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7/29/2019 Final Project of sbi n icici
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A PROJECT REPORT
ON
A COMPARATIVE STUDY OF BANKING
SERVICES OF SBI AND ICICI
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CONTENTS
01 Introduction to the banks
02 Objective of the study
03 Methodology
04 Observation and Findings
05 Conclusion
06 Limitations
07 Bibliography
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INTRODUCTION TO
BANKS
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Introduction of SBI (State bank of India):
The State Bank of India, the countrys oldest Bank and a premier in terms of
balance sheet size, number of branches, market capitalization and profits is today
going through a momentous phase of Change and Transformation the two
hundred year old Public sector behemoth is today stirring out of its Public Sector
legacy and moving with an ability to give the Private and Foreign Banks a run for
their money. The origin of the state bank of India goes back to the first decade of
the nineteenth century with the establishment of the Bank of Calcutta in Calcutta
on 2 June 1806.
The bank is operating into many businesses with strategic tie ups Pension
Funds, General Insurance, Custodial Services, Private Equity, Mobile Banking,
Point of Sale Merchant Acquisition, Advisory Services, structured products etc
each one of these initiatives having a huge potential for growth.
It is also focusing at the top end of the market, on whole sale banking
capabilities to provide Indias growing mid / large Corporate with a complete array
of products and services. It is consolidating its global treasury operations and
entering into structured products and derivative instruments. Today, the Bank is the
largest provider of infrastructure debt and the largest arranger of external
commercial borrowings in the country. It is the only Indian bank to feature in the
Fortune 500 list.
SBI have about 8500 of its own 10000 branches and another 5100 branches
of its Associate Banks, today it offers the largest banking network to the Indian
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customer. The Bank is also in the process of providing complete payment solution
to its clientele with its over8500 ATMs.
It presently has 52 foreign offices in 34 countries across the globe. It has
also 5 Subsidiaries in IndiaSBI Capital Markets- SBICAP Securities, SBI DFHI,
SBI Factors and Commercial Services Pvt Ltd (SBI FACTORS), SBI Funds
Management Pvt Ltd (SBI FUNDS) and SBI Cards & Payments Services Pvt. Ltd.
(SBICPSL) - forming a formidable group in the Indian Banking scenario. It is in
the process of raising capital for its growth and also consolidating its various
holdings
Introduction of ICICI:
ICICI Bank was originally promoted in 1994 by ICICI Limited, an Indianfinancial 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.
ICICI Bank is India's second-largest bank with total assets of Rs. 3,997.95
billion at March 31, 2008. The Bank has a network of about 1,308 branches and
3,950 ATMs in India and presence in 18 countries. ICICI 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
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Kingdom, Russia and Canada, branches in Unites 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.
ICICI 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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INTODUCTION TO THE TOPIC
Personal Banking:-
Personal banking refers to banking in which a person can dotransaction and deposits with the banks for their personal expense.
OBJECTIVE OF THE STUDY
My objective was to find out the banking services of SBI and ICICI to find
out the advantage of SBI over ICICI and vice-versa.
For this I have to find various scheme provided by SBI and ICICI.
METHEDOLOGY
Primary Data is taken from Mr. Amit Yadav (manager in SBI) ManojKumar(staff in ICICI )
Secondary data is taken by internet
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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 banks,
as did their successors. The three banks merged in 1925 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 itfailed 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. 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 Comptoire d'Escompte de Paris opened a branch in Calcutta in 1860, and
another in Bombay in 1862; branches in Madras and Pondicherry, then a Frenchcolony, followed. Calcutta was the most active trading port in India, mainly due to
the trade of the British Empire, and so became a banking center.
http://en.wikipedia.org/wiki/Bank_of_Bengalhttp://en.wikipedia.org/wiki/Bank_of_Bombayhttp://en.wikipedia.org/wiki/Bank_of_Madrashttp://en.wikipedia.org/wiki/Bank_of_Madrashttp://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/Allahabad_Bankhttp://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/w/index.php?title=Comptoire_d%27Escompte_de_Paris&action=edit&redlink=1http://en.wikipedia.org/wiki/Mumbaihttp://en.wikipedia.org/wiki/Chennaihttp://en.wikipedia.org/wiki/Pondicheryhttp://en.wikipedia.org/wiki/British_Rajhttp://en.wikipedia.org/wiki/British_Rajhttp://en.wikipedia.org/wiki/Pondicheryhttp://en.wikipedia.org/wiki/Chennaihttp://en.wikipedia.org/wiki/Mumbaihttp://en.wikipedia.org/w/index.php?title=Comptoire_d%27Escompte_de_Paris&action=edit&redlink=1http://en.wikipedia.org/wiki/Kolkatahttp://en.wikipedia.org/wiki/Confederate_Stateshttp://en.wikipedia.org/wiki/Lancashirehttp://en.wikipedia.org/wiki/American_Civil_Warhttp://en.wikipedia.org/wiki/Allahabad_Bankhttp://en.wikipedia.org/wiki/Allahabad_Bankhttp://en.wikipedia.org/wiki/Imperial_Bank_of_Indiahttp://en.wikipedia.org/wiki/Imperial_Bank_of_Indiahttp://en.wikipedia.org/wiki/Bank_of_Madrashttp://en.wikipedia.org/wiki/Bank_of_Madrashttp://en.wikipedia.org/wiki/Bank_of_Bombayhttp://en.wikipedia.org/wiki/Bank_of_Bengal7/29/2019 Final Project of sbi n icici
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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 served particular ethnic and
religious communities.
The presidency banks dominated banking in India but there were also some
exchange banks and a number of Indian joint stockbanks. All these banks operated
in different segments of the economy. The exchange banks, mostly owned byEuropeans, 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."
By the 1900s, the market expanded with the establishment of banks such as
Punjab National Bank, in 1895 in Lahore and Bank of India, in 1906, in Mumbai -
both of which were founded under private ownership. Punjab National Bank is the
first Swadeshi Bank founded by the leaders like Lala Lajpat Rai, Sardar Dyal
Singh Majithia. The Swadeshi movement in particular inspired local businessmen
and political figures to found banks of and for the Indian community. A number ofbanks established then have survived to the present such as Bank of India,
Corporation Bank, Indian Bank,Bank of Baroda,Canara Bankand Central Bank
of India.The fervour of Swadeshi movement lead to establishing of many private
banks in Dakshina Kannada and Udupi district which were unified earlier and
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known by the name South Canara ( South Kanara ) district.Four nationalised
banks started in this district and also a leading private sector bank. Hence
undivided Dakshina Kannada district is known as "Cradle of Indian Banking".
From World War I to Independence:
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
that failed
Authorized capital
(Rs. Lakhs)
Paid-up Capital
(Rs. Lakhs)
1913 12 274 35
1914 42 710 109
1915 11 56 5
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1916 13 231 4
1917 9 76 25
1918 7 209 1
Post-independence:
The partition of India in 1947 adversely impacted the economies of Punjab 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 a mixed 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, wasnationalized, and it became an institution owned by the Government of
India.
In 1949, the Banking Regulation Act was enacted which empowered theReserve Bank of India (RBI) "to regulate, control, and inspect the banks in
India."
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The Banking Regulation Act also provided that no new bank or branch of anexisting bank could be opened without a license from the RBI, and no two
banks could have common directors.
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 nationalization of major banks in India on 19 July, 1969.
Nationalization:
By the 1960s, the Indian banking industry has become an important tool to
facilitate the development of the Indian economy. At the same time, it has emerged
as a large employer, and a debate has ensued about the possibility to nationalize 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 Nationalization."The paper was received
with positive enthusiasm. Thereafter, her move was swift and sudden, and the GOI
issued an ordinance and nationalized 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 Parliamentpassed the Banking Companies
(Acquisition and Transfer of Undertaking) Bill, and it received the presidential
approval on 9 August, 1969.
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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 nationalized banks from 20 to 19. After this, until the 1990s, the
nationalized banks grew at a pace of around 4%, closer to the average growth rate
of the Indian economy.
The nationalized banks were credited by some, including Home minister P.
Chidambaram, to have helped the Indian economy withstand the global financial
crisis of 2007-2009.
Liberalization:
In the early 1990s, the then Narsimha Rao government embarked on a policy
of liberalization, licensing a small number of private banks. These came to be
known asNew Generation tech-savvy banks, and included Global Trust Bank (the
first of such new generation banks to be set up), which later amalgamated with
Oriental Bank of Commerce, UTI Bank(now re-named as Axis Bank), ICICI Bank
and 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.
http://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/Home_Minister_of_Indiahttp://en.wikipedia.org/wiki/P._Chidambaramhttp://en.wikipedia.org/wiki/P._Chidambaramhttp://en.wikipedia.org/wiki/Economy_of_Indiahttp://en.wikipedia.org/wiki/Financial_crisis_of_2007-2009http://en.wikipedia.org/wiki/Financial_crisis_of_2007-2009http://en.wikipedia.org/wiki/Narsimha_Raohttp://en.wikipedia.org/wiki/Liberalizationhttp://en.wikipedia.org/wiki/UTI_Bankhttp://en.wikipedia.org/wiki/Axis_Bankhttp://en.wikipedia.org/wiki/ICICI_Bankhttp://en.wikipedia.org/wiki/HDFC_Bankhttp://en.wikipedia.org/wiki/Economy_of_Indiahttp://en.wikipedia.org/wiki/Economy_of_Indiahttp://en.wikipedia.org/wiki/HDFC_Bankhttp://en.wikipedia.org/wiki/ICICI_Bankhttp://en.wikipedia.org/wiki/Axis_Bankhttp://en.wikipedia.org/wiki/UTI_Bankhttp://en.wikipedia.org/wiki/Liberalizationhttp://en.wikipedia.org/wiki/Narsimha_Raohttp://en.wikipedia.org/wiki/Financial_crisis_of_2007-2009http://en.wikipedia.org/wiki/Financial_crisis_of_2007-2009http://en.wikipedia.org/wiki/Economy_of_Indiahttp://en.wikipedia.org/wiki/P._Chidambaramhttp://en.wikipedia.org/wiki/P._Chidambaramhttp://en.wikipedia.org/wiki/Home_Minister_of_Indiahttp://en.wikipedia.org/wiki/Punjab_National_Bankhttp://en.wikipedia.org/w/index.php?title=New_Bank_of_India&action=edit&redlink=17/29/2019 Final Project of sbi n icici
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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 49% 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
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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.
In recent years critics have charged that the non-government owned banks
are too aggresive 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.
Company Profile of SBI:
State Bank of India (SBI) is India's largest commercial bank. SBI has
a vast domestic network of over 9000 branches (approximately 14% of all bank
branches) and commands one-fifth of deposits and loans of all scheduled
commercial banks in India.
The State Bank Group includes a network of eight banking subsidiaries and several
non-banking subsidiaries offering merchant banking services, fund management,
factoring services, primary dealership in government securities, credit cards and
insurance.
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The eight banking subsidiaries are:
1-State Bank of Bikaner and Jaipur (SBBJ)2-State Bank of Hyderabad (SBH)
3-State Bank of India (SBI)
4-State Bank of Indore (SBIR)
5-State Bank of Mysore (SBM)
6-State Bank of Patiala (SBP)
7-State Bank of Saurashtra (SBS)
8-State Bank of Travancore (SBT)
The origins of State Bank of India date back to 1806 when the Bank
of Calcutta (later called the Bank of Bengal) was established. In 1921, the Bank of
Bengal and two other Presidency banks (Bank of Madras and Bank of Bombay)
were amalgamated to form the Imperial Bank of India. In 1955, the controlling
interest in the Imperial Bank of India was acquired by the Reserve Bank of India
and the State Bank of India (SBI) came into existence by an act of Parliament.
Today, State Bank of India (SBI) has spread its arms around the world
and has a network of branches spanning all time zones. SBI's International Banking
Group delivers the full range of cross-border finance solutions through its four
wings - the Domestic division, the Foreign Offices division, the Foreign
Department and the International Services division.
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State Bank of India (SBI) (LSE: SBID) is the largest bankin India. If one measures
by the number of branch offices and employees, SBI is the largest bank in the
world. Established in 1806 as Bank of Calcutta, it is the oldest commercial bank in
the Indian subcontinent. SBI provides various domestic, international and NRI
products and services, through its vast network in India and overseas. With an asset
base of $126 billion and its reach, it is a regional banking behemoth. The
government nationalized the bank in 1955, with the Reserve Bank of India taking a
60% ownership stake. In recent years the bank has focused on three
priorities, 1), reducing its huge staff through Golden handshake schemes known as
the Voluntary Retirement Scheme, which saw many of its best and brightest defect
to the private sector, 2), computerizing its operations and 3), changing the attitude
of its employees (through an ambitious programme aptly named 'Parivartan' which
means change) as a large number of employees are very rude to customers.
Roots:
The State Bank of India traces its roots to the first decade of 19th
century, when the Bank of Calcutta, later renamed the Bank of Bengal, was
established on 2 June 1806. The government amalgamated Bank of
Bengal and two other Presidency banks, namely, the Bank of Bombay
(incorporated on 15 April 1840) and the Bank of Madras on 27 January 1921, and
named the reorganized banking entity the Imperial Bank of India. All these
Presidency banks had been incorporated as joint stock companies, and were the
result of the royal charters. The Imperial Bank of India continued as a joint stock
company. Until the establishment of a central bank in India the Imperial Bank and
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its early predecessors served as India's central bank, at least in terms of issuing the
currency. The State Bank of India Act 1955, enacted by the Parliament of India,
authorized the Reserve Bank of India, which is the central banking organization of
India, to acquire a controlling interest in the Imperial Bank of India, which was
renamed the State Bank of India on 30 April 1955.
Timeline:
June 2, 1806: The Bank of Calcutta established.
January 2, 1809: This became the Bank of Bengal.
April 15, 1840: Bank of Bombay established.
July 1, 1843: Bank of Madras established.
1861: Paper Currency Act passed.
January 27, 1921: all three banks amalgamated to form Imperial Bank of
India.
July 1, 1955: State Bank of India formed; becomes the first
Indian bank to be nationalized.
1959: State Bank of India (Subsidiary Banks) Act passed,
enabling the State Bank of India to take over eight former State-
associated banks as its subsidiaries.
1980s When Bank of Cochin in Kerala faced a financial crisis,
the government merged it with State Bank of India.
June 29,2007: The Government of India today acquired the entire Reserve
Bank of India (RBI) shareholding in State Bank of India (SBI),
consisting of over 314 million equity shares at a total amount of over 355
billion rupees.
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Foreign Offices:
State Bank of India is present in 32 countries, where it has 84
offices serving the international needs of the bank's foreign customers, and in some
cases conducts retail operations. The focus of these offices is India-related
business.
Foreign Branches:
SBI has branches in these countries:
Australia
Bahrain
Belgium
Canada
Dubai
France
Germany
Hong Kong
IsraelJapan
Singapore
South Africa
U.K.
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U.S.A
Growth:
State Bank of India has often acted as guarantor to the Indian
Government, most notably during Chandra Shekhar's tenure as Prime Minister of
India. With more than 9400 branches and a further 4000+ associate bank branches,
the SBI has extensive coverage. Following its arch-rival ICICI Bank,
State Bank of India has electronically networked most of its metropolitan, urban
and semi-urban branches under its Core Banking System (CBS), with over 4500
branches being incorporated so far. The bank has the largest ATM
network in the country having more than 5600 ATMs [1]. The State
Bank of India has had steady growth over its history, though the Harshad Mehta
scam in 1992 marred its image. In recent years, the bank has sought to
expand its overseas operations by buying foreign banks. It is the only Indian bank
to feature in the top 100 world banks in the Fortune Global 500 rating and various
other rankings. According to the Forbes 2000 listing it tops all Indian companies.
Fortune Global 500 Ranking2007:
SBI debuted in the Fortune Global 500 at 498 in 2006. In 2007 it moved up
to 495. As per fortune 500-2007 following are the data for SBI in $ million.
Revenues 15,119.4. Profits 1,407.3. Assets 187,547.1. Stockholders' Equity
9,786.2
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Group companies:
SBI Capital Markets Ltd
SBI Mutual Fund (A Trust)
SBI Factors and Commercial Services Ltd
SBI DFHI Ltd
SBI Cards and Payment Services Pvt Ltd
SBI Life Insurance Co. Ltd - Bancassurance (Life Insurance)
SBI Funds Management Pvt LtdSBI Canada
Corporate Details:
State Bank of India is India's largest bank amongst all public and private sector
banks operating in India. State Bank of India owns and operates the following
subsidiaries and Joint Ventures
State Bank Of India Credit Card State Bank Of India Online State Bank Of India USA State Bank Of India Services State Bank Of India Mutual Funds State Bank Of India Branch State Bank Of India NRI Account
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Banking Subsidiaries:
State Bank of Bikaner and Jaipur (SBBJ) State Bank of Hyderabad (SBH) State Bank of Indore (SBI) State Bank of Mysore (SBM) State Bank of Patiala (SBP) State Bank of Saurashtra (SBS)
State Bank of Travancore (SBT)
Activities:
State Bank of India administrative structure is well equipped to oversee the
large network of branches in India and abroad. The State Bank of India 14 Local
Head Offices and 57 Zonal Offices are located at important cities spread
throughout the country. State Bank of India has 52 foreign offices in 34 countries
across the globe. The Corporate Accounts Group is a Strategic Business Unit of the
Bank set up exclusively to fulfill the specialized banking needs of top corporate in
the country.
The main activities of are into -
Personal Banking. NRI Services. Agriculture. International. Corporate. SME.
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State Bank of India offers the following services to its customers -
Domestic Treasury. SBI Vishwa Yatra Foreign Travel Card. Broking Services Revised Service Charge. ATM Services. Internet Banking. E-Pay. E-Rail. RBIEFT. Safe Deposit Lockers. Gift Cheques. MICR Codes. Foreign Inward Remittances.
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Profile of ICICI:
ICICI 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. ICICI 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.
ICICI 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:
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 financing to Indian businesses. 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 subsidiariesand affiliates like ICICI Bank. In 1999, ICICI 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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Important Highlights Of ICICI
The Boards of ICICI Ltd and ICICI Bank approved the merger of ICICI Ltd.with ICICI Bank.
ICICI Ltd merged with ICICI Bank Ltd to create Indias second-largest bankin terms of assets.
ICICI Bank launched Private Banking.
ATM-on-Wheels, Indias first mobile ATM, launched in Mumbai.
Mobile banking service in India launched in association with RelianceInfocomm.
Indias first multi-branded credit card with HPCL and Airtel launched. Kisan Loan Card and innovative, low-cost ATMs were launched in rural
India.
ICICI Bank and CNBC TV 18 announced Indias first ever awardsrecognizing the achievements of SMEs, a pioneering initiative to encourage
the contribution of Small and Medium Enterprises to the growth of the
Indian economy.
ICICI Bank opened its 500th branch in India. ICICI Bank introduced partnership model wherein ICICI Bank would forge
an alliance with existing micro finance institutions (MFIs). The MFI would
undertake the promotional role of identifying, training and promoting the
micro-finance clients and ICICI Bank would finance the clients directly on
the recommendation of the MFI.
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ICICI Bank introduced 8 to 8 Banking wherein all the branches of the Bankwould remain open from 8a.m. to 8 p.m. from Monday to Saturday.
ICICI Bank introduced the concept of floating rate for home loans in India. First rural branch and ATM launched in Uttar Pradesh at Delpandarwa,
Hardoi.
ICICI Bank and Visa jointly launched mChqa revolutionary credit cardon the mobile phone.
Private Banking Masters 2005, a nationwide Golf tournament for highnetworth clients of the Private Banking division launched. This event is the
largest domestic invitation amateur golf event conducted in India.
Becomes the first Indian company to make a simultaneous equity offering of$1.8 billion in India, the United States and Japan.
Acquired IvestitsionnoKreditny Bank of Russia. ICICI Bank became the largest bank in India in terms of its market
capitalization.
ICICI Bank became the first private entity in India to offer a discount toretail investors for its follow-up offer.
ICICI Bank became the first Indian bank to issue hybrid Tier-1 perpetualdebt in the international markets.
ICICI Bank subsidiary set up in Russia.
Introduced a new product - NRI smart save Deposits a unique fixeddeposit scheme for nonresident Indians.
Representative offices opened in Thailand, Indonesia and Malaysia. ICICI Bank became the largest retail player in the market to introduce a
biometric enabled smart card that allow banking transactions to be
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conducted on the field. A low-cost solution, this became an effective
delivery option for ICICI Banks micro-finance institution partners.
Financial counseling centre Disha launched. Disha provides free creditcounseling, financial planning and debt management services.
ICICI Bank makes a USD 2 billion three-tranche international bond offering,which becomes the largest bond offering by an Indian bank.
Sangli Bank was amalgamated with ICICI Bank. ICICI Bank enters USA, launches its first branch in New York ICICI Bank enters Germany, opens its first branch in Frankfurt
Personal Banking:
Deposits Loans Cards Investments Insurance Demat services Wealth management
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Business Banking:
Corporate net banking Cash Management Trade services SME services Online taxes Custodial services
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 Internetbut can also use special programs called
clients downloaded to the mobile device.
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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 orbuilding 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.
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 clerkorbank teller. Onmost 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).
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OBSERVATIONS & FINDINGS
SCHEMES PROVDED BY SBI:-
Terms deposit scheme Recurring deposits scheme Loans SBI SARAL Personal loan Education loan Car loan Home loan Medi-Plus loan
TERM DEPOSITS
Provide security, trust and competitive rate of interest. Flexibility in period of term deposit from 15 days to 10 years Affordable Low Minimum Deposit Amount: One can open a term deposit
with SBI for a nominal amount of Rs.1000/- only.
Flexibility in choosing the amount one wish to invest and the maturityperiod.
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BENIFITS OF SCHEME:-
Safety:SBI IS continues to deliver on its promise of safety and security over 200
years.
Liquidity Loan /overdraft facility:
One can avail a loan/overdraft against his deposit. SBI provides loan /
overdraft up to 90% of deposit amount at nominal cost. So one can continue to
earn interest in his deposit and still can meet his urgent financial requirements.
Premature Withdrawal
Interest to be charged on premature withdrawal of term deposits at 1.00% below
the rate applicable for the period deposit has remained with the Bank.
Transferability-
Transfer of Term Deposits between wide networks of branches without any charge.
Compounding / Flexible / Timely Payment of Interest - Under Special Term
Deposit Scheme, interest accrues in account and gets compounded quarterly.
Term Deposits are available at all SBI Branches Easy and convenient access of information at SBI Internet Banking.
Tax Implications:
Tax Deductible at Source, as per Income Tax Act
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Flexibility to convert Special Term Deposit to Term Deposit and vice versa
One can convert his special Term Deposit to a Term Deposit to receivemonthly/quarterly interest payments to match his financial requirements.
One can also convert his Term Deposit to a Special Term Deposit, whichprovides compounded rate of interest to multiply his money faster.
RECURRING DEPOSIT:-
Recurring deposit refers to a little investment by an investor to meet his financialgoals of future (Childrens education or marriage, buy a car etc.) Recurring deposit
provides the element of compulsion to save at high rates of interest, wide choice in
period of deposit.
Features:-
Flexibility in period of deposit with maturity ranging from 12 months to 120months.
Low minimum monthly deposit amount. One can start a Recurring Deposit with SBI for a monthly instalment of
Rs.100/- only.
Benefits:-
Including all the benefits of terms deposits there are some more benefits of
recurring benefits:-
Nomination Facility isavailable in this scheme
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one can save a monthly instalment of multiple of 10 every month One can monitor his deposit through SBI Internet Banking or through a
passbook issued to you.
LOANS:-
Type Amount
Min.
Max.
Rate of
interest
Security Eligibility
SBI SARAL
Personal loan
10,000
10,00,000
17.75 Nil A person having a good
profession and income
Education loan 4,00,000
4,00,000
7,50,000
4,00,000
7,50,000
12.25%
13.75%
Nil
Tangible
collateral
security
suitable
third party
Graduation courses
Post graduation
courses Professional
courses
Other courses approved
by
UGC/Government/AICT
E etc.
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12.25% guarantee
Car loan
Used vehicle
Up to 3 years
Above 3 years
New vehicle
Up to 3 years
1
2
Above 3 years
3-5years
5-7years
-
15,00,000
-
15,00,000
-
15,00,000
-
7,50,000
7,50,000
15,00,000
16.25%
16.50%
12.75%
12.50%
12.75%
13.00%
As per
bank's
extant
instructions
.
person having a income
>1,00,000
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-
15,00,000
-
15,00,000
Home loan
Up to 5 years
5 to15 years
30,00,000
30,00,000
75,00,000
30,00,000
75,00,000
0
10.50%
11.75%
11.75%
10.75%
12.00%
Availabilit
y of
sufficient,regular and
continuous
source of
income for
servicing
the loan
repayment.
Age
Equitable mortgage of the
property or
Other tangible security
of adequate value like
NSCs,
Life Insurance policies
etc.,
if the property cannot be
mortgaged
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Up to 15 years
30,00,000
30,00,000
75,00,000
30,00,000
75,00,000
0
30,00,000
30,00,000
75,00,000
30,00,000
75,00,000
12.00%
11.00%
12.25%
12.50%
18-60 years
Medi-Plus loan 50,000
1,00,000
50,000
2,00,000
50,000
1,00,000
14.50% As per
bank's
extant
instructions
.
Govt emp. From 10 years
self-employed
professional
employee/agent
(income>3lakhs)
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SCHEMES PROVDED BY ICICI:-
DEPOSITS CARDS ONLINE INVESTEMENT Loans
Personal loan Education loan
Car loan Home loan Property loan
Deposits:-
ICICI BANKoffers wide variety of deposit products to suit yourrequirements. Convenience of networked branches/ Atms and facility
of e-channels like internet andmobile banking.
Some of the ICICI deposit products are:-
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Saving account:-
A Savings Account for everyone with a host of
convenient features and banking channels to transact
through. So now you can bank at your convenience,
withut the stress of waiting in queues.
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Life Plus Senior Citizens Savings Account:-
This is a plan of ICICI bank for senior citizens,
who are of 60 years and above
Young Stars Savings Account:-
It's really important to help children
learn the value of finances and money
management at an early age. This is a
plan for children and their future. In a
tiny age Children learn how to manage
their personal finances.
Recurring Deposits:-
When people dont have so much
money to invest then according to this
scheme ICICI provides scheme to a
person to invest a little amount of
money.
CARDS:-
ICICI Bank offers a variety of cards to suit your different
transactional needs. One can use these cards for shopping, traveling or
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any other type of payments. These cards are of many types and used
for different purpose.
The different types of cards are:-
1. Credit cards: - Credit Cards give a smart way to shop, andoffer flexibility and convenience in managing finances. ICICI
credit cards provide a lot of exciting offers like low interest rate
and high cash and credit limit.
2. Travel cards: - Travel cards give a flexibility to travel aroundthe world. One can pay in currency of various countries fortraveling with the help of this card.
3. Debit Card: - this is a most common card. This can be used forshopping, billing of electricity and telephony.
ONLINE INVESTEMENT:-
Along with the cards and deposits ICICI provides online investments.
With the help of online investment one can manage his finances by
investing in following schemes of ICICI:-
ICICI Bank Tax Saving Bonds Government of India Bonds Investment in Mutual Funds Initial Public Offers by Corporate Investment in "Pure Gold"
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Foreign Exchange Services Senior Citizens Savings Scheme, 2004
Loans:-ICICI provides various loan schemes. It is a no. one home loan
and car loan provider. Along with this it provides personal and
education loan.
Type Amount
Min.
Max.
Rate of
interest
Security Eligibility
Personal loan
1,500000
Education
loan
4,00,000
4,00,000
7,50,000
For all
10-12%
Nil
Tangible
collateral
security
suitable
Graduation courses
Post graduation courses
Professional courses
Other courses approved by
UGC/Government/AICTE etc.
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4,00,000
7,50,000
third party
guarantee
Car loan -
15,00,000
11-
13%
As per
bank's
extant
instructions.
person having a income
>1,00,000
Home loan 0
75,00,000
11.5-
12.5%
Availability
of
sufficient,
regular and
continuous
source of
income for
servicing
the loan
repayment.
Equitable mortgage of the
property or
Other tangible security
of adequate value like NSCs,
Life Insurance policies etc.,
if the property cannot be
mortgaged
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ANALYSIS
ADVANTAGES OF ICICI OVER SBI:
ICICI is growing at a very fast rate with a total asset of Rs. 3,744.10 billion.
In the area of human relations, the two are taking divergent paths. SBI, which
had over 1 lacks employees, has reduced headcount through a voluntary
retirement scheme and is cautious about adding headcount.
ICICI Bank, on the other hand, is setting up regional hubs where its workforce
would be concentrated and plans to add 20,000 to its headcount every year. The
group plans to add between 75,000 and 1, 00,000 employees in the next few
years.
ICICI Bank is also set to outdo SBI is in its international book
- An area where it has been very aggressive.
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ADVANTAGES OF SBI OVER ICICI:
SBI is the largest and oldest bank of India. Its major stocks are held bygovernment of India. So this bank enjoys the trust of its Customers a lot.
SBI offers flexible tenures of loan repayment.
State bank of India has vast experience in the field of SME(Small and Medium Enterprises) Financing.
As it is the oldest name so it enjoys public trust a lot.SBI have four national level Apex Training Colleges and 54
Learning Centers spread all over the country the Bank is
Continuously engaged in skill enhancement of its employees.
Some of the training programs are attended by bankers from
banks in other countries.
SBI group, which has over 10,000 branches, is planning to add another3,000 branches.
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It is also set to become the largest issuer of debit cards and is the secondlargest credit card issuer.
Six reasons why we currently prefer SBI over ICICI
Reason #1 - Stronger CASA base
CASA franchise of 42% provides comfort on margin sustainability for SBI. Though CASA for ICICI will also improve from the current 27%, we
believe SBIs liability franchise will strengthen further with the opening of
~2,000 branches in FY09.
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Reason #2Asset-liability match of SBI is better
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SBI has a better asset-liability match, with 60% of liabilities of more than 1-year maturity, while ~71% of assets have more than 1-year maturity.
ICICI has 43% of its liabilities with more than 1-year maturity, while ~61%of assets have more than 1-year maturity.
Reason #3 - Proxy insurance plays onboth
Any upside on insurance reforms can be played through SBI as well.
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Cost ratios of SBI Life are better than ICICI Prudential Life due to its strongbancassurance model and better agency productivity.
Reason #4 - SBI has more diversified loan book
While asset quality risks persist for both banks, SBIs loan book is welldiversified across a variety ofsegments; ICICIs loan book is still skewed
towards retail.
According to our analysis, over the next 18 months the retail segment islikely to be more vulnerable than the corporate segment.
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Reason #5 - Market share gain in favor of SBI
SBI will continue to gain market share in both advances and deposits atICICIs expense due to the latters strategy of going slow.
Advances growth for SBI as at Q1FY09 was 28% versus 13% for ICICI. Deposit growth for SBI was at 25%, while for ICICI it was 2% as at
Q1FY09.
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Reason #6 - Return ratios for SBI are better
SBI is trading at 0.94x FY10E adjusted book, while ICICI is trading at1.0x FY10E adjusted book (assuming value of subsidiaries for SBI at
INR 301 and for ICICI at INR 283 on FY10E basis).
ROE for ICICI is expected to be in the range of 8-10% in FY09-10E,while that of SBI will be in the range of 14-16%.
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Key risks
SBIs low provisioning coverage (44%) will lead to higher provisioning costin FY10E, considering the aggressive balance sheet growth.
For ICICI, the expectation of bad asset quality is priced in and furthernegative surprises look unlikely.
Like any other PSU bank, the bulk of SBIs loan origination happens
through branches where underwriting standards are stricter, unlike the DSA
model that ICICI follows. Hence, while we expect NPAs to increase for SBI in
FY10E and FY11E, we do not expect SBI to go through a similar experience as
ICICI.
Also, revised loan waiver guidelines could keep SBIs Q2FY09 profitsmuted due to higher provision requirement.
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CONCLUSION:
The gap between SBI and the rest of the bank is so wide that SBI comes out as
number one on almost all counts. This includes assets, branch network, ATM
network, number of employees, and size of profits. The only place that ICICI Bank
has been able to upset the monolith has been in the area of market capitalization.
One reason why SBI has lagged in market cap despite its size has been its inability
to unlock value from its various businesses. However, there are signs that this is
changing and the bank is making attempts to realize the value of its investments in
the life insurance and asset management business.
SBI and ICICI are both Indias largest banks. Their growth means Indias growth.
And by this competition customers will be benefited and Indian economy will get a
boost.
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LEARNINGS
More flexible requirement given by this bank. Creating an efficient and effective organization. This live project topic gives opportunity to know about various loan schemes
provided by the bank.
The study shows all the important aspects of Bank loan schemes & how thisaffects to current financial trends.
It also describes the core features of borrowers as well as bankers forfinancing loan which is a complex process.
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LIMITATIONS
TIME CONSTRAINT I COLLECTED THE INFORMATION FROM THE MANAGER OF
SBI AND STAFF OF ICICI BY PHONE I COULD NOT MEET HIM
PERSONALLY
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BIBLIOGRAPHY
Primary data:-
Mr. Amit Yadav (Manager, Loan SBI) Mr. Manoj Kumar(Cashier, ICICI)
Secondary data:
Internet website :www.Google.com
www.Statebankofindia.com
www.Icicibank.com
http://www.google.com/http://www.google.com/http://www.statebankofindia.com/http://www.statebankofindia.com/http://www.icicibank.com/http://www.icicibank.com/http://www.icicibank.com/http://www.statebankofindia.com/http://www.google.com/Recommended