SYNOPSIS ON THE STUDY OF HOME LOANS

(In respect of State Bank of India)

INTRODUCTION
Need for the study:
Retail banking has been popular segment to enter into for many banks. In the retail banking,
housing sector has been most promising segment which is promising a Comprehensive growth
rate of about 30 per cent for the next five years. With the government keen on infrastructure
development and announcing various tax Sops housing loan segment has been a tempted area for
many banks to enter into housing sector can be bifurcated into organized and unorganized
segments with the unorganized segments accounting for over 75 per cent of the housing units
constructed.
During the past 4 5 years the housing sector helped by the growing housing finance industry
has witnessed significant developments.
Housing Finance Evaluation:
Housing Development Finance Corporation (HDFC) was the first housing finance Company to
setup operations in India in 1977. After the National Housing Bank Act, 1987, was passed NHB
came into existence as a Subsidiary of the Reserve Bank of India (RBI) to regulate housing
finance companies and provide them with refinancing to supplement their fund requirements.
Public sector banks were allowed to provide housing loans directly to retail clients only in 1988.
The home loan scheme of the State Bank of India is "The most Preferred Home
Loan Provider". It has been a successful product launched by banks retail assets division.
The home loan disbursement procedure followed by the bank has been undertaken.

The various documents involved and the details in taking a home loan have also been highlighted
as a part of my study.
The home loan segment has number of added extensions to its portfolio because of increased
competitiveness among the HFIs. An attempt has been made to understand the various
extensions and new concepts and the benefits extended by the banks.

About the Company

State Bank of India is an Indian multinational, public sector banking and financial
services company. It

is

a government-owned

corporation with

its

headquarters

in Mumbai, Maharashtra. As of 2014-15, it has assets of INR 20,48,080 crores and

16,333 branches, including 191 foreign offices spread across 36 countries, making it the
largest banking and financial services company in India by assets.
State Bank of India is one of the Big Four banks of India, along with ICICI Bank, Bank of
Baroda and Punjab National Bank.
The bank traces its ancestry to British India, through the Imperial Bank of India, to the
founding, in 1806, of the Bank of Calcutta, making it the oldest commercial bank in
the Indian Subcontinent. Bank of Madras merged into the other two "presidency banks"
in British India, Bank of Calcutta and Bank of Bombay, to form the Imperial Bank of
India, which in turn became the State Bank of India. Government of India owned the
Imperial Bank of India in 1955, with Reserve Bank of India (India's Central Bank) taking
a 60% stake, and renamed it the State Bank of India. In 2008, the government took over
the stake held by the Reserve Bank of India.
State Bank of India is a regional banking behemoth and has 20% market share in
deposits and loans among Indian commercial banks.

Domestic presence
SBI has nearly 16000 branches in India presently, of which 9,851 (66%) were in Rural
and Semi-urban areas. In the financial year 2012-13, its revenue was INR 200,560
Crores (US$36.9 billion), out of which domestic operations contributed to 95.35% of
revenue. Similarly, domestic operations contributed to 88.37% of total profits for the
same financial year.
Under the Pradhan Mantri Jan Dhan Yojana of financial inclusion launched by
Government in August 2014, SBI held 11,300 camps and opened over 30 lakhs
accounts by September, which included 21.16 lakh accounts in rural areas and 8.8 lakh
accounts in urban areas.

International presence
As of 2014-15, the bank had 191 overseas offices spread over 36 countries having the
largest presence in foreign markets among domestic banks. [7] It has branches of the
parent in Singapore, Moscow, Colombo, Dhaka, Frankfurt, Hong
Kong, Tehran, Johannesburg,London, Los Angeles, Male in
the Maldives, Muscat, Dubai, New York, Osaka, Sydney, and Tokyo. It has offshore
banking units in theBahamas and Bahrain, and representative offices in
Myanmar , Bhutan and Cape Town.

OBJECTIVE OF THE STUDY OF HOME LOANS

The study was mainly conducted to understand the concept of home loan scheme and the
eligibility criteria of the customers.

The study is done to understand the documents involved in the home loan scheme and the
repayment methodology adopted by various banks and the HFCs (Housing Finance
Corporations).

The innovative home loan schemes and the risk capturing mechanism adopted by the
HFIs and the future of the home loan segment has been undertaken as a part of this study

RESEARCH METHODOLOGY
The type of study is descriptive.
Primary data and Secondary data are collected with help of bank employees.
Through the help of web and past 2-5 years penetration rate and questionnaire.

Limitations of study:

The study was restricted in understanding the home loan as concept so the practical
implications of the study have been difficult.

The innovative features of the various HFIs as part of their home loan schemes but is not
a comprehensive study of their home loan schemes.

The Take Over home loans of high interest rate for low interest rates and their inherent
risks on the banks lending profile has not been undertaken in the study.