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7/28/2019 A Report on Market Structure of Bank Ofindia
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A REPORT ON MARKET
STRUCTURE OF BANK
OFINDIA
A REPORT ON
MARKET STRUCTURE OF
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BANK OF INDIA
SUBMITTED TO:
PROF. SNIGDHA TRIPARTY
PREPARED BY:
Salani sah 12202151
Reetika Nanda-12202150
Pallabi Naha-12202141
Rashmi Singh-12202148
Stitapragya Rout-12202165
Piyush Jain-12202142
Prabhudatta Behera-12202143
SEC-CKIIT SCHOOL OF MANAGEMENT,BHUBNESHWAR
SUBMITTED ON -15.11.2012
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DECLARATION
We hereby declare that the project report titled "A Report on market structure of Bank of India" is our own work and has been carried out under the guidance of Prof.Snigdha Tripathy, KIIT School of Management , Bhubaneswar .
All necessary steps has been taken to keep this report flawless and we sincerely regretany unintended discrepancies in this report .
Thank You,
Members of Group- ,
Roll no- 12202151, 12202150, 12202148, 12202143,12202143,12202141
Date : 15.11.2012
Place : Bhubaneswar
ACKNOWLEDGEMENT
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EXECUTIVE SUMMARY
This report proposes to study the market structure of banking institution.
The findings of our report is solely based on the primary data collection method i.e.Direct personal interview, in which we have interviewed Mr Manoranjan Das, ZonalMarketing manager of Bank of India.
The scope of our survey was limited to the Zonal branch of Bank of India located in
Nayapalli , and several other banks such as Axis bank ,IDBI,HDFC, SBI, Syndicate bank ,Bhubneswar.
The data was collected through personal interaction with Mr Manoranjan Das, ZonalMarketing Manager of Bank of India, who gladly responded to all the question asked
by us. His responses were thoroughly analysed and the main findings of the study isthat, the market structure of banking institution is that of a Monopolistic market .
We conclude from our study that Banking institution are considered to be
Monopolistic .
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INTRODUCTION
1.1. HISTORY
Banking in India originated in the last decades first banks were The General Bank of India, which started in 1786, and Bank of Hindustan, which started in 1770; both arenow defunct. The oldest bank in existence in India is the State Bank of India, whichoriginated in the Bank of Calcutta in June 1806, which almost immediately becamethe Bank of Bengal. This was one of the three presidency banks, the other two beingthe Bank of Bombay and the Bank of Madras, all three of which were establishedunder 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
1921 to form the Imperial Bank of India, which, upon India's independence, becamethe State Bank of India in 1955 .
Bank of India was founded on September 7, 1906 by a group of eminent businessmenfrom Mumbai. In July 1969 Bank of India was nationalized along with 13 other banks.
Beginning with a paid-up capital of Rs.50 lakh and 50 employees, the Bank has madea rapid growth over the years. It has evolved into a mighty institution with a strongnational presence and sizable international operations. In business volume, Bank of
India occupies a premier position among the nationalized banks.Merchants in Calcutta established the Union Bank in 1839, but it failed in 1840 as aconsequence of the economic crisis of 1848-49. The Allahabad Bank, established in1865 and still functioning today, is the oldest Joint Stock bank in India.(Joint Stock Bank: A company that issues stock and requires shareholders to be held liable for thecompany's debt) It was not the first though. That honor belongs to the Bank of Upper India, which was established in 1863, and which survived until 1913, when it failed,with some of its assets and liabilities being transferred to the Alliance Bank of Simla.
1.3. PURPOSE
This report attempts to laid down appropriate reasons for which the market structure of banking institution is said to be a monopolistic market-structure.
1.4. SCOPE
The primary data collection method used, in which we have interviewedMr Manoranjan Das, marketing Manager of Bank of India, Nayapalli (Zonal Office) to
http://en.wikipedia.org/w/index.php?title=Bank_of_Hindustan&action=edit&redlink=1http://en.wikipedia.org/wiki/State_Bank_of_Indiahttp://en.wikipedia.org/wiki/Bank_of_Calcuttahttp://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/Imperial_Bank_of_Indiahttp://en.wikipedia.org/wiki/State_Bank_of_Indiahttp://en.wikipedia.org/wiki/Calcuttahttp://en.wikipedia.org/wiki/Allahabad_Bankhttp://en.wikipedia.org/wiki/Alliance_Bank_of_Simlahttp://en.wikipedia.org/wiki/Alliance_Bank_of_Simlahttp://en.wikipedia.org/wiki/Allahabad_Bankhttp://en.wikipedia.org/wiki/Calcuttahttp://en.wikipedia.org/wiki/State_Bank_of_Indiahttp://en.wikipedia.org/wiki/Imperial_Bank_of_Indiahttp://en.wikipedia.org/wiki/Bank_of_Madrashttp://en.wikipedia.org/wiki/Bank_of_Bombayhttp://en.wikipedia.org/wiki/Bank_of_Bengalhttp://en.wikipedia.org/wiki/Bank_of_Calcuttahttp://en.wikipedia.org/wiki/State_Bank_of_Indiahttp://en.wikipedia.org/w/index.php?title=Bank_of_Hindustan&action=edit&redlink=17/28/2019 A Report on Market Structure of Bank Ofindia
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collect relevant data. We also collected the data of several other banks such as Axis bank, IDBI,SBI,HDFC, Syndicate bank ,etc. The data collected were analysed tostudy the market-structure of banking institution.
1.5. LIMITATION
Time constraint. The study was confined to Bhubaneswar area.
1.6 REPORT ORGANIZATION
The introduction includes background of the company, purpose of the study, source of the survey and limitations of the study. Further, the report convey about the aim andscope of the study. To fulfil the aim of the study, data was collected through Direct
personal interview method(primary Method). Then, the data has been analyzedthoroughly to arrive at a conclusion. Methods of analysis include data both primaryand secondary data analysis and conclusion is based on data analysis. The report thenmentions about the findings, conclusion and recommendations.
OBJECTIVE AND SCOPE OF STUDY
The objective of our study are as follows : To know the Market structure of banking institution. To analyse the characteristics of the market prevailing in relation to the banking
institution
Scope of studyThe area of our survey is limited to the Zonal head office of Bank Of India Nayapalli,Bhubaneswar , Odisha .We interviewed Mr Manoranjan Das , Zonal MarketingManager of Bank Of India, to get relevant data about the market structure of a bankinginstitution.
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REVIEW OF LITERATURE
In economics, the different ways to categorize the Market structure are:
1. numbers and size of buyers and sellers2. product differentation3. conditions to entry and exit
The market can be of different types:
1. Monopoly market
2. Perfect competitive market3. Monopolistic market4. Oligopoly market
MONOPOLY MARKET-
The characteristics of a monopoly market areas follows:
i. sole supplier of a productii. strong entry barrier
iii. seller is the price-maker iv. information symmetry does not exist
PERFECT COMPETETION-
The features of a perfectly competitive market are:
i. large numbers of buyers and sellersii. no entry barriers
iii. homogeneous productiv. price is determined by demand and supplyv. existence of information symmetry
MONOPOLISTIC MARKET-
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A market is said to be a monopolistic market, if there are:
i. relatively large number of buyers and sellersii. selling cost
iii. Heterogeneous productiv. free entry and exitv. independent decision about price and output
OLIGOPOLY MARKET-
The distinct feature of this market are as follows:
i. few sellersii. product can be homogeneous(pure oligopoly) or heterogeneous
product(differentiated oligopoly)iii. independent decision in relation to price and outputiv. barriers to entry
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METHODOLOGY AND RESEARCH DESIGN
Primary data sources were used to gather information about the Market Structure of banking institution. In our study the research instrument which was used was theDirect Personal Interview method. The survey area was confined to the zonal office of Bank Of India, Bhubaneswar .We interviewed Mr Manoranjan Das to collect relevantdata about the market structure of Bank Of India. We also collected the data of severalother banks such as Axis bank, IDBI,SBI,HDFC, Syndicate bank ,etc. Samplingmethod was used to conduct the study. The data collected were analysed Data socollected was then analysed using various statistical tools such as pie-chart , bar-graphs ,etc. The findings of our study is that , the banking institutions possess the
characteristics of a monopolistic market as there are:
relatively large numbers of buyers and sellers heterogeneous product selling cost and complete dissemination of market free entry and exit
Sampling plan :a. Sampling method: Stratified Random Sampling
b. Sample size: 5c. Sample unit: Banks in Bhubaneswar
Sources of data :a. Primary data : Direct personal interview
b. Secondary data: Internet , articles, journals
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DATA ANALYSIS AND INTERPRETATION
1. Percentage share of bank branches in Bhubaneswar
Interpretation:
24%
16%
14%
16%
30%
SHARE OF BRANCHES
BANK OF INDIA
AXIS BANK
IDBI
HDFC
SBI
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SBI has the highest percentage share at Bhubaneswar in terms of total number of branches with IDBI being the lowest.
2. Barrier to Entry in the market
Interpretation:
Overall barrier to entry in the market is high in case of Banking Sector. It is higher incase of PSUs in comparison with Private Sector Banks.
0% 5% 10% 15% 20% 25% 30% 35% 40%
HIGH
MEDIUM
LOW
25%
40%
35%
ENTRY BARRIER
ENTRY BARRIER
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3. Total advertisement expenses of different Banks
Interpretation:
The highest amount spent on advertisement is by SBI Bank followed by HDFC Bank,Axis Bank and Bank of India respectively.
0
2000000
4000000
6000000
8000000
10000000
12000000
14000000
16000000
18000000
20000000
BANK OFINDIA
SBI HDFC AXIS BANK
3000000
20000000
80000007000000
ADVERTISEMENT EXPENSES (Rs)
ADVERTISEMENT EXPENSES (Rs)
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CONCLUSION
RECOMMENDATIONS
BIBLIOGRAPHY