A Project Report on Hdfc Bank

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A PROJECT REPORT ON HDF BANK

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SYDENHAM COLLEGE OF COMMERCE AND ECONOMICS Page 1

A PROJECT REPORT ON

HDFC BANK IN LOANS DEPARTMENT

Bachelor of banking & insurance

Semester 5

Academic Year

2012-2013

Submitted By

VIJAY SINGH

Roll no: 52

Project Guide

Prof. VANEETA RANEY

Sydenham College of Commerce &

Economics

„B‟ Road, Churchgate, Mumbai - 400 020




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SYDENHAM COLLEGE OF COMMERCE

AND ECONOMICS

DECLARATION

I Mst. VIJAY SINGH the student of BACHELOR OF BANKING &

INSURANCE Semester V (2012-13) hereby declare that I have

completed the project on. The information submitted is true and original

to the best of my knowledge.

Signature of Student

Name of Student: VIJAY SINGH

Roll No.:-52




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“Experience Is the Best Teacher”

I would like to thank wholeheartedly, My Project Guide Prof VANEETA

RANEY . for helping me continuously and for giving me moral support for

preparing this project.

It would be rather unfair on my part for not thanking my college,SYDENHAM COLLEGE OF COMMERCE & ECONOMICS.

Principal Dr. (Mrs.) M.V Kalgalkar & Prof. Vaneeta Raney

for having shown their continuous faith in me.

I am very grateful and would like to thank my Family and other Professors

of my college for having helped me day in and day out, I am also thankful to my

Friends for their continuous help in making the project.

VIJAY SINGH




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CONTENTS

ORIGIN OF BANK

INDIAN MANAGEMENT SCENARIO

INTRODUTION OF BANKING

FUNCTION OF BANK

ROLE OF BANK IN ECONOMY

BANKS ESSENTIALLY PERFORM

TYPES OF BANKS

ROLE OF BANKING IN BUSINESS

ROLE OF BANKING IN MACRO ECONOMICS

LIST OF TOP 10 BANK IN INDIA

INTRODUCTION OF HDFC BANK

HISTORY OF HDFC

RETAIL BANKING SERVICES

LOAN IN HDFC BANK

CONCUSION

RECOMMENDATIONS

BIBLIO




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ORIGIN OF BANKING:

The word 'Bank' is said to have been derived from the words ‗Bancus‘ or ‗Banque‘

or Bank. This history of banking is traced to as early as 2000 B.C. The priests in

Greece used to keep money and valuables of the people in temples. These priests

thus acted as financial agents. The origin of banking is also traced to early

goldsmiths. They used to keep strong safes for storing the money and valuables of

the people. The persons who had surplus money found it safe and convenient of

deposit their valuables with them. The first stage in the development of modern

banking, thus, was the accepting of deposits of cash from those persons who had

surplus money with them.

The goldsmiths used to issue receipts for the money deposited with them. These

receipts began to pass for the settlement of transactions as people had confidence

in the integrity and solvency of goldsmiths. When it was found that these receipts

became fully acceptable for the payment of debts; then the receipts were drawn in

such a way that it entitled any holder to claim the specified amount of money from

goldsmiths. These receipts were the earlier bank notes. The second stage in the

development of banking thus was the issue of bank notes.

The goldsmiths soon discovered that all the people who had deposited money with

them do not come to withdraw their funds in cash. They found that only a few persons presented the receipts for encashment during a given period of time. They

also found that most of the money deposited with them was lying idle. At the same

time; they found that they were being constantly requested for loan on good

security. They thought it profitable to lend at least some of the money deposited




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with them to the needy persons. This proved quite a profitable business for the_

goldsmiths. They instead of charging safe keeping charges from the depositors

began to give them interest on the money deposited with them. This was the third

stage in the development of banking.

DEFINITION OF A BANK:

The term 'bank' is being used for a long time, yet it has no precise definition. The

basic reason is that the commercial banks perform not just one but many types of

functions. The term bank has been defined differently by different authors. Some

are as follows:

According to Crowther:

"Bank is a dealer in debts — his own and of other people."

According to G.W. Gilbert,

"A banker is a dealer in capital or more properly a dealer in money.

He is an intermediate party between the borrower and the lender.

He borrows from one party and lends to another."

According to Banking Companies Ordinance 1962:

"Banker means person transacting the business of accepting for the purpose of

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

or otherwise and withdraw able by cheque, draft, and order or otherwise and




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includes any Post Office Savings Bank."

INDIAN MANAGEMENT SCENARIO

Current Indian Banking System Scenario

Two points for what was happening in banking and investment sector in the last 5

years.

1. Increased consumerism: If we look at the consumption pattern in last 5 years,

people were moving from being savers to consumers, i.e., more emphasis on

benefits gained today rather than gains received through savings in future, this

changing attitude is one of the reasons for higher growth in lending compared

to deposits.

2.

Alternatives and risks: People were looking for more alternatives like mutualfunds, different insurance schemes, stock market, etc. People were moving to

these products with higher return expectations. These instruments also have

higher risk and increased income level people who deposit high amounts of

money into banks were ready to take these high-risk alternatives.

But now the situation will be slightly better for banking system in India because

investors are losing a lot of wealth in stock markets and mutual funds. People will

realize the importance of safer investment vehicle and will start diversifying their

portfolio with increased exposure to safer instruments like bank deposits.




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The banks in India generate their funds from two

types of sources:

Long-Term Sources:

1. Tier one and Tier two Capital in the form of equity/subordinate

debts/debentures/preference shares.

2. Internal accrual generated out of profits.

3. Long-term fixed deposits generated from public and corporate clients,

financial institutions, and mutual funds, etc.

4. Long-term borrowings from financial institutions like NABARD/SIDBI.

Short-Term Sources:1. Call money market, i.e., funds generated among interbanking transactions

where there is online trading of money between bankers.

2. Fixed deposits generated from public and corporate clients, FIs, and MFs, etc.

3. Market-linked borrowings from RBI.

4. Sale of liquid certificate deposits in the open market.

5. Borrowing from RBI under Repo (Repurchase option).

6. Short and medium-term fixed deposits generated from public and corporate

clients, mutual funds, and financial institutions, etc.




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7. Floating in current and saving accounts.

8. Short-term borrowings from FIs by way of rated papers placed, etc.

9. DEFINITION OF A BANK:

The term 'bank' is being used for a long time, yet it has no precise definition.

The basic reason is that the commercial banks perform not just one but many

types of functions. The term bank has been defined differently by different

authors. Some are as follows

According to Crowther:

"Bank is a dealer in debts — his own and of other people."

According to G.W. Gilbert,

"A banker is a dealer in capital or more properly a dealer in money.

He is an intermediate party between the borrower and the lender.

He borrows from one party and lends to another."

According to Banking Companies Ordinance 1962:

"Banker means person transacting the business of accepting for the purpose of

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

or otherwise and withdraw able by cheque, draft, and order or otherwise and

includes any Post Office Savings Bank."




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INTRODUCTION OF BANKING

Banks over the years, have become a significant aspect of an economy. With the

on going financial depression, the position of banks have become all the more

important in the course of working of the money market and hence the economy of

a nation. The banking sector forming a portion of the financial sector primarily

works as a financial intermediary generating money supply. From the

different macro economic models, banks have been found to be a part of the supply

side of the economy. However, over time banks have transformed from merely

money enervating organizations to a multi tasking entity. In this paper, we shall

deal with the role of banks in the context of the world economy as well as the

Indian economy. The first section will illustrate the functions of a bank along with

its classification. In the second section, we shall discuss the role of a banks as amajor component of the service sector rendering to the economy as a whole. In the

third section, we would like to empirically validate our hypothesis with

comprehensive data analysis.




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Motivation

The recession in the US market and the global meltdown termed as

Global recession have engulfed complete world economy with a varying degree of

recessional impact. World over the impact has diversified and its impact can

be observed from the very fact of falling Stock market, recession in jobs

availability and companies following downsizing in the existing available staff and

cutting down of the perks and salary corrections. Various steps taken by RBI to

curb

The present recession in the economy and counter act the prevailing situation. The

sudden drying-up of capital inflows from the FDI which were invested in Indian

stock markets for greater returns visualizing the Potential Higher Returns flying

back discontinuing to challenge liquidity management. At the heart of the currentliquidity tightening is the balance of payments deficit, and this NRI deposit move

should help in some small way. To curb the liquidity crises the RBI will continue

to initiate liquidity measures as long as the current unusually tight domestic

liquidity environment prevails. The current step to curb these being lowering of

interest rates and reduction of PLR. The BOP- Balance of Payment deficit

at a time when domestic credit demand is very high is resulting in a vicious loop of

reduce access to liquidity, slowing growth, and increased risk-aversion in

the financial system. In present situation down fall in one sector one day leads to a

negative impact on the other sector thus all together everyone feel the impact of the

Financial crises with the result of the current recession which started in US and




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slowly and gradually due to linked global world have impacted everyone. Solution

for the problem still remain at the top of the mind of every one, still everyone

facing the impact of recession but how long is the major question which is of great

importance.

Hypothesis

In this research paper, I am trying to give an overview of the whole banking sector

in India and the kind of financial functions they perform which help in the growth

of the economic growth and progress of the country. I have tried to look for

relationship if any between GDP and the following: Total advances/Total deposits,

Credit Deposit Ratio, Lending interest rates, and the sectors in India which got

more advances from the banks over the last 3 years.




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What is a Bank?

While the question may seem elementary, the answer can be quite complex.

Understanding what banking is all about will help the paper to illustrate the role of

banks better. A bank is a financial institution where an individual can

deposit money. Banks provide a system for easily transferring money from one

person or business to another. Using banks and the many services they offer saves

an incredible amount of time, and ensures that the funds of micro as well as

macroeconomic agents "pass hands" in a legal and structured manner. There are

also other types of financial institutions that operate just like banks.

Functions of a Bank

Functioning of a Bank is among the more complicated of corporate operations.

Since Banking involves dealing directly with money, governments in mostcountries regulate this sector rather stringently. In India, the regulation traditionally

has been very strict and in the opinion of certain quarters, responsible for the

present condition of banks, whereas are of a very high order. The process of

financial reforms, which started in 1991, has cleared the cobwebs somewhat but a

lot remains to be done. The multiplicity of policy and regulations that a Bank has

to work with, makes its operations even more complicated, sometimes bordering

on illogical. This section attempts to give an overview of the functions in as simple

manner as possible. Banking Regulation Act of India, 1949 defines Banking as

"accepting, for the purpose of lending or investment of deposits of money from the

public, repayable on demand or otherwise and withdraw able by cherubs, draft,




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order or otherwise". Deriving from this definition and viewed solely from the

point of view of the customers,

ROLE OF BANKS IN ECONOMY

Money lending in one form or the other has evolved along with the history of the

mankind. Even in the ancient times there are references to the moneylenders.

Shakespeare also referred to ‗Shylocks‘ who made unreasonable demands in case

the loans were not repaid in time along with interest. Indian history is also replete

with the instances referring to indigenous money lenders, Sahukars and Seminars

involved in the business of money lending by mortgaging the landed property of

the borrowers.

Towards the beginning of the twentieth century, with the onset of modern industry

in the country, the need for government regulated banking system was felt. The

British government began to pay attention towards the need for an organized

banking sector in the country and Reserve Bank of India was set up to regulate the

formal banking sector in the country. But the growth of modern banking remained

slow mainly due to lack of surplus capital in the Indian economic system at that

point of time. Modern banking institutions came up only in big cities and industrial

centres. The rural areas, representing vast majority of Indian society, remained

dependent on the indigenous money lenders for their credit needs.

Independence of the country heralded a new era in the growth of modern banking.

Many new commercial banks came up in various parts of the country. As the

modern banking network grew, the government began to realize that the banking




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sector was catering only to the needs of the well-to-do and the capitalists. The

interests of the poorer sections as well as those of the common man were being

ignored.

In 1969, Indian government took a historic decision to nationalize 14 biggest

private commercial banks. A few more were nationalized after a couple of years.

This resulted in transferring the ownership of these banks to the State and the

Reserve Bank of India could then issue directions to these banks to fund the

national programmers, the rural sector, the plan priorities and the priority sector at

differential rate of interest. This resulted in providing fillip the banking facilities

to the rural areas, to the under-privileged and the downtrodden. It also resulted in

financial inclusion of all categories of people in almost all the regions of the

country.

However, after almost two decades of bank nationalization some new issues

became contextual. The service standards of the public sector banks began todecline. Their profitability came down and the efficiency of the staff became

suspect. Non-performing assets of these banks began to rise. The wheel of time had

turned a full circle by early nineties and the government after the introduction of

structural and economic reforms in the financial sector, allowed the setting up of

new banks in the private sector.

The new generation private banks have now established themselves in the system

and have set new standards of service and efficiency. These banks have also given

tough but healthy competition to the public sector banks.




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Modern Day Role

Banking system and the Financial Institutions play very significant role in the

economy. First and foremost is in the form of catering to the need of credit for all

the sections of society. The modern economies in the world have developed

primarily by making best use of the credit availability in their systems. An efficient

banking system must cater to the needs of high end investors by making available

high amounts of capital for big projects in the industrial, infrastructure and service

sectors. At the same time, the medium and small ventures must also have credit

available to them for new investment and expansion of the existing units. Rural

sector in a country like India can grow only if cheaper credit is available to the

farmers for their short and medium term needs.

Credit availability for infrastructure sector is also extremely important. The success

of any financial system can be fathomed by finding out the availability of reliable

and adequate credit for infrastructure projects. Fortunately, during the past about

one decade there has been increased participation of the private sector in

infrastructure projects.

The banks and the financial institutions also cater to another important need of the

society i.e. mopping up small savings at reasonable rates with several options. The

common man has the option to park his savings under a few alternatives, including




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the small savings schemes introduced by the government from time to time and in

bank deposits in the for

m of savings accounts, recurring deposits and time deposits. Another option is to

invest in the stocks or mutual funds.

In addition to the above traditional role, the banks and the financial institutions

also perform certain new-age functions which could not be thought of a couple of

decades ago. The facility of internet banking enables a consumer to access and

operate his bank account without actually visiting the bank premises. The facility

of ATMs and the credit/debit cards has revolutionised the choices available with

the customers. The banks also serve as alternative gateways for making payments

on account of income tax and online payment of various bills like the telephone,

electricity and tax. The bank customers can also invest their funds in various stocks

or mutual funds straight from their bank accounts. In the modern day economy,

where people have no time to make these payments by standing in queue, the

service provided by the banks is commendable.

While the commercial banks cater to the banking needs of the people in the cities

and towns, there is another category of banks that looks after the credit and

banking needs of the people living in the rural areas, particularly the farmers.

Regional Rural Banks (RRBs) have been sponsored by many commercial banks in

several States. These banks, along with the cooperative banks, take care of the

farmer-specific needs of credit and other banking facilities.




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Future

Till a few years ago, the government largely patro-nized the small savings schemes

in which not only the interest rates were higher, but the income tax rebates and

incentives were also in plenty. The bank deposits, on the other hand, did not entail

such benefits. As a result, the small savings were the first choice of the investors.

But for the last few years the trend has been reversed. The small savings, the bank

deposits and the mutual funds have been brought at par for the purpose of

incentives under the income tax. Moreover, the interest rates in the small savings

schemes are no longer higher than those offered by the banks.

Banks today are free to determine their interest rates within the given limits

prescribed by the RBI. It is now easier for the banks to open new branches. But the

banking sector reforms are still not complete. A lot more is required to be done to

revamp the public sector banks. Mergers and amalgamation is the next measure on

the agenda of the government. The government is also preparing to disinvest some

of its equity from the PSU banks. The option of allowing foreign direct investment

beyond 50 per cent in the Indian banking sector has also been under consideration.

Banks and financial intuitions have played major role in the economic

development of the country and most of the credit- related schemes of the

government to uplift the poorer and the under-privileged sections have been




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implemented through the banking sector. The role of the banks has been important,

but it is going to be even more important in the future.

BANKS ESSENTIALLY PERFORM THE FOLLOWING

FUNCTIONS

1.Accepting Deposits from public/others (Deposits)

2.Lending money to public (Loans)

3.Transferring money from one place to another (Remittances)

4.Credit Creation

5.Acting as trustees

6.Keeping valuables in safe custody

7.Investment Decisions and analysis

8.Government business

9.Other types of lending and transactions.

In addition to providing a safe custodian of money, banks also loan money to

businesses andconsumers. A large portion of a bank's business is lending. How do

banks get the money they loan? The money comes from depositors




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Who intend to save a portion of their wealth? Banks acting as intermediaries,

use these deposits as loans to prospective borrowers. The objective of commercial

banks like any other organization is profit maximization. This profit generally

originates from the interest differential between borrowers and lenders. In the

present-day, however, the banking operation has extended much beyond simple

lending exercise. So there are other different channels of profit ensuing from other

investment programmers as well. However, it should be mentioned in this context

that the entire deposit held by a bank cannot be given as loans as the Central

Bank retains a portion of this money in the form of cash-reserve for unforeseen

circumstances. Banks

Create money

In the economy by making loans. The amount of money that banks can lend is

directly affected by the reserve requirement set by the Federal Reserve. The

reserve requirement is currently 3 percent to 10 percent of a bank's total deposits.

This amount can be held either in cash on hand or in the bank's reserve account

with the Fed. To see how this affects the economy, think about it like this. When a

bank gets a deposit of $100, assuming a reserve requirement of 10 percent, the

bank can then lend out $90. That $90 goes back into the economy, purchasing

goods or services, and usually ends up deposited in another bank. That bank can

then lend out $81 of that $90 deposit, and that $81 goes into the economy to

purchase goods or services and ultimately is deposited into another bank that

proceeds to lend out a percentage of it. In this way, money grows and flows

throughout the community in a much greater amount than physically exists. That

$100 makes a much larger ripple in the economy than you may realize!




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Other Services Offered by Banks

Credit Cards

Personal Loans

Home and Car Loans

Mutual Funds

Business Loans

Safe Deposit Boxes

Debit Cards




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Trust Services

Signature Guarantees and many other investment services.

Types of Banks

Central Bank:

A central bank, reserve bank, or monetary authority is the entity responsible forth

monetary policy of a country or of a group of member states. Its primary

responsibility is to maintain the stability of the national currency and money

supply, but more active duties include controlling subsidized-loan interest rates,

and acting as a lender of last resort to the banking sector during times of financial

crisis (private banks often being integral to the national financial system). It may

also have supervisory powers, to ensure that banks and other financial institutions

do not behave recklessly or fraudulently.

Commercial Banks

: A commercial Bank performs all kinds of banking functions such as accepting

deposits, advancing loans, credit creation & agency functions. They generally

advance short term loans to their customers; in some cases they may give medium

term loans also

Industrial Banks

: Ordinarily, the industrial banks perform three main functions: Firstly, Acceptance

of Long term deposits: Since the industrial bank give long term loans, they cannot

accept short term deposits from the public. Secondly, Meeting the credit




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requirements of companies: Firstly the industries require purchasing land to

erect buildings and purchase heavy machinery. Secondly the industries require

short term loans to buy raw materials & to make payment of wages to workers .

Thirdly it does some Other Functions - The industrial banks tender advice to big

industrial firms regarding the sale & purchase of shares & debentures

Agricultural Banks

: As the commercial & the industrial Banks are not in a position to meet thecredit

requirements of agriculture , there arises the need for setting up special types of

banks to finance agriculture. Firstly, the farmers require short term loans to buy

seeds, fertilizers, ploughsand other inputs . Secondly, the farmers require long term

loans to purchase land, to effectpermanent improvements on the land to buy

equipment & to provide for irrigation works .

Foreign Exchange Banks

: Their main functions is to make international payments through thepurchase and

sale of exchange bills . As is well known , the exporters of a country prefer

toreceive the payment for their exports in their own currency . Hence their arises

the problem of converting the currency of one country into the currency of another

. The foreign exchange bankstry to solve this problem . These banks specialize in

financing foreign trade .

Indigenous Banks

: According to the Indian Enquiry Committee, ―Indigenous banker is a person or a

firm which accepts deposits, transacts business in hundies and advances loans etc‖.






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Starting with your next submission write a one- page situation assessment

describing what he will be seeing in your financial statements. Briefly, tell him

what is going on that causes the numbers to be what they are. Tell him what you

are doing and what you genuinely expect to see in your next report. You might

even consider calculating some of the ratios for him that he uses to monitor your

company. (If you do not know what these are, ask him). If you have a problem that

you do not know how to handle, seek qualified help and tell him you are doing so.

He may even suggest a trusted resource.

If there are problems evident in your statement are up front about what you are

doing. Do not minimize the significance of items that you do not yet have under

control. This should serve as the basis for your discussion of the period.

Does the same thing next reporting period except now you add information relative

to how good, or poor your projections were. If you were close, good, if you were

not, you have to discuss why you were off and what you are doing to get better.

You might think this is a chance to look bad. Maybe so, but if you cannot project

for your banker, how good are the projections you are using for yourself? If you

are not making projections, it is difficult to understand how it is that you think you

are in control of your business.




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ROLE OF BANKING IN MACRO ECONOMICS

. ROLE OF COMMERCIAL BANKS IN THE ECONOMIC

DEVELOPMENT OF A COUNTRY

2. Role of Commercial Banks in the Economic Development of a Country

Commercial banks play an important and active role in the economic

development of a country. If the banking system in a country is effective,

efficient and disciplined it brings about a rapid growth in the various sectors

of the economy. The following is the significance of commercial banks in

the economic development of a country.

3. Role of Commercial Banks in the Economic Development of a Country 1.

Banks promote capital formation 2. Investment in new enterprises 3.

Promotion of trade and industry 4. Development of agriculture 5. Balanced

development of different regions 6. Influencing economy activity 7.

Implementation of Monetary policy 8. Monetization of the economy 9.

Export promotion cells




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LIST OF TOP 10 BANKS OF INDIA

State Bank of India

ICICI Bank

AXIS Bank

HDFC Bank

Bank of India

Bank of Baroda

Punjab Bank of India (PNB)

Citibank

Canada Bank

Union Bank of India




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HDFC Bank was amongst the first to receive an ‗in- principle‘ approval from the

Reserve Bank of India (RBI) to set up a bank in the private sector from Housing

Development Finance Corporation Limited (HDFC), in 1994 during the period of

liberalization of the banking sector in India. HDFC India was incorporated in

August 1994 in the name of ‗HDFC Bank Limited‘. HDFC India commenced

operations as a Scheduled Commercial Bank in January 1995.

HDFC India deals in varieties of products like home loan, standard life insurance,

mutual fund, securities, credit cards, etc. HDFC has branch offices in all major

cities in India like Calcutta, Chennai, Delhi, Bangalore, Hyderabad, Ahmadabad

apart from HDFC Mumbai.

Headquarter HDFC Bank India :

‗Trade Star‘, 2nd floor, ‗A‘ Wing,

Junction of Kondivita and M.V. Road,

Andheri-Kurla Road,

Andheri (East), Mumbai – 400 059.

Tel: (Board) 2822 0055 / 55516666 (Fax) : 2822 9998 / 2822 2414

Network: More than 468 branches over 212 cities across the country

ATMs: The ATMs of HDFC India can be accessed by all domestic and

international Visa/Master Card, Visa Electron/Maestro, Plus/Cirrus and American

Express Credit/Charge cardholders.




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Authorized capital: Rs. 450 crore

Paid-up capital: Rs. 282 crore

Equity: Holds 24.2%

Listing: HDFC India has been listed on the Stock Exchange, Mumbai and the

National Stock Exchange. The bank‘s American Depository Shares are listed on

the New York Stock Exchange (NYSE) under the symbol ―HDB‖.

HDFC Product Range

HDFC Bank India provides the following range of products:

* Savings Account

* HDFC Bank Preferred

* Sweep-In Account

* Super Saver Account

* HDFC Bank Plus

* Demat Account

* HDFC Mutual Fund

* HDFC Standard Life Insurance

HDFC India innovative services

* HDFC Phone Banking

* HDFC ATM

* HDFC Inter-city/Inter-branch Banking

* HDFC Net Banking

* HDFC International Debit Card

* HDFC Mobile Banking

* HDFC Bill Pay




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HDFC Bank Loans

* HDFC Personal Loan

* HDFC New Car Loan and Used Car Loan* HDFC Loan against Shares

* HDFC Two Wheeler & Consumer Loan

* HDFC Home Loan

HISTORY OF HDFC BANK:

HDFC Bank was incorporated in 1994 by Housing Development Finance

Corporation Limited (HDFC), India's largest housing finance company. It was

among the first companies to receive an 'in principle' approval from the Reserve

Bank of India (RBI) to set up a bank in the private sector. The Bank started

operations as a scheduled commercial bank in January 1995 under the RBI's

liberalization policies.

Times Bank Limited (owned by Bennett, Coleman & Co. / Times Group) was

merged with HDFC Bank Ltd., in 2000. This was the first merger of two private

banks in India. Shareholders of Times Bank received 1 share of HDFC Bank for

every 5.75 shares of Times Bank.

In 2008 HDFC Bank acquired Centurion Bank of Punjab taking its total branches

to more than 1,000. The amalgamated bank emerged with a base of about Rs.

1,22,000 crore and net advances of about Rs.89,000 crore. The balance sheet size

of the combined entity is more than Rs. 1,63,000 crore.

http://en.wikipedia.org/wiki/Reserve_Bank_of_India


http://en.wikipedia.org/w/index.php?title=Times_Bank&action=edit&redlink=1

http://en.wikipedia.org/wiki/Centurion_Bank_of_Punjab

http://en.wikipedia.org/wiki/Centurion_Bank_of_Punjab

http://en.wikipedia.org/w/index.php?title=Times_Bank&action=edit&redlink=1






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2.6 ORGANIZATION STRUCTURE AND ORGANIZAION

CHART

HDFC Bank

The Composition of the Board of Directors of the Bank is governed by the

Companies Act, 1956, the Banking Regulation Act, 1949 and the listing

requirements of the Indian Stock Exchanges where the securities issued by the

Bank are listed. The Board has a strength of 9 Directors as on March 31, 2007. All

Directors other than Mr Aditya Puri are non-executive directors. The Bank has four

independent directors and five non-independent directors. The Board consists of

JAGDISH COPOOR(CHAIRMAN/CHAIR PERSON)

KEKI MISTRY (DIRECTOR)

VINEET JAIN(DIRECTOR)

RENU KARNAT(DIRECTOR)

ARVIND PANDE(DIRECTOR)

ASHIM SAMANTA(DIRECTOR)

CM VASUDEV(DIRECTOR)

GAUTAM DIRAN(DIRECTOR)

PANDIT PALANDE(DIRECTOR)

ADITYA PURI (MANAGING DIRECTOR)

HARISH ENGINEER (EXECUTIVE DIRECTOR)PARESH SUKTHANKAR(EXECUTIVE

DIRECTOR()




T.Y.BBI


eminent persons with considerable professional expertise and experience in

banking, finance, agriculture, small scale industries and other related fields. None

of the Directors on the Board is a member of more than 10 Committees and

Chairman of more than 5 Committees across all the companies in which he/she is a

Director. All the Directors have made necessary disclosures regarding Committee

positions occupied by them in other companies.

Mr. Jagdish Capoor, Mr. Aditya Puri, Mr. Keki Mistry, Mrs. Renu Karnad and

Mr. Vineet Jain are non-independent Directors on the Board.

Mr. Arvind Pande, Mr. Ashim Samanta, Mr. Gautam Divan and Mr. C. M.

Vasudev are independent directors on the Board.

Mr. Keki Mistry and Mrs. Renu Karnad represent HDFC Limited on the Board

of the Bank.

Mr. Vineet Jain is nominated by the Bennett, Coleman Group on the Board of

the Bank.

The Bank has not entered into any materially significant transactions during the

year, which could have a potential conflict of interest between the Bank

and its promoters, directors, management and/or their relatives, etc. other

than the transactions entered into in the normal course of business. The

Senior Management have made disclosures to the Board confirming that

there are no material, financial and/or commercial transactions between

them and the Bank which could have potential conflict of interest with the

Bank at larg




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BUSINESS FOCUS :

HDFC Bank deals with three key business segments. - Wholesale Banking

Services, Retail Banking Services, Treasury. It has entered the banking consortia

of over 50 corporate for providing working capital finance, trade services,

corporate finance, and merchant banking. It is also providing sophisticated product

structures in areas of foreign exchange and derivatives, money markets and debt

trading and equity research.

Wholesale banking services :

Blue-chip manufacturing companies in the Indian corp to small & mid-sized

corporate and agri-based businesses. For these customers, the Bank provides a

wide range of commercial and transactional banking services, including working

capital finance, trade services, transactional services, cash management, etc. The

bank is also a leading provider offor it‘s to corporate customers, mutual funds,

stock exchange members and banks.

Retail banking services:

HDFC Bank was the first bank in India to launch an International Debit Card inassociation with VISA (VISA Electron) and issues the MasterCard Maestro debit

card as well. The Bank launched its credit card business in late 2001. By March

2009, the bank had a total card base (debit and credit cards) of over 13 million. The

http://en.wikipedia.org/wiki/Working_capital

http://en.wikipedia.org/wiki/Corporate_finance

http://en.wikipedia.org/wiki/Merchant_banking

http://en.wikipedia.org/wiki/Merchant_banking

http://en.wikipedia.org/wiki/Corporate_finance

http://en.wikipedia.org/wiki/Working_capital




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Bank is also one of the leading players in the ―merchant acquiring‖ business with

over 70,000 Point-of-sale (POS) terminals for debit / credit cards acceptance at

merchant establishments. The Bank is positioned in various net based B2C

opportunities including a wide range of internet banking services for Fixed

Deposits, Loans, Bill Payments, etc.

Treasury:

Within this business, the bank has three main product areas - Foreign Exchange

and Derivatives, Local Currency Money Market & Debt Securities, and Equities.

These services are provided through the bank's Treasury team. To comply with

statutory reserve requirements, the bank is required to hold 25% of its deposits in

government securities. The Treasury business is responsible for managing the

returns and market risk on this investment portfolio.

Distribution network:

HDFC Bank is headquartered in Mumbai. The Bank has an nationwide network of

2000 branches spread in 996 towns and cities across India. All branches are linked

on an online real-time basis. Customers in over 500 locations are also serviced

through Telephone Banking. The Bank has a presence in all major industrial and

commercial centres across the country. Being a clearing/settlement bank to various

leading stock exchanges, the Bank has branches in the centres where the NSE/BSE

have a member base.

The Bank also has 5,998 networked ATMs across these towns and cities.

Moreover, HDFC Bank's ATM network can be accessed by all domestic and




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international Visa/MasterCard, Visa Electron/Maestro, Plus/Cirrus and American

Express Credit/Charge cardholders.

What Is Loan:

A loan is a type of debt. Like all debt instruments, a loan entails the redistribution

of financial assets over time, between the lender and the borrower .

In a loan, the borrower initially receives or borrows an amount of money, called

the principal , from the lender, and is obligated to pay back or repay an equal

amount of money to the lender at a later time. Typically, the money is paid back in

regular installments, or partial repayments; in an annuity, each installment is the

same amount.

The loan is generally provided at a cost, referred to as interest on the debt, which

provides an incentive for the lender to engage in the loan. In a legal loan, each of

these obligations and restrictions is enforced by contract, which can also place the

borrower under additional restrictions known as loan covenants. Although this

article focuses on monetary loans, in practice any material object might be lent.

Acting as a provider of loans is one of the principal tasks for financial institutions.

For other institutions, issuing of debt contracts such as bonds is a typical source of

funding.

100% Loan Plan with Fixed Deposit Lien: This allows you to take a loan

against your deposit at HDFC Bank.

http://en.wikipedia.org/wiki/Debt



http://en.wikipedia.org/wiki/Asset



http://en.wiktionary.org/wiki/lender



http://en.wiktionary.org/wiki/borrower



http://en.wikipedia.org/wiki/Money



http://en.wikipedia.org/wiki/Annuity_(finance_theory)



http://en.wikipedia.org/wiki/Interest






http://en.wikipedia.org/wiki/Contract



http://en.wikipedia.org/wiki/Loan_covenant



http://en.wikipedia.org/wiki/Financial_institution






http://en.wikipedia.org/wiki/Bond_(finance)



















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You can get a loan for 100% of the invoice value amount with the required

margin placed as a fixed deposit in HDFC Bank . Lein is marked on the specified Deposit .Installments can be paid separately

or out of the deposit (if the deposit is large enough).

NRI Loans: NRIs can avail of new car loans from HDFC Bank for the use of the

vehicles by their relatives in India. Additional documents required are as follows:

Contract copy and salary slip of NRI.

Endorsement on passport for last 3 years.

Proof of ownership of property.

Post-dated cheques must be from the resident account of the borrower.

Past re-payment history :

Plan for customers who have taken a car loan and have repaid that loanfully without any outstanding.

Credit approval on the basis of past re-payment record.

Approval Plan: If you have an HDFC Bank Preferred Account or a

Corporate Salary Account with HDFC Bank for more than six months, you

can get fast approvals on your loans with minimal documentation.

Eligibility & Documentation :

Salaried Individual :




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Eligibility :

Minimum age of Applicant: 21 years.

Maximum age of Applicant at loan maturity: 58 years.

Minimum employment: 1 year in current employment and minimum 2 years

of employment.

Minimum Annual Income: Rs 100000 net annual income.

Telephone: Must at residence

Documents required:

Proof of Identity:- Passport copy, PAN Card, Voters Id car, driving

licence(Laminated, Recent, Legible).

Income Proof:- Latest salary slip with form 16.

Address Proof:- Ration card/Driving license/Voters card/passport

copy/telephone bill/ electricity bill/Life insurance policy PAN Card.

Bank statement – Not Mandatory.

Self Employed:

Eligibility Criteria:

Minimum age of Applicant: 21 years.

Maximum age of Applicant at loan maturity: 65 years.

Minimum employment: At least 3 years in business.




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Minimum Annual Income: Net profit Rs. 60000 p.a for standard cars and

Rs.100000 p.a. for mid-sized and premium cars.

Telephone: Must at residence.

Documents required:

Proof of Identity:- Passport copy, PAN Card, Voters Id car, driving licence(

Laminated, Recent, Legible)

Income Proof:- Latest ITR.

Address Proof: - Ration card/Driving licence/Voters card/passport

copy/telephone bill/ electricity bill/Life insurance policy PAN Card.

Bank Statement:- Waived for small cars, for mid - sized and premium cars if

income Is greater than Rs. 1.5 lacs then bank statement requirement can be

waived.

Partnership Firms :


Minimum Income: Net profit Rs. 60000 p.a for standard cars and

Rs.100000 p.a. for mid-sized and premium cars.

Minimum turnover: Turnover Rs. 4.5 lacs.




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Telephone: One phone at least at business and at residence of the loan

executing partner.

Documents required:

Proof of Identity:- NA.

Income Proof:- Audited balance sheet, Profit & Loss Account for latest two

years and the latest 2 years IT returns of the company.

Address Proof:- Telephone Bill/Electricity Bill/Shop & Establishment Act

certificate/SSI registered certificate/Sales Tax certificate.

Bank Statement:- Waived for small cars, for mid - sized and premium cars if

income Is greater than Rs 1.5 lacs then bank statement requirement can be

waived.

Private Limited Company :


Minimum Income: Net profit Rs. 60000 p.a for standard cars and Rs.100000

p a for mid-sized and premium cars.

Minimum turnover: Turnover Rs 4.5 lacs.

Telephone: One phone at least at business premises.




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Documents required:



years and the latest 2 years IT returns of the company.


certificate/SSI registered certificate/Sales Tax certificate.

Bank Statement:- NA

Public Limited Company :


Minimum Income: Net profit Rs. 60000 p.a for standard cars and Rs.100000

p a for mid-sized and premium cars.

Minimum turnover: Turnover Rs 4.5 lacs.

Telephone: One phone at least at business premises.

Documents required:



years.


certificate/SSI registered certificate/Sales Tax certificate

Bank Statement:- NA.




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Loans Offered:

Asset / Medical Equipment Finance : For purchase of CT Scanners, Color

Doppler‘s, Sonography Machines, MRI, X-Ray Machines, and other medical

equipment.

Infrastructure Loan: For purchase of new premises for setting up of

Clinics, Diagnostic Centers and Hospitals.

Corporate Term Loan: To provide term loan for the functioning of the

Healthcare entity, hospital or clinic.

Balance transfer of existing Term Loan or Working Capital : To transferan existing term loan from the old bank to our bank.

ME-OD Facility: Healthcare customers can avail OD limits for their

working capital requirement against the total credit card swipes made per

month on HDFC Bank Credit Card terminal installed in their facility.

Working Capital Requirement : We provide working capital facility by

way of Cash Credit, Overdraft or Demand Loan for funding day-to-day

operational requirements like purchase of consumables, maintenance, salary,

etc.

Who can Avail This Loan?

Nursing Homes, Diagnostic Centers, Pathology Lab Centers, Specialty

Clinics like Skin & Dental, Dialysis Centers, Endoscopy Centers, Hospitals,

and IVF Centers.

Medical Education Institutes like medical/paramedical colleges, dental

colleges.




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Large Medical Equipment Dealers.

Medical Equipment Manufacturers.

Medical Consumable Dealers.

Pharmacy Manufacturers.

Loan Features / Benefits:

Complete Solution for Healthcare Industry with Equipment Finance, Project

Finance, Working Capital Limits, BGs, Letter of Credit, Buyers Credit,

FCNR funding, etc.

Customized and structured solutions within regulatory norms based on client

requirements.

Tenure ranging from 12 months to 84 months as per project requirement.

Comprehensive solutions at competitive pricing which gives opportunity for

balance transfers from other financial institutions.

Kisan Vikas Patra (KVP).

Gold Deposit Certificates.

Non Convertible Debentures

Securities should be in the name of eligible borrowers (Securities in the

name of minors, Trusts, partly paid up or shares in the name of individuals

in companies of which they are Directors/ Promoters cannot be accepted).






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Fees & Charges For Loans Against Securities :

Overdraft facility:

Description of charges Loans against security

Processing Charges Upto 2% of the overdraft limit with

minimum of Rs.1250/- at the time of setting

up the limit or enhancement or annual

renewal. (In case of mid-term enhancement

of limits, processing fees will be charged

only on a pro-rata basis)

Pre-payment charges Nil

Duplicate no due certificate / NOC Nil

No Due Certificate / No Objection

Certificate (NOC)

Nil

Solvency Certificate Not Applicable

Charges for changing from fixed

to floating rate of interest

Not Applicable

Charges for changing from

floating to fixed rate of interest

Not Applicable

Stamp duty & other statutory

charges

As per the rates applicable at the place of

execution of Loan Agreement




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Annual Maintenance

Charge(AMC)

Upto 0.5% of the overdraft limit with

minimum of Rs. 500/- subject to maximum

of Rs. 10,000/-.

Rs.500/- for accounts where AMC was

defined as NIL at the time of execution of

Loan Agreement. Minimum Rs. 500/- and

maximum Rs. 10,000/- where AMC has

been set as a percentage of the Limit




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CONCLUSION

Banks provide security and convenience for managing your money and

sometimes allow you to make money by earning interest. Convenience and

fees are two of the most important things to consider when choosing a bank.

Writing and depositing checks are perhaps the most fundamental ways to

move money in and out of a checking account, but advancements in

technology have added ATM and debit card transactions and ACH transfers

to the mix.

All banks have rules about how long it takes to access your deposits, how

many debit card transactions you're allowed in a day, and how much cash

you can withdraw from an ATM. Access to the balance in your checking

account can also be limited by businesses that place holds on your funds.

Debit cards provide easy access to the cash in your account, but can cause

you to rack up fees if you're not careful.

While debit cards encourage more responsible spending than credit cards,they do not offer the same protection or perks to consumers.

Regularly balancing your checkbook or developing another method to stay

on top of your account balance is essential to successfully managing your

checking account and avoiding fees and bounced checks.

If you have more money than you need to manage your day-to-day expenses,

banks offer a variety of options for saving, including money market

accounts, CDs, high-interest online savings accounts and basic savings

accounts.




To protect your money from electronic theft, identity theft, and other forms

of fraud, it's important to implement basic precautions such as shredding

account statements, having complex passwords and only doing online

banking through secure internet connections.

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