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A
RESEARCH PROJECT
ON
Customer Delight at IDBI bank at Bardoli
SUBMITTED TO:
GLS INSTITUTE OF COMPUTER TECHNOLOGY
GUJARAT TECHNOLOGICAL UNIVERSITY
AHMEDABAD
GUIDED BY:
PROF.BHARGAV MODI
SUBMITTED BY:
JIGESH CHAUDHARI
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GLS Institute of Computer technologyOpp, Law Garden, Ellis bridge, Ahmadabad 380006, India
Phone : 26447636 Fax: 26445958Website: www.nribm.org
CERTIFICATE This is to certify that Mr. Jigeshkumar.B.Chaudhari Roll
No.G1003 students of GLS Institute of Computer technology
have successfully completed their Summer Internship Project
on Customer delight at IDBI bank at Bardoli in partial
fulfilment for the requirements of the MBA programme ofGujarat Technological University.
This is their original work and has not been submitted
elsewhere.
Date: _________________Place: _________________
_________________Dr. Hitesh Ruparel
Director-in Charge
____________________Prof. Bhargav Modi
Assistant Professor& Project Guide
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Declaration
I hereby declare that the summer project report titled Customer delight at IDBI bank at
bardoli. Based on original piece of work done by me for the fulfilment of the award of
degree of Master of Business Administration and whatever information has been taken from
any sources had been duly acknowledge.
I further declare that the personal data & information received from any respondent during
survey has not been shared with any one and is used for academic purpose only.
Date: Jigesh Chaudhari
Place:
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Preface
In the growing global competition, the productivity of any business concern depends upon the
behavioural aspect of consumers. This topic deals with the customers perception towards
schedule of services charges offered by IDBI bank at Bardoli. This project report contains
five different chapters. The report begins with the research methodology taken up to conduct
the survey of customers.
The second chapter is the introduction of the Banking industry in India and facts file of bank
in India and also about schedules, public and private sector banks.
The third chapter includes about IDBI banks profile and its achievements, development and
recognition.
The fourth chapter includes comprehensive coverage of forecasting concepts and techniques
which shows the analysis of data through tabulation, computation and graphical
representation of data collected from survey.
The fifth chapter deals with the findings, suggestion & conclusion part which is very much
important after analysis is made.
As we know that only analysis and conclusion is not the end of a research, so in the sixth
chapter the recommendation part is covered which are made after a depth study of the
analysis part of thesis.
In each of the five chapters as described above, every chapter has been scheduled in a manner
so as to enable the reader to appreciate the contents easily. The report is supported by figures
and data wherever necessary with a view to assist the reader in developing a clear cut
understanding of the topic.
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Acknowledgement
The project is intended to give the reader a fair understanding of the various aspects of the
banks service schedule and about the basic factors that include and calculated to complete
the project report. The report is compiled in easy language to ensure proper reader
comprehension.
We wish to express our sincere gratitude to Dr. HITESH RUPAREL director sir and
PROF.BHARGAV MODI of GLS institute of computer technology for providing us an
opportunity to do our project work on CUSTOMER DELIGHT.
This project bears on imprint of many peoples. We sincerely thank for guidance and
encouragement in carrying out this project work we also wish to express our gratitude to the
officials and other staff members of IDBI BANK who rendered their help during the
period of our project work. Our special thanks to SIR RAKESH PATEL branch manager of
the bank.
We are obliged to him for providing us with a clear basis to start the project and for providing
valuable feedback during the course of this project without which the study would not have
been possible. We are also thankful to all concerned executives and staff members those who
are directly or indirectly involved in carrying out our project and have extended their able
guidance and cooperation in this project work.
Place: Ahmadabad
Date:
Executive summary
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Banking Industry which is basically my concern industry around which my project has to be
revolved is really a very complex industry. And to work for this was really a complex and
hectic task and few times I felt so frustrated that I thought to left the project and go for any
new industry and new project. Challenges which I faced while doing this project were
following-
Banking sector was quite similar in offering and products and because of that it was
very difficult to discriminate between our product and products of the competitors.
Target customers and respondents were too busy persons that to get their time and
view for specific questions was very difficult.
Sensitivity of the industry was also a very frequent factor which was very important to
measure correctly.
Area covered for the project while doing job also was very large and it was very
difficult to correlate two different customers/respondents views in a one.
Every financial customer has his/her own need and according to the requirements of
the customer product customization was not possible.
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-
What factors are really responsible for customers delight of IDBI Banks performance and
schedule of services compare to other public and private sector bank in this competitive era?
Table of contents
Sr. TOPIC PAGE
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NO. NO.
1 Research Methodology 1
2 2.1 Introduction to the Industry 6
2.2 From world wars independence 8
2.3 Post independence 9
2.4 Nationalisation of banks 9
2.5 Liberalization of banks 10
2.6 Banks in India 11
2.7 Facts file of banks in India 13
2.8 Public sector banks 14
2.9 Private sector banks 16
2.10 Indian banking industry 18
3 3.1 Introduction of company 19
3.2 History 20
3.3 Vision 21
3.4 Quality of products and services 21
3.5 IDBI bank business chart 22
3.6 Corporate opportunity 22
3.7 IDBI bank organizational chart 23
3.8 Board of directors 24
3.9 Recruitments 24
3.10 Management and organisation 25
3.11 Corporate social responsibility 25
3.12 Corporate governance 25
3.13 Milestones 25
3.14 Investor 28
3.15 Shareholders 29
3.16 Financial reporting and records 29
3.17 Health, safety and environment 29
3.18 National interest 29
3.19 Preamble 29
3.20 Competition 30
3.21 Equal rights 30
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3.22 Prohibited business 30
3.23 Public representation of the company and the group 31
3.24 Ethical standards 31
3.25 Securities Transactions and Confidential Information 31
3.26 Protection of Bank's assets 32
3.27 Significant developments during FY 2010-11 (April
March)
32
3.28 Competitors of IDBI bank 35
3.29 Top ten private bank of India 42
3.30 Pest analysis 45
3.31 SWOT analysis of IDBI bank 56
3.32 Five forces model 58
4 Data Interpretation and Analysis
4.1 Secondary data analysis 65
4.2 Primary data analysis 68
5 Testing of Hypothesis 108
6 Findings 111
7 Recommendations 113
8 Conclusion 114
9 Bibliography 115
Annexure 116
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List of tables
Sr.NO.
TABLE TITLE PAGENO.
1 2.2 From world war to independence 8
2 2.6 Banks in India 11
3 2.7 Facts file of banks in India 13
4 3.28.3.5 Literacy rate in India 53
5 4.3 Comparison of various banks schedule of service with
IDBI bank
101
4.3.1 Savings Account 101
4.3.2 Current Account 105
List of figures
Sr. NO. FIGURE TITLE PAGE NO.
1 2.10 Indian banking industry 18
2 3.4 IDBI bank business chart 22
3.5 IDBI organizational chart 23
3.6 Board of Directors 24
3.28 Pest Analysis 45
3.28.3.5 Literacy rate in India 54
3.30 Five forces model 59
3 4.2.1 Information about A/c 68
4.2.2 Name of bank 694.2.3 Types of A/c 70
4.2.4 Criteria 71
4.2.5 Use of A/c 72
4.2.6 Purpose of A/c 73
4.2.7.1 Ease of transaction 74
4.2.7.2 Process Clarity 75
4.2.7.3 Rate of interest 76
4.2.7.4 Documentation 77
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4.2.7.5 Time duration 78
4.2.7.6 Knowledge of staff 79
4.2.7.7 Repayment charges and processing charges 80
4.2.7.8 After sales services 81
4.2.8.1 Response of employee 82
4.2.8.2 Dealing in comfortable language 83
4.2.8.3 Location from house 84
4.2.8.4 Drinking water 85
4.2.8.5 Parking 86
4.2.8.6 Seating Arrangement 87
4.2.8.7 May I help you 88
4.2..8.8 Ease of locating 89
4.2.9 Aware about all service charges 90
4.2.10 Customers Satisfaction by banks service
charges
91
4.2.11 Compare with other banks charges 92
4.2.12.1 Ranking of SBI 93
4.2.12.2 Ranking of IDBI 94
4.2.12.3 Ranking of HDFC 95
4.2.12.4 Ranking of Indusind 96
4.2.12.5 Ranking of ICICI 97
4.2.12.6 Ranking of Axis 98
4.2.12.7 Ranking of Bank of Baroda 99
4.2.13 Charges should be free 100
4.2.14 Overall rating of bank 101
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Research Methodology
1.1 Introduction
Today it is fashionable to talk about the new economy. We hear that the business are
operating in globalize economy; things are moving at a nanosecond pace our market are
characterized by hyper competition and disruptive technologies are challenging every
business and so business must adopt to empower consumer. To become successful in such a
competitive environment the business organizations have to be customer oriented. Customers
need and want must be taken care of. Build customer and not only products. Customer
must be delighted. This information about the market could be collected by the way of proper
market survey. Rom the market survey we get the feed about the good or services of the
organization .For this purpose the said project work is undertaken.
The project was carried out for knowing study preferences of customers towards services
offered by IDBI bank. The second objective of the project was to study to study comparative
analysis of service charges of IDBI bank with other nationalise bank at Bardoli region. The
project was carried out in the market of Bardoli of Gujarat state.
IDBI Bank Ltd. is a Universal Bank with its operations driven by a cutting edge core Banking
IT platform. The Bank offers personalized banking and financial solutions to its clients in the
retail and corporate banking arena through its large network of Branches and ATMs, spreadacross length and breadth of India.
IDBI Bank Ltd. is today one of India's largest commercial Banks. For over 40 years, IDBI
Bank has essayed a key nation-building role, first as the apex Development Financial
Institution (DFI) (July 1, 1964 to September 30, 2004) in the realm of industry and thereafter
as a full-service commercial Bank (October 1, 2004 onwards). As a DFI, the erstwhile IDBI
stretched its canvas beyond mere project financing to cover an array of services that
contributed towards balanced geographical spread of industries, development of identified
backward areas, emergence of a new spirit of enterprise and evolution of a deep and vibrant
capital market. IDBI bank offered very convenient services to their customer for their better
customer satisfaction. The service charges offered by bank are very minimum compare to
other bank. This service differentiates IDBI bank from other bank.
While doing the project attempt was made to collect maximum information about the marker.
To get actual and correct information, it was not told retailers that the survey is conducted by
IDBI bank for the obvious reasons.
1.2 Research problem
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In this competitive market every bank is trying to come up with faster & convenient customer
service. IDBI bank offers very appropriate customer services and many service charges are
free to their customer compare to other bank. Apart from it the study shows the analysis of
the customers satisfaction towards banks service charges.
1.3 Scope of the Study
It will help us to enhance the knowledge.
This study will help in precision or exactness of result.
This will also help in doing quality survey and interpretation.
This will also help to find out the reliable techniques for data analysis.
1.4 Research methodology
Research is a process of arriving dependable solution to problems through planned and
systematic collection, analysis and interpretation of data. Methodology aims at making the
study systematic. The selection of methods for research work depends upon the nature of
problem. This is a kind of descriptive research that describes the state of affairs of the firm. In
this study, I am going to use primary and secondary data.
1.5 Objectives
Primary Objectives
To study the customer satisfaction at IDBI bank, Bardoli.
To study preferences of customers towards services offered by IDBI bank.
To know the awareness of customer towards service charges offered by IDBI bank.
Secondary Objectives
To study comparative analysis of service charges of IDBI bank with other nationalise
bank at bardoli region.
1.6 Literature review
To evaluate the service quality in banking in the Middle East and Qatar in particular, based
on different levels of customers perception regarding service quality.
In order to achieving higher levels of quality service in banking, banks should deliver higher
levels of service quality and in the present context customers perceptions are highest in the
level of infrastructure facilities of the bank, followed by timing of the bank, and return on
deposit. Owing to the increasing competition in banking, customer service is an important
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part and bank managers should be rethinking how to improve customer satisfaction with
respect to service quality.
In service industries, globally, the subject of service quality remains a critical one as
businesses strive to maintain a comparative advantage in the marketplace. Since financial
services, particularly banks compete in the marketplace with generally undifferentiated
products, and service quality becomes a primary competitive weapon (Stafford, 1996). It is
true that structural changes have resulted in banks being allowed a greater range of activities,
enabling them to become more competitive with non-bank financial institutions (Angur et al.,
1999). Currently, technological changes are causing banks to rethink their strategies for
services offered to both commercial and individual customers. Moreover, banks that excel in
quality service can have a distinct marketing edge since improved levels of service quality are
related to higher revenues, increased cross-sell ratios and higher customer retention (Bennett
and Higgins, 1993), and expanded market share (Bowen and Hedges, 1993). Moreover, the
banks understand that customers will be loyal if they can produce greater value than
competitors.
Research has indicated that service quality has been increasingly recognized as a critical
factor in the success of any business (Parasuraman et al., 1988) and the banking sector in this
case is not exceptional. Service quality has been widely used to evaluate the performance of
banking services (Cowling and Newman, 1995). The banks understand that customers will be
loyal if they receive greater value than from competitors (Dawes and Swailes, 1999) and on
the other hand, banks can earn high profits if they are able to position themselves better than
their competitors within a specific market (Davies et al., 1995). Therefore, banks need focus
on service quality as a core competitive strategy (Chaoprasert and Elsey, 2004). Moreover,
bank all over the world offer similar kinds of services, and try to quickly match their
competitors innovations. It can be noted that customers can perceive differences in the
quality of service (Chaoprasert and Elsey, 2004). Moreover, customers evaluate banks
performance mainly on the basis of their personal contact and interaction (Gronroos, 1990).
Defining service quality and its components in a form that is actionable in the workplace is an
important endeavour that any business company cannot take lightly. Moreover, many
scholars agree that service quality can be decomposed into two major dimensions (Gronroos,
1984; Lehtinen and Lehtinen, 1982). The first is referred to by Zeithaml et al. (1985) as
outcome quality and the second by Gronroos (1984) as technical quality. However, the
first dimension is concerned with what the service delivers and on the other hand, the second
dimension is concerned with how the service is delivered: the process that the customer wentthrough to get to the outcome of the service.
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By: Mohammed Husain and Shirley Leo Department of Accounting and Information
Systems, College of Business and Economics, Qatar University, Doha, Qatar
1.7 Research designThe research design used for the study is descriptive in nature.
1.8 Data collection source
Primary dataStructured Questionnaire.
Secondary dataInternet
Brochure of bank
1.9 Sample Plan
Population: Bardoli
Sampling unit: a Customer of IDBI bank in Bardoli
Sample size: 100
Sampling method: Convenience and judgmental Sampling
Time Period: 01/06/2011 to 15/07/2011
1.10 Hypothesis
Hypothesis is used to test the validity of the assumption. First of all the assumption is made
about the population parameter. Then sample data is collected, sample statistics is produced
and based on this information, it is decided how likely it is that the hypothesized population
parameter is correct. In short, the difference between the hypothesized value and the actual
value of the sample mean is determined and validity of the assumption is tested.
Hypothesis 1:
H0: Location is an important factor while dealing with IDBI bank.
H1: Location is not an important factor while dealing with IDBI bank.
Hypothesis 2:
H0: Enquiries are not handled properly.
H1: Enquiries are handled properly.Hypothesis 3:
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H0: Language of Staff members is not Customer friendly.
H1: Language of Staff members is not Customer friendly
1.11 Statistical test procedures used for analysis
Descriptive statistics were used for analysis and interpretation, one sample Z test for means
was used for hypothesis testing.
1.12 Expected contribution of the study and beneficiaries We as a student of management would be the most benefited. As this study will help
us to gain in depth and live knowledge and insight in to the subject matter.
The IDBI bank which showed interest to help us carry out this project would also be
benefited with the same.
The college would also benefit from the project report, as this would help the college
to build the reputation within the corporate world.
1.13 Limitations
1. The feedback received from the individuals is according to his perception, limited
exposure and personal knowledge level.
2. It is difficult to know whether respondents are true representatives or not.
3. Because of the time constraints, the sample size of the project and the area covered
was limited.
1.14 Time Budget
Topic Finalization: June 11, 2011
Research Proposal submission: June 16, 2011
Secondary Data collected submission: June 26, 2011
Primary Data collected submission: July 1, 2011
Data Analysis submission: July 8, 2011
Rough Draft of the project: July 10, 2011
1.15 A short write-up on the researcher
This Project report will be prepared by Jigesh Chaudhari. (G 1003)
Jigesh Chaudhari has done BBA from B. V. Patel institute of BMC & IT at Bardoli. And will
be opting for Finance in second year of M.B.A.
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Industry Profile
2.1 Introduction
Banking in India originated in the last decades of the 18th century. The first banks were The
General Bank of India which started in 1786, and the Bank of Hindustan, both of which are
now defunct. The oldest bank in existence in India is the State Bank of India, which
originated in the Bank of Calcutta in June 1806, which almost immediately became the Bank
of Bengal. This was one of the three presidency banks, the other two being the Bank of
Bombay and the Bank of Madras, all three of which were established under charters from the
British East India Company. For many years the Presidency banks acted as quasi-central
http://en.wikipedia.org/wiki/Bank_of_Bengalhttp://en.wikipedia.org/wiki/Bank_of_Bengalhttp://en.wikipedia.org/wiki/Bank_of_Bombayhttp://en.wikipedia.org/wiki/Bank_of_Bombayhttp://en.wikipedia.org/wiki/Bank_of_Madrashttp://en.wikipedia.org/wiki/Bank_of_Bombayhttp://en.wikipedia.org/wiki/Bank_of_Bombayhttp://en.wikipedia.org/wiki/Bank_of_Madrashttp://en.wikipedia.org/wiki/Bank_of_Bengalhttp://en.wikipedia.org/wiki/Bank_of_Bengal -
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banks, as did their successors. The three banks merged in 1921 to form the Imperial Bank of
India, which, upon India's independence, became the State Bank of India.
Indian merchants in Calcutta established the Union Bank in 1839, but it failed in 1848 as a
consequence of the economic crisis of 1848-49. The Allahabad Bank, established in 1865 and
still functioning today, is the oldest Joint Stock bank in India.(Joint Stock Bank: A company
that issues stock and requires shareholders to be held liable for the company's debt) It was not
the first though. That honor belongs to the Bank of Upper India, which was established in
1863, and which survived until 1913, when it failed, with some of its assets and liabilities
being transferred to the Alliance Bank of Shimla.
When the American Civil Warstopped the supply of cotton to Lancashire from
the Confederate States, promoters opened banks to finance trading in Indian cotton. With
large exposure to speculative ventures, most of the banks opened in India during that period
failed. The depositors lost money and lost interest in keeping deposits with banks.
Subsequently, banking in India remained the exclusive domain of Europeans for next several
decades until the beginning of the 20th century.
Foreign banks too started to arrive, particularly in Calcutta, in the 1860s.
The Comptoired'Escompte de Paris opened a branch in Calcutta in 1860
and another in Bombay in 1862; branches in Madras and Pondicherry,
then a French colony, followed. HSBC established itself in Bengal in 1869.
Calcutta was the most active trading port in India, mainly due to the trade
of the British Empire, and so became a banking center.
The first entirely Indian joint stock bank was the Oudh Commercial Bank,
established in 1881 in Faizabad. It failed in 1958. The next was the Punjab
National Bank, established in Lahore in 1895, which has survived to the
present and is now one of the largest banks in India.
http://en.wikipedia.org/wiki/Imperial_Bank_of_Indiahttp://en.wikipedia.org/wiki/Imperial_Bank_of_Indiahttp://en.wikipedia.org/wiki/Allahabad_Bankhttp://en.wikipedia.org/wiki/Alliance_Bank_of_Simlahttp://en.wikipedia.org/wiki/American_Civil_Warhttp://en.wikipedia.org/wiki/Lancashirehttp://en.wikipedia.org/wiki/Confederate_Stateshttp://en.wikipedia.org/wiki/Kolkatahttp://en.wikipedia.org/wiki/Mumbaihttp://en.wikipedia.org/wiki/Chennaihttp://en.wikipedia.org/wiki/Pondicheryhttp://en.wikipedia.org/wiki/HSBChttp://en.wikipedia.org/wiki/Bengalhttp://en.wikipedia.org/wiki/British_Rajhttp://en.wikipedia.org/wiki/Faizabadhttp://en.wikipedia.org/wiki/Punjab_National_Bankhttp://en.wikipedia.org/wiki/Punjab_National_Bankhttp://en.wikipedia.org/wiki/Lahorehttp://en.wikipedia.org/wiki/Imperial_Bank_of_Indiahttp://en.wikipedia.org/wiki/Imperial_Bank_of_Indiahttp://en.wikipedia.org/wiki/Allahabad_Bankhttp://en.wikipedia.org/wiki/Alliance_Bank_of_Simlahttp://en.wikipedia.org/wiki/American_Civil_Warhttp://en.wikipedia.org/wiki/Lancashirehttp://en.wikipedia.org/wiki/Confederate_Stateshttp://en.wikipedia.org/wiki/Kolkatahttp://en.wikipedia.org/wiki/Mumbaihttp://en.wikipedia.org/wiki/Chennaihttp://en.wikipedia.org/wiki/Pondicheryhttp://en.wikipedia.org/wiki/HSBChttp://en.wikipedia.org/wiki/Bengalhttp://en.wikipedia.org/wiki/British_Rajhttp://en.wikipedia.org/wiki/Faizabadhttp://en.wikipedia.org/wiki/Punjab_National_Bankhttp://en.wikipedia.org/wiki/Punjab_National_Bankhttp://en.wikipedia.org/wiki/Lahore -
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Around the turn of the 20th Century, the Indian economy was passing
through a relative period of stability. Around five decades had elapsed
since the Indian Mutiny, and the social, industrial and other infrastructure
had improved. Indians had established small banks, most of which servedparticular ethnic and religious communities.
The presidency banks dominated banking in India but there were also
some exchange banks and a number of Indianjoint stock banks. All these
banks operated in different segments of the economy. The exchange
banks, mostly owned by Europeans, concentrated on financing foreign
trade. Indian joint stock banks were generally under capitalized and
lacked the experience and maturity to compete with the presidency and
exchange banks. This segmentation let Lord Curzon to observe, "In
respect of banking it seems we are behind the times. We are like some old
fashioned sailing ship, divided by solid wooden bulkheads into separate
and cumbersome compartments."
The period between 1906 and 1911, saw the establishment of banks
inspired by the Swadeshi movement. The Swadeshi movement inspired
local businessmen and political figures to found banks of and for the
Indian community. A number of banks established then have survived to
the present such as India, Corporation, Indian Bank, Bank of Baroda, Canara
Bank and Central Bank of India.
The favor of Swadeshi movement lead to establishing of many privatebanks in Dakshina Kannada and Udupi district which were unified earlier
and known by the name South Canara (South Kanara) district. Four
nationalized banks started in this district and also a leading private sector
bank. Hence undivided Dakshina Kannada district is known as "Cradle of
Indian Banking"
2.2 From world wars to independence
http://en.wikipedia.org/wiki/Indian_rebellion_of_1857http://en.wikipedia.org/wiki/Joint_stock_companyhttp://en.wikipedia.org/wiki/Swadeshihttp://en.wikipedia.org/wiki/Indian_Bankhttp://en.wikipedia.org/wiki/Bank_of_Barodahttp://en.wikipedia.org/wiki/Canara_Bankhttp://en.wikipedia.org/wiki/Canara_Bankhttp://en.wikipedia.org/wiki/Central_Bank_of_Indiahttp://en.wikipedia.org/wiki/Dakshina_Kannadahttp://en.wikipedia.org/wiki/Udupi_districthttp://en.wikipedia.org/wiki/Indian_rebellion_of_1857http://en.wikipedia.org/wiki/Joint_stock_companyhttp://en.wikipedia.org/wiki/Swadeshihttp://en.wikipedia.org/wiki/Indian_Bankhttp://en.wikipedia.org/wiki/Bank_of_Barodahttp://en.wikipedia.org/wiki/Canara_Bankhttp://en.wikipedia.org/wiki/Canara_Bankhttp://en.wikipedia.org/wiki/Central_Bank_of_Indiahttp://en.wikipedia.org/wiki/Dakshina_Kannadahttp://en.wikipedia.org/wiki/Udupi_district -
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The period during the First World War(1914-1918) through the end of the Second World
War(1939-1945), and two years thereafter until the independence of India were challenging
for Indian banking. The years of the First World War were turbulent, and it took its toll with
banks simply collapsing despite the Indian economy gaining indirect boost due to war-related
economic activities. At least 94 banks in India failed between 1913 and 1918 as indicated in
the following table:
Years
Number
of
banks
Authorised
capital
Paid-up
Capital
that
failed(Rs. Lakh) (Rs. Lakh)
1913 12 274 351914 42 710 109
1915 11 56 5
1916 13 231 4
1917 9 76 25
1918 7 209 1
2.3 Post independence
Thepartition of India in 1947 adversely impacted the economies ofPunjab and West Bengal,
paralyzing banking activities for months. India's independence marked the end of a regime of
the Laissez-faire for the Indian banking. The Government of India initiated measures to play
an active role in the economic life of the nation, and the Industrial Policy Resolution adopted
by the government in 1948 envisaged amixed economy. This resulted into greater
involvement of the state in different segments of the economy including banking and finance.
The major steps to regulate banking included:
In 1948, the Reserve Bank of India, India's central banking authority, was nationalized, and it
became an institution owned by the Government of India.
In 1949, the Banking Regulation Act was enacted which empowered the Reserve Bank of
India (RBI) "to regulate, control, and inspect the banks in India."
The Banking Regulation Act also provided that no new bank or branch of an existing bank
could be opened without a license from the RBI, and no two banks could have common
directors.
http://en.wikipedia.org/wiki/First_World_Warhttp://en.wikipedia.org/wiki/Second_World_Warhttp://en.wikipedia.org/wiki/Second_World_Warhttp://en.wikipedia.org/wiki/Indian_independence_movementhttp://en.wikipedia.org/wiki/Economy_of_Indiahttp://en.wikipedia.org/wiki/Partition_of_Indiahttp://en.wikipedia.org/wiki/Punjab,_Indiahttp://en.wikipedia.org/wiki/West_Bengalhttp://en.wikipedia.org/w/index.php?title=Indian_independence_eovement&action=edit&redlink=1http://en.wikipedia.org/wiki/Laissez-fairehttp://en.wikipedia.org/wiki/Government_of_Indiahttp://en.wikipedia.org/wiki/Mixed_economyhttp://en.wikipedia.org/wiki/Reserve_Bank_of_Indiahttp://en.wikipedia.org/wiki/First_World_Warhttp://en.wikipedia.org/wiki/Second_World_Warhttp://en.wikipedia.org/wiki/Second_World_Warhttp://en.wikipedia.org/wiki/Indian_independence_movementhttp://en.wikipedia.org/wiki/Economy_of_Indiahttp://en.wikipedia.org/wiki/Partition_of_Indiahttp://en.wikipedia.org/wiki/Punjab,_Indiahttp://en.wikipedia.org/wiki/West_Bengalhttp://en.wikipedia.org/w/index.php?title=Indian_independence_eovement&action=edit&redlink=1http://en.wikipedia.org/wiki/Laissez-fairehttp://en.wikipedia.org/wiki/Government_of_Indiahttp://en.wikipedia.org/wiki/Mixed_economyhttp://en.wikipedia.org/wiki/Reserve_Bank_of_India -
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However, despite these provisions, control and regulations, banks in India except the State
Bank of India, continued to be owned and operated by private persons. This changed with the
nationalisation of major banks in India on 19 July 1969.
2.4 Nationalisation of banks
The RBI was nationalized on January 1, 1949 in terms of the Reserve Bank of India (Transfer
to Public Ownership) Act, 1948 (RBI, 2005b).[Referencewww.rbi.org.in]
By the 1960s, the Indian banking industry had become an important tool to facilitate the
development of the Indian economy. At the same time, it had emerged as a large employer,
and a debate had ensued about the possibility to nationalise the banking industry. Indira
Gandhi, the-then Prime Minister of India expressed the intention of the GOI in the annual
conference of the All India Congress Meeting in a paper entitled "Stray thoughts on Bank
Nationalisation." The paper was received with positive enthusiasm. Thereafter, her move was
swift and sudden, and the GOI issued an ordinance and nationalised the 14 largest
commercial banks with effect from the midnight of July 19, 1969. Jayaprakash Narayan, a
national leader of India, described the step as a "masterstroke of political sagacity." Within
two weeks of the issue of the ordinance, the Parliament passed the Banking Companies
(Acquisition and Transfer of Undertaking) Bill, and it received the presidential approval on 9
August 1969.
A second dose of nationalization of 6 more commercial banks followed in 1980. The stated
reason for the nationalization was to give the government more control of credit delivery.
With the second dose of nationalization, the GOI controlled around 91% of the banking
business of India. Later on, in the year 1993, the government merged New Bank of
India with Punjab National Bank. It was the only merger between nationalized banks and
resulted in the reduction of the number of nationalised banks from 20 to 19. After this, until
the 1990s, the nationalised banks grew at a pace of around 4%, closer to the average growth
rate of the Indian economy.
2.5 Liberalization of banks
In the early 1990s, the then Narsimha Rao government embarked on a policy
ofliberalization, licensing a small number of private banks. These came to be known as New
Generation tech-savvy banks, and included Global Trust Bank (the first of such new
http://en.wikipedia.org/wiki/State_Bank_of_Indiahttp://en.wikipedia.org/wiki/State_Bank_of_Indiahttp://www.rbi.org.in/http://www.rbi.org.in/http://en.wikipedia.org/wiki/Indian_economyhttp://en.wikipedia.org/wiki/Indira_Gandhihttp://en.wikipedia.org/wiki/Indira_Gandhihttp://en.wikipedia.org/wiki/Prime_Minister_of_Indiahttp://en.wikipedia.org/wiki/Government_of_Indiahttp://en.wikipedia.org/wiki/Nationalisationhttp://en.wikipedia.org/wiki/Jayaprakash_Narayanhttp://en.wikipedia.org/wiki/Parliament_of_Indiahttp://en.wikipedia.org/wiki/President_of_Indiahttp://en.wikipedia.org/w/index.php?title=New_Bank_of_India&action=edit&redlink=1http://en.wikipedia.org/w/index.php?title=New_Bank_of_India&action=edit&redlink=1http://en.wikipedia.org/wiki/Punjab_National_Bankhttp://en.wikipedia.org/wiki/Narsimha_Raohttp://en.wikipedia.org/wiki/Liberalizationhttp://en.wikipedia.org/wiki/State_Bank_of_Indiahttp://en.wikipedia.org/wiki/State_Bank_of_Indiahttp://www.rbi.org.in/http://en.wikipedia.org/wiki/Indian_economyhttp://en.wikipedia.org/wiki/Indira_Gandhihttp://en.wikipedia.org/wiki/Indira_Gandhihttp://en.wikipedia.org/wiki/Prime_Minister_of_Indiahttp://en.wikipedia.org/wiki/Government_of_Indiahttp://en.wikipedia.org/wiki/Nationalisationhttp://en.wikipedia.org/wiki/Jayaprakash_Narayanhttp://en.wikipedia.org/wiki/Parliament_of_Indiahttp://en.wikipedia.org/wiki/President_of_Indiahttp://en.wikipedia.org/w/index.php?title=New_Bank_of_India&action=edit&redlink=1http://en.wikipedia.org/w/index.php?title=New_Bank_of_India&action=edit&redlink=1http://en.wikipedia.org/wiki/Punjab_National_Bankhttp://en.wikipedia.org/wiki/Narsimha_Raohttp://en.wikipedia.org/wiki/Liberalization -
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generation banks to be set up), which later amalgamated with Oriental Bank of
Commerce, Axis Bank(earlier as UTI Bank), ICICI Bankand HDFC Bank. This move, along
with the rapid growth in the economy of India, revitalized the banking sector in India, which
has seen rapid growth with strong contribution from all the three sectors of banks, namely,
government banks, private banks and foreign banks.
The next stage for the Indian banking has been setup with the proposed relaxation in the
norms for Foreign Direct Investment, where all Foreign Investors in banks may be given
voting rights which could exceed the present cap of 10%, at present it has gone up to 74%
with some restrictions.
The new policy shook the Banking sector in India completely. Bankers, till this time, were
used to the 4-6-4 method (Borrow at 4%; Lend at 6%;Go home at 4) of functioning. The new
wave ushered in a modern outlook and tech-savvy methods of working for traditional banks.
All this led to the retail boom in India. People not just demanded more from their banks but
also received more.
Currently (2007), banking in India is generally fairly mature in terms of supply, product
range and reach-even though reach in rural India still remains a challenge for the private
sector and foreign banks. In terms of quality of assets and capital adequacy, Indian banks are
considered to have clean, strong and transparent balance sheets relative to other banks in
comparable economies in its region. The Reserve Bank of India is an autonomous body, with
minimal pressure from the government. The stated policy of the Bank on the Indian Rupee is
to manage volatility but without any fixed exchange rate-and this has mostly been true.
With the growth in the Indian economy expected to be strong for quite some time-especially
in its services sector-the demand for banking services, especially retail banking, mortgages
and investment services are expected to be strong. One may also expect M&As, takeovers,
and asset sales.
In March 2006, the Reserve Bank of India allowed Warburg Pincus to increase its stake in
Kotak Mahindra Bank (a private sector bank) to 10%. This is the first time an investor has
been allowed to hold more than 5% in a private sector bank since the RBI announced norms
in 2005 that any stake exceeding 5% in the private sector banks would need to be vetted by
them.
http://en.wikipedia.org/wiki/Axis_Bankhttp://en.wikipedia.org/wiki/UTI_Bankhttp://en.wikipedia.org/wiki/ICICI_Bankhttp://en.wikipedia.org/wiki/HDFC_Bankhttp://en.wikipedia.org/wiki/Economy_of_Indiahttp://en.wikipedia.org/wiki/Indiahttp://en.wikipedia.org/wiki/Retail_bankinghttp://en.wikipedia.org/wiki/Axis_Bankhttp://en.wikipedia.org/wiki/UTI_Bankhttp://en.wikipedia.org/wiki/ICICI_Bankhttp://en.wikipedia.org/wiki/HDFC_Bankhttp://en.wikipedia.org/wiki/Economy_of_Indiahttp://en.wikipedia.org/wiki/Indiahttp://en.wikipedia.org/wiki/Retail_banking -
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In recent years critics have charged that the non-government owned banks are too aggressive
in their loan recovery efforts in connection with housing, vehicle and personal loans. There
are press reports that the banks' loan recovery efforts have driven defaulting borrowers to
suicide.
2.6 Banks in India
In India the banks are being segregated in different groups. Each group has their own benefits
and limitations in operating in India. Each has their own dedicated target market. Few of
them only work in rural sector while others in both rural as well as urban. Many even are
only catering in cities. Some are of Indian origin and some are foreign players.
All these details and many more is discussed over here. The banks and its relation with the
customers, their mode of operation, the names of banks under different groups and other such
useful informations are talked about.
One more section has been taken note of is the upcoming foreign banks in India. The RBI has
shown certain interest to involve more of foreign banks than the existing one recently. This
step has paved a way for few more foreign banks to start business in India.
Major Banks in India
ABN-AMRO Bank
Abu Dhabi Commercial Bank
American Express Bank
Andhra Bank
Allahabad Bank
Bank of Baroda
Bank of India
Indian Overseas Bank
Indusind Bank
ING Vysya Bank
Jammu & Kashmir Bank
JPMorgan Chase Bank
Karnataka Bank
Karur Vysya Bank
http://finance.indiamart.com/investment_in_india/abn_amro.htmlhttp://finance.indiamart.com/investment_in_india/abu_dhabi_commercial_bank.htmlhttp://finance.indiamart.com/investment_in_india/amex_bank.htmlhttp://finance.indiamart.com/investment_in_india/andhra_bank.htmlhttp://finance.indiamart.com/investment_in_india/allahabad_bank.htmlhttp://finance.indiamart.com/investment_in_india/bank_of_baroda.htmlhttp://finance.indiamart.com/investment_in_india/bank_of_india.htmlhttp://finance.indiamart.com/investment_in_india/indian_overseas_bank.htmlhttp://finance.indiamart.com/investment_in_india/indusind_bank.htmlhttp://finance.indiamart.com/investment_in_india/ing_vysya_bank.htmlhttp://finance.indiamart.com/investment_in_india/jammu_and_kashmir_bank.htmlhttp://finance.indiamart.com/investment_in_india/jpmorgan_chase_bank.htmlhttp://finance.indiamart.com/investment_in_india/karnataka_bank.htmlhttp://finance.indiamart.com/investment_in_india/karur_vysya_bank.htmlhttp://finance.indiamart.com/investment_in_india/abn_amro.htmlhttp://finance.indiamart.com/investment_in_india/abu_dhabi_commercial_bank.htmlhttp://finance.indiamart.com/investment_in_india/amex_bank.htmlhttp://finance.indiamart.com/investment_in_india/andhra_bank.htmlhttp://finance.indiamart.com/investment_in_india/allahabad_bank.htmlhttp://finance.indiamart.com/investment_in_india/bank_of_baroda.htmlhttp://finance.indiamart.com/investment_in_india/bank_of_india.htmlhttp://finance.indiamart.com/investment_in_india/indian_overseas_bank.htmlhttp://finance.indiamart.com/investment_in_india/indusind_bank.htmlhttp://finance.indiamart.com/investment_in_india/ing_vysya_bank.htmlhttp://finance.indiamart.com/investment_in_india/jammu_and_kashmir_bank.htmlhttp://finance.indiamart.com/investment_in_india/jpmorgan_chase_bank.htmlhttp://finance.indiamart.com/investment_in_india/karnataka_bank.htmlhttp://finance.indiamart.com/investment_in_india/karur_vysya_bank.html -
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Bank of Maharashtra
Bank of Punjab
Bank of Rajasthan
Bank of Ceylon
BNP Paribas Bank
Canara Bank
Catholic Syrian Bank
Central Bank of India
Centurion Bank
China Trust Commercial Bank
Citi Bank
City Union Bank
Corporation Bank
Dena Bank
Deutsche Bank
Development Credit Bank
Dhanalakshmi Bank
Federal Bank
HDFC Bank
HSBCICICI Bank
IDBI Bank
Indian Bank
Laxmi Vilas Bank
Oriental Bank of Commerce
Punjab National Bank
Punjab & Sind Bank
Scotia Bank
South Indian Bank
Standard Chartered Bank
State Bank of India (SBI)
State Bank of Bikaner & Jaipur
State Bank of Hyderabad
State Bank of Indore
State Bank of Mysore
State Bank of Saurashtra
State Bank of Travancore
Syndicate Bank
Taib Bank
UCO Bank
Union Bank of India
United Bank of India
United Bank Of India
United Western Bank
UTI Bank
2.7 Fact Files of Banks in India
The first, the oldest, the largest, the biggest, get all such types of informations about Banking
in India in this section.
The first bank in India to be given an ISO Certification Canara Bank
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.htmlhttp://finance.indiamart.com/investment_in_india/scotia_bank.htmlhttp://finance.indiamart.com/investment_in_india/south_indian_bank.htmlhttp://finance.indiamart.com/investment_in_india/standard_chartered_bank.htmlhttp://finance.indiamart.com/investment_in_india/state_bank_india.htmlhttp://finance.indiamart.com/investment_in_india/state_bank_bikaner_and_jaipur.htmlhttp://finance.indiamart.com/investment_in_india/state_bank_of_hyderabad.htmlhttp://finance.indiamart.com/investment_in_india/state_bank_of_indore.htmlhttp://finance.indiamart.com/investment_in_india/state_bank_of_mysore.htmlhttp://finance.indiamart.com/investment_in_india/state_bank_of_saurastra.htmlhttp://finance.indiamart.com/investment_in_india/state_bank_of_travancore.htmlhttp://finance.indiamart.com/investment_in_india/syndicate_bank.htmlhttp://finance.indiamart.com/investment_in_india/taib_bank.htmlhttp://finance.indiamart.com/investment_in_india/uco_bank.htmlhttp://finance.indiamart.com/investment_in_india/union_bank_india.htmlhttp://finance.indiamart.com/investment_in_india/united_bank_of_india.htmlhttp://finance.indiamart.com/investment_in_india/united_bank_india.htmlhttp://finance.indiamart.com/investment_in_india/united_western_bank.htmlhttp://finance.indiamart.com/investment_in_india/uti_bank.html 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The first bank in Northern India to get ISO 9002 certification for
their selected branches
Punjab and Sind
Bank
The first Indian bank to have been started solely with Indian
capital
Punjab National
Bank
The first among the private sector banks in Kerala to become a
scheduled bank in 1946 under the RBI ActSouth Indian Bank
India's oldest, largest and most successful commercial bank,
offering the widest possible range of domestic, international and
NRI products and services, through its vast network in India and
overseas
State Bank of India
India's second largest private sector bank and is now the largest
scheduled commercial bank in India
The Federal Bank
Limited
Bank which started as private shareholders banks, mostly
Europeans shareholders
Imperial Bank of
India
The first Indian bank to open a branch outside India in London in1946 and the first to open a branch in continental Europe at Paris
in 1974
Bank of India,founded in 1906 in
Mumbai
The oldest Public Sector Bank in India having branches all over
India and serving the customers for the last 132 yearsAllahabad Bank
The first Indian commercial bank which was wholly owned and
managed by Indians
Central Bank of
India
Bank of India was founded in 1906 in Mumbai. It became the first Indian bank to open a
branch outside India in London in 1946 and the first to open a branch in continental Europe at
Paris in 1974.
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2.8 Public sector banks
Among the Public Sector Banks in India, United Bank of India is one of the 14 major banks,
which were nationalized on July 19, 1969. Its predecessor, in the Public Sector Banks, the
United Bank of India Ltd., was formed in 1950 with the amalgamation of four banks viz.
Oriental Bank of Commerce (OBC), Government of India Undertaking offers Domestic, NRI
and Commercial banking services. OBC is implementing a GRAMEEN PROJECT in
Dehradun District (UP) and Hanumangarh District (Rajasthan) disbursing small loans. This
Public Sector Bank India has implemented 14 point action plan for strengthening of credit
delivery to women and has designated 5 branches as specialized branches for women
entrepreneurs.
2.8.1 The following are the list of Public Sector Banks in
India
Allahabad Bank
Andhra Bank
Bank of Baroda
Bank of India
Bank of Maharashtra
Canara Bank
Central Bank of India
Corporation Bank
Dena Bank
Indian Bank
Indian Overseas Bank
Oriental Bank of Commerce
http://finance.indiamart.com/investment_in_india/allahabad_bank.htmlhttp://finance.indiamart.com/investment_in_india/andhra_bank.htmlhttp://finance.indiamart.com/investment_in_india/bank_of_baroda.htmlhttp://finance.indiamart.com/investment_in_india/bank_of_india.htmlhttp://finance.indiamart.com/investment_in_india/bank_of_maharastra.htmlhttp://finance.indiamart.com/investment_in_india/canara_bank.htmlhttp://finance.indiamart.com/investment_in_india/central_bank_india.htmlhttp://finance.indiamart.com/investment_in_india/corporation_bank.htmlhttp://finance.indiamart.com/investment_in_india/dena_bank.htmlhttp://finance.indiamart.com/investment_in_india/indian_bank.htmlhttp://finance.indiamart.com/investment_in_india/indian_overseas_bank.htmlhttp://finance.indiamart.com/investment_in_india/oriental_bank_commerce.htmlhttp://finance.indiamart.com/investment_in_india/allahabad_bank.htmlhttp://finance.indiamart.com/investment_in_india/andhra_bank.htmlhttp://finance.indiamart.com/investment_in_india/bank_of_baroda.htmlhttp://finance.indiamart.com/investment_in_india/bank_of_india.htmlhttp://finance.indiamart.com/investment_in_india/bank_of_maharastra.htmlhttp://finance.indiamart.com/investment_in_india/canara_bank.htmlhttp://finance.indiamart.com/investment_in_india/central_bank_india.htmlhttp://finance.indiamart.com/investment_in_india/corporation_bank.htmlhttp://finance.indiamart.com/investment_in_india/dena_bank.htmlhttp://finance.indiamart.com/investment_in_india/indian_bank.htmlhttp://finance.indiamart.com/investment_in_india/indian_overseas_bank.htmlhttp://finance.indiamart.com/investment_in_india/oriental_bank_commerce.html -
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Punjab & Sind Bank
Punjab National Bank
Syndicate Bank
UCO Bank
Union Bank of India
United Bank of India
Vijaya Bank
2.8.2 List of State Bank of India and its subsidiary, a Public
Sector Banks
State Bank of India
State Bank of Bikaner & Jaipur
State Bank of Hyderabad
State Bank of Indore
State Bank of Mysore
State Bank of Saurashtra
State Bank of Travancore
2.9 Private sector banks
Private banking in India was practiced since the beginning of banking system in India. The
first private bank in India to be set up in Private Sector Banks in India was Indusind Bank. It
is one of the fastest growing Bank Private Sector Banks in India. IDBI ranks the tenth largest
development bank in the world as Private Banks in India and has promoted world class
institution in India.
http://finance.indiamart.com/investment_in_india/punjab_sind_bank.htmlhttp://finance.indiamart.com/investment_in_india/punjab_national_bank.htmlhttp://finance.indiamart.com/investment_in_india/syndicate_bank.htmlhttp://finance.indiamart.com/investment_in_india/uco_bank.htmlhttp://finance.indiamart.com/investment_in_india/union_bank_india.htmlhttp://finance.indiamart.com/investment_in_india/united_bank_of_india.htmlhttp://finance.indiamart.com/investment_in_india/vijaya_bank.htmlhttp://finance.indiamart.com/investment_in_india/state_bank_india.htmlhttp://finance.indiamart.com/investment_in_india/state_bank_bikaner_and_jaipur.htmlhttp://finance.indiamart.com/investment_in_india/state_bank_of_hyderabad.htmlhttp://finance.indiamart.com/investment_in_india/state_bank_of_indore.htmlhttp://finance.indiamart.com/investment_in_india/state_bank_of_mysore.htmlhttp://finance.indiamart.com/investment_in_india/state_bank_of_saurastra.htmlhttp://finance.indiamart.com/investment_in_india/state_bank_of_travancore.htmlhttp://finance.indiamart.com/investment_in_india/punjab_sind_bank.htmlhttp://finance.indiamart.com/investment_in_india/punjab_national_bank.htmlhttp://finance.indiamart.com/investment_in_india/syndicate_bank.htmlhttp://finance.indiamart.com/investment_in_india/uco_bank.htmlhttp://finance.indiamart.com/investment_in_india/union_bank_india.htmlhttp://finance.indiamart.com/investment_in_india/united_bank_of_india.htmlhttp://finance.indiamart.com/investment_in_india/vijaya_bank.htmlhttp://finance.indiamart.com/investment_in_india/state_bank_india.htmlhttp://finance.indiamart.com/investment_in_india/state_bank_bikaner_and_jaipur.htmlhttp://finance.indiamart.com/investment_in_india/state_bank_of_hyderabad.htmlhttp://finance.indiamart.com/investment_in_india/state_bank_of_indore.htmlhttp://finance.indiamart.com/investment_in_india/state_bank_of_mysore.htmlhttp://finance.indiamart.com/investment_in_india/state_bank_of_saurastra.htmlhttp://finance.indiamart.com/investment_in_india/state_bank_of_travancore.html -
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The first Private Bank in India to receive an in principle approval from the Reserve Bank of
India was Housing Development Finance Corporation Limited, to set up a bank in the private
sector banks in India as part of the RBI's liberalization of the Indian Banking Industry. It was
incorporated in August 1994 as HDFC Bank Limited with registered office in Mumbai and
commenced operations as Scheduled Commercial Bank in January 1995.
ING Vysya, yet another Private Bank of India was incorporated in the year 1930. Bangalore
has a pride of place for having the first branch inception in the year 1934. With successive
years of patronage and constantly setting new standards in banking, ING Vysya Bank has
many credits to its account.
2.9.1 List of Private Banks in India
Bank of Punjab
Bank of Rajasthan
Catholic Syrian Bank
Centurion Bank
City Union Bank
Dhanalakshmi Bank
Development Credit Bank
Federal Bank
HDFC Bank
ICICI Bank
IDBI Bank
Indusind Bank
ING Vysya Bank
Jammu & Kashmir Bank
Karnataka Bank
http://finance.indiamart.com/investment_in_india/bank_of_punjab.htmlhttp://finance.indiamart.com/investment_in_india/bank_of_rajasthan.htmlhttp://finance.indiamart.com/investment_in_india/catholic_syrian_bank.htmlhttp://finance.indiamart.com/investment_in_india/centurion_bank.htmlhttp://finance.indiamart.com/investment_in_india/city_union_bank.htmlhttp://finance.indiamart.com/investment_in_india/dhanalakshmi_bank.htmlhttp://finance.indiamart.com/investment_in_india/development_credit_bank.htmlhttp://finance.indiamart.com/investment_in_india/federal_bank.htmlhttp://finance.indiamart.com/investment_in_india/hdfc_bank.htmlhttp://finance.indiamart.com/investment_in_india/icici_bank.htmlhttp://finance.indiamart.com/investment_in_india/idbi.htmlhttp://finance.indiamart.com/investment_in_india/indusind_bank.htmlhttp://finance.indiamart.com/investment_in_india/ing_vysya_bank.htmlhttp://finance.indiamart.com/investment_in_india/jammu_and_kashmir_bank.htmlhttp://finance.indiamart.com/investment_in_india/karnataka_bank.htmlhttp://finance.indiamart.com/investment_in_india/bank_of_punjab.htmlhttp://finance.indiamart.com/investment_in_india/bank_of_rajasthan.htmlhttp://finance.indiamart.com/investment_in_india/catholic_syrian_bank.htmlhttp://finance.indiamart.com/investment_in_india/centurion_bank.htmlhttp://finance.indiamart.com/investment_in_india/city_union_bank.htmlhttp://finance.indiamart.com/investment_in_india/dhanalakshmi_bank.htmlhttp://finance.indiamart.com/investment_in_india/development_credit_bank.htmlhttp://finance.indiamart.com/investment_in_india/federal_bank.htmlhttp://finance.indiamart.com/investment_in_india/hdfc_bank.htmlhttp://finance.indiamart.com/investment_in_india/icici_bank.htmlhttp://finance.indiamart.com/investment_in_india/idbi.htmlhttp://finance.indiamart.com/investment_in_india/indusind_bank.htmlhttp://finance.indiamart.com/investment_in_india/ing_vysya_bank.htmlhttp://finance.indiamart.com/investment_in_india/jammu_and_kashmir_bank.htmlhttp://finance.indiamart.com/investment_in_india/karnataka_bank.html -
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Karur Vysya Bank
Laxmi Vilas Bank
South Indian Bank
United Western Bank
2.10 Indian banking industry
The Indian banking market is growing at an astonishing rate, with Assets expected to reach
US$1 trillion by 2010. An expanding economy, middle class, and technological innovations
are all contributing to this growth.
The countrys middle class accounts for over 320 million People. In correlation with the
growth of the economy, rising income levels, increased standard of living, and affordability
of banking products are promising factors for continued expansion.
The Indian banking market is growing at an astonishing rate, with Assets expected to reach
US$1 trillion by 2010. An expanding economy, middle class, and technological innovations
are all contributing to this growth.
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The Indian banking Industry is in the middle of an IT revolution, Focusing on the
expansion of retail and rural banking. Players are becoming increasingly customer -
centric in their approach, which has resulted in innovative methods of offering new banking
products and services. The banking industry should focus on having a small number of
large players that can compete globally rather than having a large number of fragmented
players."
Introduction of Company
Industrial Development Bank of India Ltd.
Type Public (BSE: 500116)
Industry Banking
Financial services
Founded July 1964
Headquarters Mumbai, India
Key people Shri R. M. Malla, CMD
Products Finance and insurance
Revenue Rs 20685 Crore (2011)[1]
Operating income Rs 4158 Crore (2011)
Net income Rs 1650 Crore (2011)
Employees 8,989
Website www.idbi.com
http://en.wikipedia.org/wiki/Types_of_business_entityhttp://en.wikipedia.org/wiki/Public_companyhttp://en.wikipedia.org/wiki/Bombay_Stock_Exchangehttp://www.bseindia.com/bseplus/StockReach/AdvanceStockReach.aspx?scripcode=500116%E2%80%8Ehttp://en.wikipedia.org/wiki/Bankinghttp://en.wikipedia.org/wiki/Financial_serviceshttp://en.wikipedia.org/wiki/Mumbaihttp://en.wikipedia.org/wiki/Indiahttp://en.wikipedia.org/wiki/CMDhttp://en.wikipedia.org/wiki/Finance_and_insurancehttp://en.wikipedia.org/wiki/Earnings_before_interest_and_taxeshttp://en.wikipedia.org/wiki/Net_incomehttp://www.idbi.com/http://en.wikipedia.org/wiki/File:IDBI_Logo.svghttp://en.wikipedia.org/wiki/Types_of_business_entityhttp://en.wikipedia.org/wiki/Public_companyhttp://en.wikipedia.org/wiki/Bombay_Stock_Exchangehttp://www.bseindia.com/bseplus/StockReach/AdvanceStockReach.aspx?scripcode=500116%E2%80%8Ehttp://en.wikipedia.org/wiki/Bankinghttp://en.wikipedia.org/wiki/Financial_serviceshttp://en.wikipedia.org/wiki/Mumbaihttp://en.wikipedia.org/wiki/Indiahttp://en.wikipedia.org/wiki/CMDhttp://en.wikipedia.org/wiki/Finance_and_insurancehttp://en.wikipedia.org/wiki/Earnings_before_interest_and_taxeshttp://en.wikipedia.org/wiki/Net_incomehttp://www.idbi.com/ -
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3.1 History
3.1.1 Industrial Development Bank of IndiaIndustrial Development bank of India (IDBI) was constituted under Industrial Development
bank of India Act, 1964 as a Development Financial Institution and came into being as on
July 01, 1964 wide goal notification dated June 22, 1964. It was regarded as a Public
Financial Institution in terms of the provisions of Section 4A of the Companies Act, 1956. It
continued to serve as a DFI for 40 years till the year 2004 when it was transformed into a
Bank.
3.1.2 Industrial Development Bank of India Limited
In response to the felt need and on commercial prudence, it was decided to transform IDBI
into a Bank. For the purpose, Industrial Development bank Act, 2003 [Repeal Act] was
passed repealing the Industrial Development Bank of India Act, 1964. In terms of the
provisions of the Repeal Act, a new company under the name of Industrial Development
Bank of India Limited (IDBI Ltd.) was incorporated as a Govt. Company under the
Companies Act, 1956 on September 27, 2004. Thereafter, the undertaking of IDBI was
transferred to and vested in IDBI Ltd. with effect from the effective date of October 01, 2004.
In terms of the provisions of the Repeal Act, IDBI Ltd. has been functioning as a Bank in
addition to its earlier role of a Financial Institution.
3.1.2 Merger of IDBI bank Ltd. with IDBI Ltd.
Towards achieving the faster inorganic growth of the Bank, IDBI Bank Ltd., a wholly owned
subsidiary of IDBI Ltd. was amalgamated with IDBI Ltd. in terms of the provisions of
Section 44A of the Banking Regulation Act, 1949 providing for voluntary amalgamation of
two banking companies. The merger became effective from April 02, 2005.
3.1.3 Merger of United Western bank with IDBI Ltd.
The United Western bank Ltd. (UWB), a Satara based private sector bank was placed under
moratorium by RBI. Upon IDBI Ltd. showing interest to take over the said bank towards its
further inorganic growth, RBI and Govt. of India amalgamated UWB with IDBI Ltd. in terms
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IDBI BANKINVESTMENTCURRENT ACCOUNTSAVING ACCOUNTDEVELOPMENT BANK.RETAIL BANKINGCORPORATE SAVINGPERSONAL SAVING
of the provisions of Section 45 of the Banking Regulation Act, 1949. The merger came into
effect on October 03, 2006.
3.1.4 Change of name of IDBI Ltd. to IDBI Bank Ltd.
In order that the name of the Bank truly reflects the functions it is carrying on, the name of
the Bank was changed to IDBI Bank Limited and the new name became effective from May
07, 2008 upon issue of the Fresh Certificate of Incorporation by Registrar of Companies,
Maharashtra. The Bank has been accordingly functioning in its present name of IDBI Bank
Limited.
3.2 Vision
To be the trusted partner in progress by leveraging quality human capital and selling globalstandards of excellence to build the most valued financial conglomerate.
3.3 Qu ality of Products and Services
IDBI Bank Ltd. shall continue to be committed to creating new industry standards of
excellence in customer service. IDBI Bank Ltd. shall provide innovative and superior quality
customer service consistent with the requirements of the customers for their satisfaction.
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3.4 Corporate Opportunity
A Director / Officer / Employee must not deprive IDBI Bank Ltd. of an opportunity that
belongs to IDBI Bank Ltd., for his/ her own/other's advantage, if he / she is in a position of
diverting the corporate opportunity for own benefit or to others to the detriment of IDBI Bank
Ltd. A Director / Officer / Employee must not compete with IDBI Bank Ltd. in respect of any
business transaction.
3.5 IDBI Bank Organizational Chart
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3.6 Board of Directors
Mr. R.M. Malla
(Chairman & managing director)
Mr. B. P. Singh
(Deputy managing Director)
Mr. Rakesh Singh Mr. R.P. Singh
ChairmanPresidentVice presidentFinance
Vice presidentMarketing
Vice presidentOperations
Vice presidentH. R.
Divisional SalesManager
Zonal Head
Territory In charge
Regional Head
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Ms.Lila Firoz Poonawalla Mr. K. Narasimha Murthy
Mr. Hiralal Zutshi Mr. Subhash Tuli
Dr. B.S. Bisht
3.7 Recruitments
In our continuous endeavour to improve the selection process for recruitment at all levels in
IDBI Bank, we have carried out an in-depth study of the competencies required to succeed in
IDBI Bank.
As a rapidly growing organization we look to induct talent from various reputed business
schools/educational institute across the country. Enthusiastic and talented youth form the
backbone of our banking operations and will become our future leaders. What we offer is the
grooming needed to be the best. We offer a wide range of careers in all functions including -
Finance, Marketing, Operations and Human Resources.
We are proud of our ability to nurture individuals and provide them the space and
empowerment they need to hone their talents. Our size gives us the unique ability to provide
fast growth and high responsibility early in ones career as well as multiple avenues to reach
the top.
3.8 Management & Organisation
IDBI Bank is a Board-managed organisation. The responsibility for the day-to-day
management of operations of the Bank is vested with the Chairman & Managing Director and
Deputy Managing Director, who draw upon the support and expertise of a cross-disciplinary
Top Management Team. IDBI Bank Ltd.'s employee base includes professionals from the
fields of accountancy, management, engineering, law, computer technology, banking and
economics.
3.9 Corporate Social Responsibility
IDBI Bank Ltd. shall continue to be committed to be a good corporate citizen not only in
compliance with all relevant regulating laws and regulations but also by actively assisting in
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the improvement of the quality of life of the people in the communities in which it operates
with the objective of making them self reliant.
3.10 Corporate Governance
IDBI upholds the highest standards of corporate governance in its operations. The
responsibility for maintaining these high standards of governance lies with its Board of
Directors. Two Committees of the Board viz. the Executive Committee and the Audit
Committee are adequately empowered to monitor implementation of good corporate
governance practices and making necessary disclosures within the framework of legal
provisions and banking conventions.
3.11 Milestones
July 1964: Set up under an Act of Parliament as a wholly-owned subsidiary of
Reserve Bank of India.
February 1976: Ownership transferred to Government of India. Designated Principal
Financial Institution for co-coordinating the working of institutions at national and
State levels engaged in financing, promoting and developing industry.
March 1982: International Finance Division of IDBI transferred to Export-Import
Bank of India, established as a wholly-owned corporation of Government of India,
under an Act of Parliament.
April 1990: Set up Small Industries Development Bank of India (SIDBI) under
SIDBI Act as a wholly-owned subsidiary to cater to specific needs of small-scale
sector. In terms of an amendment to SIDBI Act in September 2000, IDBI divested
51% of its shareholding in SIDBI in favor of banks and other institutions in the first
phase. IDBI has subsequently divested 79.13% of its stake in its erstwhile subsidiary
to date.
January 1992: Accessed domestic retail debt market for the first time with innovative
Deep Discount Bonds; registered path-breaking success.
December 1993: Set up IDBI Capital Market Services Ltd. as a wholly-owned
subsidiary to offer a broad range of financial services, including Bond Trading, Equity
Broking, Client Asset Management and Depository Services. IDBI Capital is
currently a leading Primary Dealer in the country.
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September 1994: Set up IDBI Bank Ltd. in association with SIDBI as a private sector
commercial bank subsidiary, a sequel to RBI's policy of opening up domestic banking
sector to private participation as part of overall financial sector reforms.
October 1994: IDBI Act amended to permit public ownership up to 49%.
July 1995: Made Initial Public Offer of Equity and raised over Rs.2000 crore, thereby
reducing Government stake to 72.14%.
March 2000: Entered into a JV agreement with Principal Financial Group, USA for
participation in equity and management of IDBI Investment Management Company
Ltd., erstwhile a 100% subsidiary. IDBI divested its entire shareholding in its asset
management venture in March 2003 as part of overall corporate strategy.
March 2000: Set up IDBI Intec Ltd. as a wholly-owned subsidiary to undertake IT-
related activities.
June 2000: A part of Government shareholding converted to preference capital, since
redeemed in March 2001; Government stake currently 58.47%.
August 2000: Became the first All-India Financial Institution to obtain ISO
9002:1994 Certification for its treasury operations. Also became the first organisation
in Indian financial sector to obtain ISO 9001:2000 Certification for its forex services.
March 2001: Set up IDBI Trusteeship Services Ltd. to provide technology-driven
information and professional services to subscribers and issuers of debentures.
February 2002: Associated with select banks/institutions in setting up Asset
Reconstruction Company (India) Limited (ARCIL), which will be involved with the
Strategic management of non-performing and stressed assets of Financial Institutions
and Banks.
September 2003: IDBI acquired the entire shareholding of Tata Finance Limited in
Tata Home finance Ltd, signaling IDBI's foray into the retail finance sector. The
housing finance subsidiary has since been renamed 'IDBI Home finance Limited'.
December 2003: On December 16, 2003, the Parliament approved The Industrial
Development Bank (Transfer of Undertaking and Repeal Bill) 2002 to repeal IDBI
Act 1964. The President's assent for the same was obtained on December 30, 2003.
The Repeal Act is aimed at bringing IDBI under the Companies Act for investing it
with the requisite operational flexibility to undertake commercial banking business
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under the Banking Regulation Act 1949 in addition to the business carried on and
transacted by it under the IDBI Act, 1964.
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 in-principle decision
regarding merger of IDBI Bank Ltd. with proposed Industrial Development Bank of
India Ltd. in their respective meetings on July 29, 2004.
September 2004: The Trust Deed for Stressed Assets Stabilization Fund (SASF)
executed by its Trustees on September 24, 2004 and the first meeting of the Trustees
was held on September 27, 2004.
September 2004: The new entity "Industrial Development Bank of India" was
incorporated on September 27, 2004 and Certificate of commencement of business
was issued by the Registrar of Companies on September 28, 2004.
September 2004:Notification issued by Ministry of Finance specifying SASF as a
financial institution under Section 2(h)(ii) of Recovery of Debts due to Banks &
Financial Institutions Act, 1993.
September 2004:Notification issued by Ministry of Finance on September 29, 2004
for issue of non-interest bearing goal IDBI Special Security, 2024, aggregating
Rs.9000 crore, of 20-year tenure.
September 2004: Notification for appointed day as October 1, 2004, issued by
Ministry of Finance on September 29, 2004.
September 2004:RBI issues notification for inclusion of Industrial Development
Bank of India Ltd. in Schedule II of RBI Act, 1934 on September 30, 2004.
October 2004: Appointed day - October 01, 2004 - Transfer of undertaking of IDBI
to IDBI Ltd. IDBI Ltd. commences operations as a banking company. IDBI Act, 1964
stands repealed. January 2005: The Board of Directors of IDBI Ltd., at its meeting
held on January 20, 2005, approved the Scheme of Amalgamation, envisaging
merging of IDBI Bank Ltd. with IDBI Ltd. Pursuant to the scheme approved by the
Boards of both the banks, IDBI Ltd. will issue 100 equity shares for 142 equity shares
held by shareholders in IDBI Bank Ltd. EGM has been convened on February 23,
2005 for seeking shareholder approval for the scheme.
3.12 Investor
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3.17 Preamble
IDBI Bank Ltd. is committed to creating long term economic value for all its stakeholders,
including shareholders, depositors, customers, employees and the society as a whole. IDBI
Bank Ltd. is committed to maintaining high standards of ethical and professional conduct in
all its corporate activities.
3.18 Competition
IDBI Bank Ltd. shall market its products and services on its own merits.
3.19 Equal-Rights
IDBI Bank Ltd shall continue to provide equal opportunities to all its employees and all
qualified applicants for employment without regard to their race, caste, religion, colour,
ancestry, marital status, sex, age, nationality, disability etc. Applicable laws, rules, and
guidelines of Government of India / any other Competent Authority in this regard shall also
be observed for this purpose. Employees of IDBI Bank Ltd. shall be treated with dignity and
in accordance with the IDBI Bank Ltd. policy to maintain a work environment free of sexual
harassment, whether physical, verbal or psychological. Employee policies and practices shall
be administered on a non-discriminatory basis in all matters relating to recruitment, training,
compensation, benefits, promotion, transfers and all others terms and conditions of
employment.
3.20 Prohibited Business
IDBI Bank Ltd. shall not enter into any kind of business with any company / organisation /
entity, of which any of its director of is a proprietor, partner, director, a manager, employee
or guarantor or in which one or more directors of IDBI Bank Ltd. together hold substantial
interest.
Substantial interest, in relation to any company / organisation / entity, means any beneficial
interest held by one or more of the directors of IDBI Bank Ltd. or by any relative of such
director, whether singly or taken together, in the shares of the company / organisation / entity,
the aggregate amount paid up on which either exceeds five lakh of rupees or 5% of its paid-
up share capital, whichever is lesser.
3.21 Public Representation of the Company & the Group
IDBI Bank Ltd. honours the information requirements of the public and its stakeholders. All
its external communication will be only by officials / directors authorised for the purpose.
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Savings Accounts transactions starting September 1, 2010. This is a measure to further
strengthen the Bank's bond with its customers. This initiative captures the Banks
philosophy of valuing the customers more than their money.
2) IDBI Bank has merged two of its wholly owned subsidiaries, IDBI Home Finance Ltd.
and IDBI Gilts Ltd. with itself on January 1, 2011.
3) In July 2010, IDBI Bank has received Rs. 3,119.04 Crore from the Government of India
towards consideration for preferential issue of equity shares to GoI at a price of Rs.120.19
per share in terms of the approval accorded by the Shareholders at the sixth AGM of the
Bank. With this capital infusion, GoI stake in IDBI Bank has risen to around 65.13%.
4) IDBI Bank Ltd. launched the Cash at POS facility at Mumbai. IDBI Bank is amongst the
first few banks to launch this facility. The facility would enable debit card holders of any
bank in India to withdraw cash of upto Rs.1000 per day at designated merchant
establishments by swiping their debit cards on the Point of Sale (POS) terminals. The
facility can be availed of either as a pure cash withdrawal or along with purchase of goods
& services. The merchant establishment will not levy any charges for dispensing cash. IDBI
Bank has decided to offer this facility free of charge to its debit card holders.
5) IDBI Bank launched a multi-currency remittance facility for making payments in
miscellaneous currencies. With this facility, IDBI Bank now offers its customers,remittance facility in more than 125 currencies.
6) With increasing focus towards the Micro, Small & Medium Enterprises (MSME) sector,
IDBI Bank has signed a MoU with the Small Industries Development Bank of India
(SIDBI) for joint financing of MSMEs. Further, the Bank has signed another MoU with
World Resources Institute (WRI) for financing MSMEs for implementing ESCO (Energy
Saving Company) projects.
7) In recognition of its initiatives in the SME sector, IDBI Bank has received the BestPublic Sector Bank award in SME Financing from global business information provider
Dun & Bradstreet (D&B) in August 2010.
8) Given its focus on promoting Financial Inclusion, IDBI Bank has recently launched
Urban Financial Inclusion Drive to include the urban-poor population of the country under
the fold of banking services through an extensive usage of biometric smart cards and hand-
held devices.
9) IDBI Bank has become a Registrar for Unique Identification Authority of India (UIDAI).
A Memorandum of Understanding (MoU) was signed by the Bank and Unique
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Identification Authority of India (UIDAI), on January 10, 2011. IDBI Bank plans to
dovetail its Financial Inclusion Plan with the UID enrolment for new customers. It will also
facilitate issuance of Aadhaar number for its existing customers which will enable the Bank
to deploy Aadhaar based services across various delivery channels like ATMs and MicroATMs.
10) IDBI Bank was conferred the Award for the Fastest Growing Bank at Best Bank
Awards organized by Business Today. IDBI Bank was the recipient of the Award in the
Large Banks Category.
11) IDBI Bank has been identified for award of The most admired Debt Financier in
Infrastructure Sector by KPMG and Infrastructure Today.
12) IDBI Bank was conferred the Award for Brand Excellence at the World Brand
Congress 2010 organized by CMO, Asia. IDBI Bank was the recipient of the Award in the
Banking Category.
13) IDBI Bank Ltd. was awarded the coveted international certification ISO 9001:2008 for
all its Currency Chests across the country in June 2010. Subsequently, the Bank was
awarded the same certification for its Centralised Clearing Units across the country.
14) IDBI Bank, along with the technology partner Oracle won the Asian Banker
Technology Implementation Award 2011 for Best Data and Analytics Project for
implementing an analytics solution that measures and analyses interest rate and liquidity
risks, integrates its performance management framework and conducts faster and robust
scenario analyses.
15) At the Banking Technology Awards instituted by the IBA, IDBI Bank received the
award for best use of Business Intelligence and best Risk Management. The Bank was a
runner up in the category for use of Technology in training and e-learning initiatives.
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3.26 Competitors of IDBI bank
The major competitor of IDBI bank is given below:
(1) SBI
(2) PNB
(3) BANK OF INDIA
(4) BANK OF BARODA
(5) CANARA BANK
All the other banks are the competitors of IDBI as IDBI deals with a variety of products.
SBI
Profile
State Bank of India is the largest and one of the oldest commercial bank in India, in existence
for more than 200 years. The bank provides a full range of corporate, commercial and retail
banking services in India. Indian central bank namely Reserve Bank of India (RBI) is the
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ProfileWith over 60 million satisfied customers and more than 5100 offices including 5 overseas
branches, PNB has continued to retain its leadership position amongst the nationalized banks.
The bank enjoys strong fundamentals, large franchise value and good brand image. Besides
being ranked as one of India's top service brands, PNB has remained fully committed to its
guiding principles of sound and prudent banking. Apart from offering banking products, the
bank has also entered the credit card, debit card; bullion business; life and non-life insurance;
Gold coins & asset management business, etc. PNB has earned many awards and accoladesduring the year in appreciation of excellence in services, Corporate Social Responsibility
(CSR) practices, transparent governance structure, best use of technology and good human
resource management.
Since its humble beginning in 1895 with the distinction of being the first Swadeshi Bank to
have been started with Indian capital, PNB has achieved significant growth in business which
at the end of March 2011 amounted to Rs 5,55,005 crore. PNB is ranked as the 2nd largest
bank in the country after SBI in terms of branch network, business and many other
parameters. During the FY 2010-11, with 39.16% share of CASA to domestic deposits, the
Bank achieved a net profit of Rs 4433 crore. Bank has a strong capital base with capital
adequacy ratio of 12.42% as on Mar11 as per Basel II with Tier I and Tier II capital ratio at
8.44% and 3.98% respectively. As on March11, the Bank has the Gross and Net NPA r
