Hdfc Bank

INTRODUCTION

This project will emphasis on the comparative study of ICICI Bank and HDFC BANK

parameter this project will be highlighting the preference of customer for a particular

bank. HDFC was established in the year 1994, they are old player in banking sector. The

bank has two principle client segments –customer and asset management. The bank

follows values such as – Integrity, teamwork, respect, professionalism, & Mission. The

segment of bank we are considering here is- Corporate banking. The products out of

which have chosen for research is Saving Accounts. This research helps us in finding out

the customers view regarding the product and Services offered by the HDFC bank and

awareness by promotion and also identifying the market potential of the product offered

by the HDFC bank.

The banking sector in India has made remarkable progress since the economic reforms in 1991.

New private sector banks have brought the necessary competition into the industry and

spearheaded the changes towards higher utilization of technology, improved customer service

and innovative products. Customers are now becoming increasingly conscious of their rights and

are demanding more than ever before. The recent trends show that most banks are shifting from a

“product-centric model” to a “customer-centric model” as customer satisfaction has become one

of the major determinants of business growth. In this context, prioritization of preferences and

close monitoring of customer satisfaction have become essential for banks. Keeping these in

mind, an attempt has been made in this study to analyze the factors that are essential in

influencing the investment decision of the customers of the public sector banks. For this purpose,

Factor Analysis, which is the most appropriate multivariate technique, has been used to identify

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the groups of determinants. Factor analysis identifies common dimensions of factors from the

observed variables that link together the seemingly unrelated variables and provides insight into

the underlying structure of the data. Secondly, this study also suggests some measures to

formulate marketing strategies to lure customers towards banks.

Key Words:

Bank:

A bank is a financial institution whose primary activity is to act as a payment agent for

customers and to borrow and lend money. It is an institution for receiving, keeping, and lending

money.

Mobile Banking:

Mobile banking (also known as M-Banking, mbanking, SMS Banking etc.) is a term used for

performing balance checks, account transactions, payments etc. via a mobile device such as a

mobile phone. Mobile banking today (2007) is most often performed via SMS or the Mobile

Internet but can also use special programs called clients downloaded to the mobile device.

Internet Banking:

Online banking (or Internet banking) allows customers to conduct financial transactions on a

secure website operated by their retail or virtual bank, credit union or building society.

Core Banking System:

Core Banking is a general term used to describe the services provided by a group of networked

bank branches. Bank Customers may access their funds and other simple transactions from any

of the menber branch offices.

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ATM :

An automated teller machine (ATM) is a computerized telecommunications device that provides

the customers of a financial institution with access to financial transactions in a public space

without the need for a human clerk or bank teller. On most modern ATMs, the customer is

identified by inserting a plastic ATM card with a magnetic stripe or a plastic smartcard with a

chip, that contains a unique card number and some security information, such as an expiration

date or CVC (CVV). Security is provided by the customer entering a personal identification

number (PIN).

Using an ATM, customers can access their bank accounts in order to make cash withdrawals (or

credit card cash advances) and check their account balances as well as purchasing mobile cell

phone prepaid credit. ATMs are known by various other names including automated banking

machine, money machine, bank machine, cash machine, hole-in-the-wall, cashpoint, Bancomat

(in various countries in Europe and Russia), Multibanco (after a registered trade mark, in

Portugal), and Any Time Money (in India).

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DEFINITION OF BANK  

The Oxford dictionary defines the Bank as,

“An establishment for the custody of money, which it pays out, on a customer’s order.”

According to Whitehead,

“A Bank i s de f ined as an ins t i tu t ion which co l lec t s surplus funds   f rom the

publ ic , sa feguards them, and makes them avai lable to the t rue owner when

required and also lends sums be their true owners to those who are in need of funds and can

provide security.”

Banking Company in India has been defined in the Banking Companies act1949,“ O n e w h i c h

t r a n s a c t s t h e b u s i n e s s o f b a n k i n g w h i c h m e a n s t h e accepting, for the

purpose of lending or investment of the deposits of money from the public, repayable on

demand, or otherwise and withdraw able be cheque, draft, order or otherwise.”

The banking sys tem i s an in tegra l subsys tem of the f inancia l sys tem. I t

r e p r e s e n t s a n i m p o r t a n t c h a n n e l o f c o l l e c t i n g s m a l l s a v i n g s f r o m t h e

households and lending it to the corporate sector. The Indian bank ing sys tem has

Reserve Bank of Ind ia (RBI) as the apex  body for all matters relating to the banking

system. It is the central Bank of India. It is also known as the Banker to All Other Banks.

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EVOLUTION OF INDIAN BANKING

Ancient banking system of India constituted of indigenous bankers. They have been

carrying on their age-old banking operations in different parts of the country under different

names. The modern age of banking constitutes the fundamental basis of economic

growth. The term Bank is being used s ince long t ime but the re i s no c lea r

concep t ion regarding i t s beg inning. According to the viewpoint, in good old

days. Italian money leaders were known as “Banchi” because they kept a special type of

table to transact their business.

IMPORTANCE OF BANKS

Today banks have become a part and parcel of Kotak Bank's life. There was a time when

dwellers of the city alone could enjoy their services. Now banks Offe r access to even a

common man and the i r ac t iv i t i e s extend to a reas h i t h e r t o u n t o u c h e d .

B a n k s c a t e r t o t h e n e e d s o f a g r i c u l t u r a l i s t s , industrialists,

traders and to all the other sections of the society. In modern age , the banking

cons t i tu tes the fundamenta l bas i s o f economic growth . Thus, they accelerate the

economic growth of a country and steer the wheels of the economy towards its goals of

“self reliance in all fields”. It naturally arouses Kotak Bank's interest in knowing

more about the ‘Bank’ and the various men and the activities connected with it.

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Indian Banking System

Banking in India has its origin as early as the Vedic period. It was believed that transition from

money lending to banking must have occurred even before Manu, The great Hindu Jurist, who

has devoted a section of his work to deposit advance and laid down rules relating to rates of

interest. During the Mogul period, the indigenous Bankers played a very important role in

lending money financing foreign trade and commerce. During the days of East India Company, it

was turning over the agency houses to carry on the business. “The General Bank of India” was

the first to join sector in the year 1786.The others that followed were the Bank of Hindustan and

the Bengal bank. The bank of Hindustan is reported to have continued till 1906 while the other

two failed in the mean time. In the first half of the 19 th century the East India Company

established three banks:

1. Bank of Bengal (1809).

2. Bank of Bombay (1840).

3. Bank of Madras (1843.

These three banks are also known as Presidency Banks were independent units and functioned

well. These three banks were amalgamated in 1920 and Imperial Bank of India was established

on 27th January 1921, which started as private shareholders banks, mostly Europeans

shareholders, with the passing of time Imperial bank was taken over by the newly constituted

State bank of India act in1955.In 1865 Allahabad Bank was established and first time exclusively

by Indians, Punjab National Bank Ltd. was set up in1894 with headquarters at Lahore. Between

1906 and 1913, Bank of India, Central Bank of India, Bank of Baroda, Canara Bank, Indian

Bank, and Bank of Mysore were set up. Reserve Bank of India came in 1935. On July, 1969, 14

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major banks of India were nationalized and on 15th April, 1980 six more commercial private

banks were also taken over by the government.

Reserve Bank of India

The Banking system is an integral sub-system of the financial system. It represents an important

channel of collecting small savings from the households and lending it to the corporate sector.

The Indian banking system has The Reserve Bank of India (RBI) as the apex body from all

matters relating to the banking system. It’s the “Central Bank” of India and act as the banker to

all other banks.

Functions of RBI:

• Currency issuing authority

• Banker to the government.

• Banker to other Bank.

• Framing of monetary policy.

• Exchange control.

•Custodian to foreign exchange and gold reserves.

• Development activities.

• Research and development in the banking sector. 

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1.3 STRUCTURE OF BANKING SYSTEM

Different countries of the world have different types of banking systems. However, commercial

banking had grown under all these banking systems. To understand the structure of banking

system, let us take up various types of banking systems one by one. These types are:

(1) UNIT BANKING: Unit Banking originated in the United State of America. It grew in the

United States of America. As a counter part of independent or industrial units.

“An independent unit bank is a corporation that operates one office and that is not related

to other banks through either ownership or control.’’

Shaper, Solomon and White.

Thus under unit banking, a single bank is a complete organization in itself having its own

management. The scale of operation is small and the area is restricted to a locality only. Unit

banking is localized banking and is much more responsive to the needs of the locality. It has

better understanding of the local problems and conditions, which helps it to cater to the needs of

the area in a better way. The staff of the unit bank is generally local and is in a better position to

determine the standing or desirability of the customers. The failure of the unit bank will not

endanger the banking system and economy. It is free from the difficulties and diseconomies of

large scale operations. It will not drain out the financial resources of villages and small towns to

big industrial centers and will ensure a balanced growth.

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OBJECTIVES OF THE STUDY

To find out the customer preferences while opening Savings A/c.

To increase the business of the bank.

To find out the comparison of ICICI bank with HDFC bank on various

attributes

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SCOPE & IMPORTANCE

Indian banks have a long way to go before they reach the size of their international counterparts.

Even the biggest Indian bank, State Bank of India, is nowhere on the international scale, with

assets in the range of $50billion. Absence of significant scale benefits and higher implicit costs

of several services are perpetuating the poor ranking of Indian banks in the international league

tables.

Shareholding structure, government regulations and sheer size of the country ensure that the

existence of Indian banks is not at stake at this stage. What is at stake is the banking support that

is available for Indian economic activity, and thereby the international competitiveness of

various sectors. What is also at stake is the scope for the banking industry to earn superior

returns through differentiated wider services.

Further, it is quite conceivable that with passage of time, as government holding in banks is

progressively divested, regulatory authorities will be unable to hold back the international giants

from buying out Indian banks. Even economies with a "domestic mindset", such as France and

Germany, have been forced to bow before the international capital market forces.

It would be a shame if painstakingly built retail strength is offered on a platter to some predator.

The challenge can be met through some concerted action -

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LITRATURE REVIEW

a.) Origin and development of the industry:-

Banking in India originated in the first decade of 18th century. The first banks were The General

Bank of India, which started in 1786, and 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 "The

Bank of Bengal" in Calcutta in June 1806. This was one of the three presidency banks, the other

two being the Bank of Bombay and the Bank of Madras. The presidency banks were established

under charters from the British East India Company. They merged in 1925 to form the Imperial

Bank of India, which, upon India's independence, became the State Bank of India. For many

years the Presidency banks acted as quasi-central banks, as did their successors. The Reserve

Bank of India formally took on the responsibility of regulating the Indian banking sector from

1935. After India's independence in 1947, the Reserve Bank was nationalized and given broader

powers.

A couple of decades later, foreign banks such as Credit Lyonnais started their Calcutta

operations in the 1850s. At that point of time, Calcutta was the most active trading port, mainly

due to the trade of the British Empire, and due to which banking activity took roots there and

prospered.

First of all we must note the fact that these institutions have changed very much in character

since their origin, and consequently nowadays perform many functions unknown to those of

former times. The first banks seem to have arisen in connection with the business of

exchanging money. In ancient times and especially in the Middle Ages the varieties of coins

were greater even than at the present day, and they were much less perfectly and honestlyminted.

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Specialists were, therefore, required to determine their exact value and equivalence and to

exchange coins of one mintage for those of another, and their BANK were in great demand at

fairs and other places where merchants of different nations met for purposes of trade. In as much

as they kept their boxes or chests of coins on benches or "banken," the name bankers came to be

applied to them. On account of their technical knowledge and the fact that they were obliged

constantly to keep on hand considerable quantities of the precious metals, this business in the

early Middle Ages was usually carried on by goldsmiths, but later it was sometimes assumed by

the governments of large commercial cities, as, for example, by Amsterdam in 1609, by

Hamburg in 1619, and by Nurnberg in 1621. Of these latter the Bank of Amsterdam was the

most important and may be regarded as typical of these early institutions.

From the earliest times also, bankers have been the chief agents through which foreign

exchanges have been conducted. As dealers in coin and bullion they had international

connections and a knowledge of international affairs not possessed by other merchants, and

were, therefore, in a position to undertake the settlement of international accounts by means of

orders drawn on bankers in other countries or other cities with whom they had regular business

transactions. As keepers of other people's money they also promoted saving, and banks thus

became in time the chief savings institutions of the country.

b. Growth and present status of the industry:-

Currently (2009), 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

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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.

Currently, India has 88 scheduled commercial banks (SCBs) - 27 public sector banks (that is

with the Government of India holding a stake)after merger of New Bank of India in Punjab

National Bank in 1993, 29 private banks (these do not have government stake; they may be

publicly listed and traded on stock exchanges) and 31 foreign banks. They have a combined

network of over 53,000 branches and 17,000 ATMs. According to a report by ICRA Limited, a

rating agency, the public sector banks hold over 75 percent of total assets of the banking

industry, with the private and foreign banks holding 18.2% and 6.5% respectively

Introduction of many more products and facilities in the banking sector in its reforms measure. In

1991, under the chairmanship of M Narasimham, a committee was set up by his name which

worked for the liberalization of banking practices.

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The country is flooded with foreign banks and their ATM stations. Efforts are being put to give

a satisfactory service to customers. Phone banking and net banking is introduced. The entire

system became more convenient and swift. Time is given more importance than money.

In 1995, the Brookings Institution published a paper entitled “The Transformation of the U.S.

Banking Industry: What a Long, Strange Trip It’s Been.”  Using a breathtaking array of facts and

figures, the paper described in great detail the dramatic changes that had occurred in the U.S.

commercial banking industry over the 15 years from 1979 to 1994.  The banking industry was

transformed during that period, according to the paper (p. 127), by “the massive reduction in the

number of banking organizations; the significant increase in the number of failures; the dramatic

rise in off-balance sheet activities; the major expansion in lending to U.S. corporations by

foreign banks; the widespread adoption of ATMs; .and the opening up of interstate banking

markets.” The paper went on to explain that most of these major changes in banking could be

traced to two developments: (1) the extraordinary number of major regulatory changes during the

period,from deposit deregulation in the early 1980s to the relaxation of branching restrictions

later in the decade; and (2) clearly identifiable innovations in technology and applied finance,

including improvements in information processing and telecommunication technologies, the

securitization and sale of bank loans, and the development of derivatives markets. Other research

would later confirm the paper’s assessments and its explanation of the course of events in the

banking industry over the period 1979–1994.

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Over the two decades 1984–2003, the structure of the U.S. banking industry indeed underwent

an almost unprecedented transformation—one marked by a substantial decline in the number of

commercial banks and savings institutions and by a growing concentration of industry assets

among a few dozen extremely large financial institutions.  This is not news. As mentioned above,

the decline in the number of banking organizations has been ongoing for more than two decades

and has been well documented in the literature. Nevertheless, a brief overview will serve to

clarify both the scope of the decline and the increasing concentration of assets among the

nation’s largest banking organizations.

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COMPANY PROFILE

HDFC BANK

HDFC Bank is India's second-largest bank with total assets of Rs. 3,849.70 billion

(US$ 82 billion) at September 30, 2008 and profit after tax Rs. 17.42 billion for the half year

ended September 30, 2008. The Bank has a network of about 1,400 branches and 4,530 ATMs in

India and presence in 18 countries. HDFC Bank offers a wide range of banking products and

financial services to corporate and retail customers through a variety of delivery channels and

through its specialized subsidiaries and affiliates in the areas of investment banking, life and

non-life insurance, venture capital and asset management. The Bank currently has subsidiaries in

the United Kingdom, Russia and Canada, branches in United States, Singapore, Bahrain, Hong

Kong, Sri Lanka, Qatar and Dubai International Finance Centre and representative offices in

United Arab Emirates, China, South Africa, Bangladesh, Thailand, Malaysia and Indonesia. Our

UK subsidiary has established branches in Belgium and Germany.

HDFC Bank's equity shares are listed in India on Bombay Stock Exchange and the National

Stock Exchange of India Limited and its American Depositary Receipts (ADRs) are listed on the

New York Stock Exchange (NYSE).

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History:

HDFC Bank was originally promoted in 1994 by HDFC Limited, an Indian financial institution,

and was its wholly-owned subsidiary. HDFC's shareholding in HDFC Bank was reduced to 46%

through a public offering of shares in India in fiscal 1998, an equity offering in the form of

ADRs listed on the NYSE in fiscal 2000, HDFC Bank's acquisition of Bank of Madura Limited

in an all-stock amalgamation in fiscal 2001, and secondary market sales by HDFC to institutional

investors in fiscal 2001 and fiscal 2002. HDFC was formed in 1955 at the initiative of the World

Bank, the Government of India and representatives of Indian industry.

The principal objective was to create a development financial institution for providing medium-

term and long-term project financing to Indian businesses. In the 1990s, HDFC transformed its

business from a development financial institution offering only project finance to a diversified

financial services group offering a wide variety of products and services, both directly and

through a number of subsidiaries and affiliates like HDFC Bank. In 1999, HDFC become the

first Indian company and the first bank or financial institution from non-Japan Asia to be listed

on the NYSE.

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HDFC BANK DEPOSIT SCHEMES

An easy-to-operate savings account that allows you to issue cheques, draw Demand Drafts and

withdraw cash. Check up on your balances from the comfort of your home or office through

NetBanking, PhoneBanking and MobileBanking.  

Need money urgently? Withdraw cash from any of the 3,573 ATM centres spread across the

country.     

Features & Benefits

Wide network of branches and over thousand ATMs to meet all your banking needs no matter

where you are located.

Bank conveniently with facilities like NetBanking and MobileBanking- check your account

balance, pay utility bills or stop cheque payment, through SMS.

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Never overspend- Shop using your International Debit Card that reflects the actual balance in

your savings account.

Personalised cheques with your name printed on each cheque leaf for enhanced security.

Take advantage of BillPay, an instant solution to all your frequent utility bill payments.

Instruct for payment over the phone or through the Internet.

Avail of facilities like Safe Deposit Locker, Sweep-In and Super Saver facility on your

account.

Free cash withdrawals on any other Bank's ATM

Free Payable-at-Par chequebook, without any usage charges upto a limit of Rs.50,000/- per

month.

Free InstaAlerts for all account holders for lifetime of the account.

Free Passbook facility available at home branch for account holders (individuals).

Introducing the best banking option for you with HDFC Bank Savings Plus Account. Now you

can get access to some of the finest banking facilities with HDFC Bank's Savings Plus Account.

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All you have to do is maintain an Average Quarterly Balance of Rs. 10,000/- and experience the

benefits as mentioned below:

Features & Benefits

Wide network of branches and over thousand ATMs to meet all your banking needs no matter

where you are located.

Free cash withdrawals on any other Bank's ATM*.

Free International Debit Card for all account holders for life time of the account.

Free Payable-at-Par (PAP) chequebook, without any usage charges upto a limit of Rs. 50,000

per month. Above Rs. 50,000, charge of Rs.2.90/- per Rs. 1,000/- on the full amount.

Free Demand Drafts on HDFC Bank locations, upto a limit of 25,000/- per day.

Free BillPay & InstaAlerts for all account holders for lifetime of the account

Free Electronic Funds Transfer facility, NetBanking, PhoneBanking & MobileBanking

Special relationship discount on purchase of Gold Bars

25%-off on the Locker rental for the 1st year (only).

Intercity Banking / Multi-city Banking.

Free Passbook facility available at home branch for account holders (individuals).

Free Email Statement facility.

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Company Profile

ICICI Bank Ltd is a major banking and financial services organization in India. The Bank is

the second largest bank in India and the largest private sector bank in India by market

capitalization. They are a publicly held banking company engaged in providing a wide range

of banking and financial services including commercial banking and treasury operations. The

Bank and their subsidiaries offers a wide range of banking and financial services including

commercial banking, retail banking, project and corporate finance, working capital finance,

insurance, venture capital and private equity, investment banking, broking and treasury

products and services. They offer through a variety of delivery channels and through their

specialised subsidiaries in the areas of investment banking, life and non-life insurance,

venture capital and asset management. The Bank has a network of 2,035 branches and about

5,518 ATMs in India and presence in 18 countries. They have subsidiaries in the United

Kingdom, Russia and Canada, branches in United States, Singapore, Bahrain, Hong Kong, Sri

Lanka, Qatar and Dubai International Finance Centre and representative offices in United

Arab Emirates, China, South Africa, Bangladesh, Thailand, Malaysia and Indonesia. Our UK

subsidiary has established branches in Belgium and Germany. The Bank's equity shares are

listed in India on Bombay Stock Exchange and the National Stock Exchange of India Limited

and their American Depositary Receipts (ADRs) are listed on the New York Stock Exchange.

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The Banks is the first Indian Bank listed on New York Stock Exchange. ICICI Bank Ltd was

incorporated in the year 1994 as a part of the ICICI group with the name ICICI Banking

Corporation Ltd. The initial equity capital was 75.0% by ICICI and 25.0% by SCICI Ltd, a

diversified finance and shipping finance lender of which ICICI owned 19.9% at December

1996. Pursuant to the merger of SCICI into ICICI, ICICI Bank became a wholly-owned

subsidiary of ICICI. In September 10, 1999, the name of the Bank was changed from ICICI

Banking Corporation Ltd to ICICI Bank Ltd In March 10, 2001, ICICI Bank acquired Bank of

Madura, an old private sector bank, in an all-stock merger. ICICI Ltd along with their wholly

owned retail finance subsidiaries, namely ICICI Capital Services Ltd and ICICI Personal

Financial Services Ltd amalgamated with the Bank with effect from May 3, 2002. In May

2003, the bank acquired the entire paid-up capital of Transamerica Apple Distribution

Finance Pvt Ltd (now known as ICICI Distribution Finance Pvt Ltd) which primarily engaged

in financing in the two-wheeler segment. In September 12, 2003, the Bank incorporated ICICI

Bank Canada as a 100% subsidiary company. In May 2005, the Bank acquired the entire paid-

up capital of Investitsionno-Kreditny Bank, a Russian bank with their registered office in

Balabanovo in the Kaluga region and a branch in Moscow. Thus, IKB became a subsidiary of

Bank with effect from May 19, 2005. In August 2005, the Bank acquired additional 6% of the

equity share capital of Prudential ICICI Asset Management Company Ltd and Prudential

ICICI Trust Ltd from Prudential Corporation Holdings Ltd and thus these two companies

became the subsidiaries of the Bank. During the year 2006-07, ICICI Bank Canada

incorporated ICICI Health Management Inc as a subsidiary company. In April 2007, Sangli

Bank Ltd merged with the Bank with effect from April 19, 2007. In 2007 June, the Bank

entered into an agreement with networking solutions provider GTL Ltd to lease out their call

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centre facility at Mahape worth of around Rs 100 crore for a period of 25 years. During the

year 2007-08, the Bank increased their branches & extension counter from 755 Nos to 1,262

Nos, including the addition of about 200 branches through the merger of Sangli Bank. They

increased their ATM network from 3,271 ATMs to 3,881 ATMs. They launched mobile

banking service enabling a wide range of banking transactions using the mobile phone.

During the year 2008-09, the Bank increased their branches & extension counter from 1,262

Nos to 1,419 Nos. They also received licenses for 580 additional branches from RBI. They

increased their ATM network to 4,713 ATMs from 3,881 ATMs. In April 22, 2009, ICICI

Prudential Pension Funds Management Company Ltd was incorporated as a subsidiary

company of ICICI Prudential Life Insurance Company Ltd. During the year 2009-10, the

Bank increased their branches & extension counter from 1,419 Nos to 1,707 Nos. They also

increased their ATM network from 4,713 ATMs to 5,219 ATMs. ICICI Wealth Management

Inc., a subsidiary of ICICI Bank Canada, has been dissolved effective December 31, 2009. In

January 2010, the Bank and First Data, a company engaged in electronic commerce and

payment services, formed a merchant acquiring alliance and a new entity named ICICI

Merchant Services, 81% owned by First Data, was formed, which acquired ICICI Bank's

merchant acquiring operations for a total consideration of Rs.3,744 million. In May 2010, the

Bank approved the scheme of amalgamation of Bank of Rajasthan Ltd with the Bank through

share-swap in a non-cash deal that values the Bank of Rajasthan at about Rs 3,000 crore. Each

118 shares of Bank of Rajasthan will be converted into 25 shares of ICICI Bank Ltd. In

August 2010, as per the scheme of amalgamation, Bank of Rajasthan was amalgamated with

the Bank with effect from the close of business on 12 August 2010. The merger of Bank of

Rajasthan added over 450 branches to the network. Including these, their branch network

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increased from 1,707 branches at March 31, 2010 to 2,529 branches at March 31, 2011. They

also increased their ATM network from 5,219 ATMs at March 31, 2010 to 6,055 ATMs at

March 31, 2011.

ICICI Group Companies

ICICI Group- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -ICICI Prudential Life Insurance Company

- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -ICICI Securities

- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -ICICI Lombard General Insurance Company

- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -ICICI Prudential AMC & Trust

- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -ICICI Venture

ICICI Direct

ICICI Foundation

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History

ICICI Bank was originally promoted in 1994 by ICICI Limited, an Indian financial institution,

and was its wholly-owned subsidiary. ICICI's shareholding in ICICI Bank was reduced to 46%

through a public offering of shares in India in fiscal 1998, an equity offering in the form of

ADRs listed on the NYSE in fiscal 2000, ICICI Bank's acquisition of Bank of Madura Limited

in an all-stock amalgamation in fiscal 2001, and secondary market sales by ICICI to

institutional investors in fiscal 2001 and fiscal 2002. ICICI was formed in 1955 at the initiative

of the World Bank, the Government of India and representatives of Indian industry. The

principal objective was to create a development financial institution for providing medium-term

and long-term project. 

In the 1990s, ICICI transformed its business from a development financial institution offering

only project finance to a diversified financial services group offering a wide variety of products

and services, both directly and through a number of subsidiaries and affiliates like ICICI

Bank.. 

After consideration of various corporate structuring alternatives in the context of the emerging

competitive scenario in the Indian banking industry, and the move towards universal banking,

the managements of ICICI and ICICI Bank formed the view that the merger of ICICI with

ICICI Bank would be the optimal strategic alternative for both entities, and would create the

optimal legal structure for the ICICI group's universal banking strategy. The merger would

enhance value for ICICI shareholders through the merged entity's access to low-cost deposits,

greater opportunities for earning fee-based income and the ability to participate in the payments

26

system and provide transaction-banking services. The merger would enhance value for ICICI

Bank shareholders through a large capital base and scale of operations, seamless access to

ICICI's strong corporate relationships built up over five decades, entry into new business

segments, higher market share in various business segments, particularly fee-based services,

and access to the vast talent pool of ICICI and its subsidiaries. 

In October 2001, the Boards of Directors of ICICI and ICICI Bank approved the merger of

ICICI and two of its wholly-owned retail finance subsidiaries, ICICI Personal Financial

Services Limited and ICICI Capital Services Limited, with ICICI Bank. The merger was

approved by shareholders of ICICI and ICICI Bank in January 2002, by the High Court of

Gujarat at Ahmedabad in March 2002, and by the High Court of Judicature at Mumbai and the

Reserve Bank of India in April 2002. Consequent to the merger, the ICICI group's financing

and banking operations, both wholesale and retail, have been integrated in a single entity. 

ICICI Bank has formulated a Code of Business Conduct and Ethics for its directors and

employees

27

28

RESEARCH METHODOLOGY

1. RESEARCH

The term research is also used to describe an entire collecting information about a

particular subject.

2.RESEARCH METHODOLOGY

Research methodology is defined as human activity based on intellectual application in

the investigation of matter. The primary purpose for applied research is discovering,

interepting,and the development of methods &system for the advancement of human

knowledge on wide variety of scientific matters of our world and the universe.

TYPES OF RESEARCH

QUANTIATIVE RESEACH

n the social sciences, quantitative research refers to the systematic empirical investigation of

quantitative properties and phenomena and their relationships. The objective of quantitative

research is to develop and employ mathematical models, theories and/or hypotheses pertaining to

phenomena. The process of measurement is central to quantitative research because it provides

the fundamental connection between empirical observation and mathematical expression of

quantitative relationships.

29

Quantitative research is used widely in social sciences such as psychology, economics,

anthropology, and political science. Research in mathematical sciences such as physics is also

'quantitative' by definition, though this use of the term differs in context. In the social sciences,

the term relates to empirical methods, originating in both philosophical positivism and the

history of statistics, which contrast qualitative research methods.

Qualitative methods produce information only on the particular cases studied, and any more

general conclusions are only hypotheses. Quantitative methods can be used to verify, which of

such hypotheses are true.

QUALITATIVE RESEARCH

Qualitative research is a method of inquiry employed in many different academic disciplines,

traditionally in the social sciences, but also in market research and further contexts.[1] Qualitative

researchers aim to gather an in-depth understanding of human behavior and the reasons that

govern such behavior. The qualitative method investigates the why and how of decision making,

not just what, where, when. Hence, smaller but focused samples are more often needed, rather

than large samples.

Qualitative methods produce information only on the particular cases studied, and any more

general conclusions are only propositions (informed assertions). Quantitative methods can be

used to seek empirical support for such research hypotheses.

Research Objective: To find out the customer preferences while opening Savings A/c.

To study brand image of the bank.

To increase the business of the bank.

30

To find out the comparison of ICICI bank with HDFC bank on various

attributes

DATA COLLECTIN :

Primary data source: All the people from different profession were personally visited and

Interviewed. They were the main source of Primary data. The method of collection of primary

data was direct personal interview through a structured questionnaire.

Secondary Data Source: It was collected from internal sources. The secondary data was

collected on the basis of organizational file, official records, news papers, magazines,

management books, preserved information in the company’s database and website of the

company.

SAMPLING PLAN:

Since it is not possible to study whole universe, it becomes necessary to take sample from the

universe to know about its characteristics.

Sampling Units: Customers

Sample Technique: Random Sampling.

Research Instrument: Structured Questionnaire.

Contact Method: Personal Interview.

SAMPLE SIZE:

My sample size for this project was 100 respondents. Since it was not possible to cover the

whole universe in the available time period, it was necessary for me to take a sample size of 100

respondents.

31

FINDINGS AND ANALYSIS

The following information contains the data interpretation of the questionnaires. The respondent’s responses for the questions have been interpreted and a finding has been made based on the respondents responses.

Frequency table for the demographic details of the ICICI Bank respondent’s

Table 3.1

AGE OF THE RESPONDENTS

Frequency Percent

25YRS-35YRS 25 25

36YRS-45YRS 35 35

46YRS-55YRS 30 30

ABOVE 55YRS 10 10

Total 100 100

Graph: 3.1

From the above table 25% respondents are belonging to the age category of 25yrs-35yrs. And

35% respondents are belonging to the category of 36yrs-45yrs and 46yrs-55yrs. And 30%

respondents are belonging to the category of above 55yrs.

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Table 3.2

GENDER OF THE RESPONDENTS

Frequency Percent

FEMALE 60 60

MALE 40 40

Total 100 100

Graph: 3.2

Interpretation:

From the above table 60% respondents are belonging to the category of female. And the

remaining 40% respondents are belonging to the category of male

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Table 3.3

OCCUPATION OF THE RESPONDENTS

Frequency Percent

SALARIED PERSON 20 20

PROFESSIONALS 30 30

SUPERVISOR 40 40

MANAGERIAL 10 10

Total 100 100

Graph 3.3

Interpretation:

From the above table 20% of respondents are falling under the category of salaried person. And

30% of respondents are falling under the category of professionals and supervisor. And 10% of

respondents are belonging to the category of managerial.

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Table 3.4

INCOME LEVEL OF THE RESPONDENTS

Frequency Percent

Rs.5,000-Rs.15,000 40 40

Rs.15,001-Rs.25,000 30 30

Rs.25,001-Rs.35,000 20 20

Above Rs.45,000 10 10

Total 100 100

Graph 3.4

Interpretation:

From the above table 40% of respondents are falling under the income range between Rs.5, 000-

Rs.15, 000. And 30% are falling under the income range between Rs.15, 001-Rs.25, 000. And

20% of respondents are falling under the income range between Rs.25, 001-Rs.35, 000. And

20% of respondents are falling under the income range between Above Rs.45, 000.

35

Graph3.5.

Do you have a bank a/c?

Option Percentage

Yes 100

No 0

Interpretation:

From the above table 100% respondents have a Bank A/c

36

Graph3.6

In which bank do you have an account?

Option Percentage

HDFC Bank 55

Other Bank 45

Interpretation:

Out of 100 respondents 55% have a HDFC Bank A/c and 45% have a other bank A/c

37

Graph3.6

What is the reason to choose the services of the bank?

REASON TO CHOOSE THE SERVICE

Frequency Percent

EFFICIENT CUSTOMER SERVICE

20 20

TIME SAVING 35 25TRANSCATION COSTS 15 15

TECHNOLOGY 30 20

MORE ATMS 20 20Total 100 100

Graph 3.6

Interpretation:

From the above table35% of respondents are saying that the reason to choose ICICI is they are providing efficient customer service. And 25.8% of respondents are saying that the reason to choose ICICI is they are reducing our waiting time. And 9.7% of respondents are saying that the reason to choose ICICI is Transaction costs. And 3.2% of respondents are saying that the reason to choose ICICI is Technology. And 12.9% of respondents are saying that the reason to choose SBI is they are provided more ATM facility.

38

Graph3.7

What type of services do you prefer the most?

TYPE OF SERVICE PREFER THE MOST

Frequency Percent

ATM SERVICE 30 30

INTERNET BANKING 25 25

MOBILE BANKING 15 15

CORE BANKING SYSTEM 30 30

Total 100 100

Graph 3.7

Frequency table for the demographic details of the HDFC respondent’s

Interpretation:

39

From the above table 61.3% of respondents prefer the ATM service. And 9.7% of respondents

are preferred the internet banking and mobile banking. And 16.1% of respondents prefer the core

banking system.

Graph 3.8

If yes with whom you have a bank a/c HDFC, ICICI, SBI of any other specify.

Option Percentage

Scheme 10

Better service 75

High rate & interest 5

For any specified 10

Interpretation:

From the above table 10% respondents have a scheme , 75% have a better A/c, 5% have a High

rate & interest and 10% have a for any specified.

40

Graph3.9

. Specify a region for continuing Bank?

Option Percentage

HDFC BANK 60

ICICI BANK 40

Interpretation:

From the above table 60% have a HDFC Bank and 40% have a ICICI Bank A/c

41

Graph 3.10

. Do you want to continue with a consisted bank?

Option Percentage

YES 60

NO 40

Interpretation:

From the above table 60% say yes and 40% say No.

42

Graph 3.11.

Do HDFC provide home banking facility?

Option Percentage

YES 60

NO 40

Interpretation:

From the above table 60% say yes and 40% say No.

43

Graph3.12

.If yes what are the various factor which lead you to avail the facility of how bank?

Option Percentage

24 Hour 60

12 Hour 40

Interpretation:

From the above table 60% say 24 Hours and 40% say 12 Hours.

44

FINDINGS

Sum Of the respondents to choose the HDFC bank is because the bank is proving more

ATM facility to the customers.

And many of the respondents are saying the reason to choose the services of the HDFC

bank is because they are good in efficient customer service.

And the income level of the respondents who are having an account in HDFC bank

falling under the income level of Rs. 5,000 – Rs.15.000.

The age group of 25yrs – 35yrs respondents mostly is having an account in HDFC bank.

The both gender are equally having an account in HDFC bank.

And many of the respondents are not aware of the many services rendered by the HDFC

bank. The few are deposit of cash in ATM, request for cheque book in ATM, end of the

day balance in mobile, etc.

Sum Of the respondents to choose the HDFC Bank is because the bank is more

reliable to the customers.

And many of the respondents are saying the reason to choose the services of the

HDFC Bank is because they are good in efficient customer service and efficient

complaint handling.

And the income level of the respondents who are having an account in HDFC

Bank falling under the income level of Rs. 5,000 - Rs.15.000.

45

The age group of 25yrs - 35yrs respondents mostly is having an account in HDFC

Bank.

The male gender is mostly having an account in HDFC Bank.

And many of the respondents are not aware of the many services rendered by the

HDFC Bank. The few are deposit of cash in ATM, request for cheque book in ATM, end

of the day balance in mobile, etc.

46

CONCLUSION

Almost all the Banks offer similar features and facilities with their Savings accounts. There

are certain reasons for existing customers of Saving Account of any Bank to shift to another

Bank.

The level of service in terms of delivering whatever is promised, fast response in case of

problems, is the most important benefit that the customers seek, from the Bank they have a

Saving Account with.

1. Network reach and visibility of a Bank is a very important criterion for the customer

while opening a Saving Account. We can also conclude from our analysis that network

reach in terms of Branches and ATMs is directly proportional to the market share in

case of Private Players.

2. In case of a new customer, if a bank approaches it first for opening a Saving Account

with them, then there is a good chance for the bank of getting many future businesses and

cross sales from the deal.

3. Aggressive Marketing is the key to increasing the market share in this area, since the

market has a lot of potential both in terms of untapped market .

47

SUGGESTIONS

Since many of the respondents are not aware of there key services. The bank has to take

some initiatives.

The bank can post a list of services that they are rendered to the customers inside the bank

Premises.

And they can post demo of all these services in their bank website.

They can concentrate more on the respondents are falling under the age group 25yrs – 35yrs.

The HDFC Bank can concentrate on customer complaints handling.

The HDFC Bank can concentrate on the female gender.

The bank can also send a post to there customers by informing there services and how to

proceed with that and all details they can mention it in the post.

48

LIMITATIONS

Some of the limitations of the project are listed as below:

1. The time bound period is the major limitation in research projects.

2. Due to the financial and time constraints a cluster analysis of the population so as to get

better results was not feasible.

3. The research conduct in Moradabad city only.

4. It was difficult to break the ice with the common people initially. It was a daunting task

to

Convince them to fill in the personal details of the questionnaire where they have to

mention the monthly income, occupation etc.

5. To convince the people for a proper interviewing process is also difficult.

6. Compilation of data on competitor analysis was difficult due to non-availability of correct

information.

7. The figures have been taken as approximations.

49

BIBLIOGRAPHY

Books;

1. Kothari. C.R., Research Methodology Methods & Techniques, Vishwas

Prakashan, edition 2003 New-Delhi,.

1. Kotler, Philip., Marketing Management, Pearson Education (Singapore) Pvt. Ltd,

11th edition new Delhi.

2. Varshney, R.L. & Bhattacharya, B., International Marketing Management, Sultan

Chand & Sons edition 2003 new delhi.

Websites:

www.hdfcbank.com

www.icicibank.com

Wikipedia.org/wiki/hdfCbank

Wikipedia.org/wiki/ICICI Bank

www.icicidirect.com.com/

50

QUESTIONNAIRE

Personal details

1. Name:

2. Age: a) □ 25yrs- 35 yrs b) □ 36 yrs - 45yrs c) □ 46 – 55 yrs d) □ above 55 yrs

3. Gender: a) Male □ b) Female □

4. Educational Qualification: a) Illiterate □ b) School □ c) UG □ d) PG □

e) Professional Course □ f) Others □

5. Occupation: a) House wife □ b) Students □ c) Salaried person □

d) Business man □ e) Professionals □ f) Supervisor □

g) Managerial □ h) pensioner □

6. Income level:

a) Rs.5,000 – Rs.15,000 b) Rs.15,001-Rs.25,000

c) Rs.25,001- Rs.35,000 d) Rs.35,001-Rs.45,000

e) Above Rs. 45,000

7.Do you have a bank a/c?

a) Yes b) No

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8. In which bank do you have an account?

a) HDFC BANK □ b) OTHER BANK □

9. What is the reason to choose the services of the bank?

a) Efficient customer service □ b) efficient complaints handling □

c) Time saving □ d) transaction costs □ e) technology

f) Others _________ pls specify

10. What type of services do you prefer the most?

a) ATM service b) Internet Banking c) Mobile Banking

d) Core banking system e) Others _____________ pals specify

11.If yes what are the various parameter for having a/c in HDFC?

a) Schemes b) Better service 3) High rate& interest 4) For any specified.

12. Specify a region for continuing Bank?

a) HDFC b) ICICI

13. Do you want to continue with a consisted bank?

a) Yes b) No.

14. Do you HDFC provide home banking facility?

a) Yes b) No.

15.If yes what are the various factor which lead you to avail the facility of how bank?

a) 24hour b) 12hour.

52