form the market will not be disclosed over here but
extract of that in the form of information will definitely be here.
Detail:
Size of Data
: 250
Area
: Saket
Type of Data
: 1. Primary
Industry
: Banking
Respondent
2. Secondary
: Customers
26
NO. OF RESPONSE
25
46
34
23
21
22
24
55
50
40
30
NO. OF RESPONSE
20
10
0
20
-2
5
25
-3
0
30
-3
5
35
-4
0
40
-4
5
45
-5
0
50
60 -6
-A 0
BO
VE
RESPONSES
60
AGE GROUP
27
TYPE OF BANK
PRIVATE
PUBLIC
PRIVATE/PUBLIC
DON'T KNOW
RESPONSES
50
45
100
55
28
33%
RESPONSES
75%
25%
95%
33%
22%
22%
EFFICIENCY
75%
INTERNET
BANKING/ATMs
PRODUCT RANGE
NETWORK
95%
25%
PHONE BANKING
29
% OF SHARE
30%
15%
25%
10%
5%
5%
10%
30
% OF SHARE
50%
5%
25%
2%
5%
10%
3%
31
IDBI
ICICI
SBI
PNB
HSBC
PRODUCT
ADVERTISMENT
MANPOWER
NET-BANKING
PHONE BANKING
INVESTMENT SCHEME
NETWORK
CREDIBILITY
20%
3%
10%
3%
10%
5%
2%
20%
15%
45%
50%
50%
40%
25%
40%
10%
30%
15%
2%
10%
5%
50%
40%
40%
15%
20%
3%
12%
5%
10%
5%
20%
10%
7%
25%
8%
30%
5%
3%
5%
CANAR
A BANK
10%
10%
10%
17%
10%
5%
10%
5%
32
POSITIVE RESPONSE
100
67
43
40
33
Findings
1. The credibility of IDBI bank is good in comparison to its
competitors
4. The advertisement of the bank was very effective from the first day
of its airing till the fifth day and there after it starts declining.
34
in Saket
35
Recommendations
1. Since there is only two branch of IDBI bank and only three atms in
Saket, so it is necessary for IDBI bank to open more branches and
install more atms to serve the vast market of saket especially.
2. More resources should be allocated in the market of Saket as there
is big untapped market in saket, so it becomes necessary for IDBI
bank for taking an edge over the competitors.
3. A short advertising campaign in Saket has produced good results in
a short span of times, so to gain long term benefits is very
necessary for IDBI bank to carry on this campaign with more
intensity.
4. Besides opening more branches it should also look for opening some
extension counter in Kutub near meherauli and one in Khanpur.
36
NAME
SEX: MALE/FEMALE
ADDRESS:...
CITYPIN
CODE....
CONTACT NO.
37
NO
2. IDBI BANK IS A
PRIVATE BANK
PRIVATE/PUBLIC BANK
PUBLIC BANK
DONT KNOW
EFFICENCY
MANPOWER
INTERNET BANKING/ATMs
NETWORK
PRODUCT RANGE
PHONE BANKING
5. YOU WOULD NOT LIKE TO BE A CUSTOMER BANK BECAUSE6. NAME THE BANK WHICH COMES IN YOUR MIND AT VERY FIRST AND
WHY?
.
7. DO YOU THINK IDB IBANK IS A SAFE PLACE FOR YOUR MONEY?
YES
NO
NO
DISSATISFIED
VERY
DISAT.
38
SBI
ICICI
PNB
OTHER
NO
12. WHEN DID YOU LAST SEE THE ADVERTISEMENT OF IDBI BANK?
0-5 DAYS BACK
MORE THAN 15
DAYS BACK
13.
SAKET?
39
40