PROJECT REPORT ON

CREDIT SCHEMES IN HDFC,NIZAMABAD

Project Report submitted to J awaharlal Nehru Technological University,
Hyderabad,
In partial fulfillment of the requirements for the award of the degree of
MASTER OF BUSINESS ADMINISTRATION
Submitted by:
Mr./Ms._____________________________
H.T.No._____________________________
Under the esteemed guidance of
Mr./Ms._________________________
Associate/Assistant Professor





DEPARTMENT OF BUSINESS MANAGEMENT
VIJAY RURAL ENGINEERING COLLEGE, NIZAMABAD
(Approved by AICTE, New Delhi and Affiliated to JNTU Hyderabad)
2012-2014





DECLARATION


I hereby declare that the work described in this project entitled --------------------------
---------------------------------------- carried out at -----------------------------------. which
is being submitted by me in partial fulfillment for the award of degree of Master of
Business Administration in the Dept. of Business Management ,Vijay Rural
Engineering College , Nizamabad to the Jawaharlal Nehru Technological University
Hyderabad, Kukatpally, Hyderabad (Telanagana.) -500 085, is the result of
investigations carried out by me under the Guidance of Mr./Ms. --------------------------
------------------.

The work is original and has not been submitted in full /partial for any
Degree/Diploma of this or any other university or institution.





Place: Signature
Date:
Name of the Candidate:
Hall Ticket No.:
Email-Id:













COMPANY CERTIFICATE































CERTIFICATE

This is to certify that the project report entitled CUSTOMER
RELTIONSHIP MANAGEMENT BIG BAZAR is being submitted by Mr./Ms.---
---------------------------- (H.T.No. ------------------) in partial fulfillment for the award
of the Masters Degree in Business Administration (MBA) during the academic year
2014 to the JNTUH is a recorded of bonafide work carried out by him/her under the
guidance and supervision.
The results embodies in this project have not been submitted to any other
university or institute for the award of any degree or diploma.

Signature of the Internal guide Signature of the HOD
( ) ( )

Signature of the External Examiner Signature of the Principal

(Dr.B.R.VIKRAM)

ACKNOWLEDGEMENT

I take this opportunity to thank all who have rendered their full support to my
work. The pleasure, the achievement, the glory, the satisfaction, the reward, the
appreciation and the construction of our project cannot be thought without a few, how
apart from their regular schedule, spared a valuable time for us. This
acknowledgement is not just a position of words but also an account of the
indictment. They have been a guiding light and source of inspiration towards the
completion of the project.
I would like to express my hearted thanks to Mr. K.Narendhar Reddy Garu
Chairman, Mrs. Amrutha Latha Garu, Secretary and Dr. B.R.Vikram Garu,
Principal- Vijay Rural Engineering College for their kind consent to carry out this
project and also providing necessary infrastructure and resources to accomplish my
project work.
I express my profound sense of gratitude to Mr.---------------------------,
Associate Professor & Head of the Department of MBA, who has kindly permitted me
to do major project in any area of my choice and providing me all the facilities for the
project.
I am deeply indebted to my project guide Mr. ----------------------------,
Assistant Professor in Department of MBA for his valuable guidance, meticulous
supervision, support and sincere advice to complete the project successfully.
And I would like to express my sincere thanks to all the staff members of
MBA Department for their kind cooperation in completion of this project.
Finally, I thank to one and all those who have rendered help directly or
indirectly at various stages of the project and also my family members for their care
and moral support in finishing my project.

STUDENT NAME

H.T.NO
ABSTRACT























INDEX

























INTRODUCTION
BANKING
The word "BANK" is derived from the 'Bancus' or 'Banque', which means a bench. In
the early days the European moneylenders and moneychangers used to sit on the
benches and exhibit coins of different countries in big heaps for the purpose of
changing and lending money, :
Definition:
A Banking company is defined as a company, which transacts the business of banking
in India.
As per Banking Regulation Act 1949 Section 5(b)
"Banking means, accepting for the purpose of lending or investment, of deposits of
money from the public, repayable on demand or otherwise, and withdrawal by
cheque, draft, or otherwise."
According to Sir John Paget
"No person or body, corporate or otherwise can be a banker who does not, (a) take
deposits accounts, (b) take current accounts, (c) issue and pay cheques, (d) collect
cheques, crossed and uncrossed, for his customers."
In simple words we can say that bank is a financial institution which deals in
money and credit by obtaining deposits from public and giving loans and credit to
trade and industrial respectively. "
Brief restrictions imposed by the Banking Regulation Act 1949 on "Banking
Company"




1. Non-Banking Assets and its Disposal:
Non-Banking Assets are those assets acquired by the way of security while
lending money. It must be shown separately in the sheet and the bank should
dispose it within a period of seven years.
2. Minimum Limit of Paid Up Capital:
Rs. 10 Lakhs if incorporated in India and Rs. 20 Lakhs if incorporated outside
India.
3. Corporate Structure UIS 12:
Subscribed capital should not be less than 50% of authorized capital and paid
up capital should not be less than 50% of subscribed capital.
4. Maintenance of Reserve:
(a) Statutory Reserve: Section 17 makes it obligatory a banking company
to transfer 20% of annual profits every year to this reserve.
(b) Cash Reserve Ratio (CRR): U/S 17 of the act, a scheduled bank should
maintain with RBI an average daily balance (varies from time to time)
and deposits in India.
(c) Statutory Liquidity Rati.o (SLR): U/S 24 in addition to the above CRR,
every banking company has to maintain in India at least 33.75% not
exceeding 40% of its demand deposits in cash, gold (or) an
encumbered approved securities valued at a price not exceeding the
current market prices is known as SLR.
(d) Restriction on Payment of Dividends by a Banking Company U/S 15:
The banking company cannot pay dividend on its shares until all its
capital expenses and accumulated losses area are completely written
off.
5. No Banking Company can grant any Loan (or) Advance:
To the directors or other parties in which directors are interested.
FUNCTIONS OF BANKS
1. Primary Functions
(a) Acceptance of deposits
(b) Making Loans and Advances
Loans
Overdrafts
Cash Credit
Discounting of Bills of Exchange
2. Secondary Functions
(a) Agency Functions
Collection of cheques and bills etc
Collection of interest and dividend
Making payment on behalf of customers. Purchase and sale of
securities.
Facility of transfer of funds
To act as trustee and executor
(b) Utility Functions
Safe custody of customers valuable articles and securities.
Underwriting facility
Issuing of Travelers cheque and letter of credit
Facility of foreign exchange
Providing trade information
Providing information regarding credit worthiness of their
customers.

CLASSIFICATION ON BASIS OF OWNERSHIP
On the basis of ownership banks are of the following types:

1. PUBLIC SECTOR BANK
Public sector banks are those banks that are owned by the Government. The
Govt. runs these Banks. In India 14 banks were nationalized in 1969 & in
1980 another 6 banks were also nationalized. Therefore in 1980 the number of
nationalized bank 20. But at present there are 9 banks are nationalized. All
these banks are belonging to public sector category. Welfare is their principle
objective.
2. PRIVATE SECTOR BANKS
These banks are owned and run by the private sector. Various banks in the
country such as ICICI Bank, HDFC Bank etc. An individual has control over
there banks in preparation to the share of the banks held by him.
3. CO-OPERATIVE BANKS
Co-operative banks are those financial institutions. They provide short term &
medium term' loans to there members. Co-operative banks are in every state in India -
Its branches at district level are known as the central co-operative bank. The central
co-operative bank in turn has its branches both in the urban & rural areas. .Every state
cooperative bank is an apex bank, which provides credit facilities to the central co-
operative bank. It mobilized financial resources from richer section of urb3n
population by accepting deposit and creating the credit like commercial bank and
borrowing from the money mkt. It also gets funds from RBI

SCOPE OF THE STUDY
Theory without proctise is sterile,Practise without theory is blind;
The study was related to analyze the various schemes provided by HDFC
Bank and the customers responses regarding its different products. Schemes that are
covered under the project were saving accounts, current accounts, DEMAI A/c fixed
deposits and some other schemes. Study includes the extensive survey in which more
than 120 customers were interviewed. Although survey was confined to Nizamabad
one can easily interpret the general overview. During my project I realized that now
banking business become more personal in nature as bank staff tries to exploit their
own contacts and pays more attention on the customers. In the end I would like to say
that HDFC has proved itself one of the best player in the banking industry through its
side range of services and its customer satisfaction.


SIGNIFICANCE OF THE STUDY
This study entitled comparative study of various credit schemes of HDFC will be
helpful for bankers to maintain customers service policy, for customers while
deciding their financing needs and also helpful for other researchers for further
research in the future.
This study would help us to know about the problems that are faced by the consumers
during transactions. It would also reveal the problems that are being faced by the bank
employees while dealing with customers and would also highlight the future prospect


OBJECTIVES OF THE STUDY
1. To find out the market potential of HDFC in Nizamabad
2. To know customers perceptions about various credit schemes of different banks.
3. To compare the credit schemes of different banks.
4. To find out main obstacles while getting finance under various credit schemes.
RESEARCH METHODOLOGY

Research is any organized inquiry carried out to provide information for
solving problems. Business research is a systematic inquiry that provides information
to take business decisions.

Definition
Research comprises of defining and redefining hypothesis or suggesting
solution, collecting, organizing and evaluating data making deductions and
reaching conclusions.
By Cliford Woody

The term Research Methodology here comprises of all research activities
carried on in connection with the Analysis is various schemes under Saving,
Current and Fixed Deposit Accounts Provided by HDFC Bank.

The basis purpose of Research Methodology is to describe the research
procedure. It helps the researchers to the way to move on for carrying the study.

Formulation of research problem

Extensive literature survey

Research Design

Collection of data

Analysis of Data

Interpretation

Recommendation








RESEARCH DESIGN


There are many definitions of research design, but no definition imparts the
full range of important aspects. Several examples from leading authors can be cited.
Research design is like arrangement of conditions for collection and analysis
of data that aims to combine relevance to the research purpose with economy
in procedures.
Research design is purely and simply the framework of plans for a study that
guides the collections and analysis of data.
Research design is the conceptual structure within which the research is
conducted.

These definitions differ in detail, but together they give the essentials of
research design. First, the design is a plan for selecting the sources and types of
information used to answer the research question. Second, it is a framework for
specifying the relationship amount the various variables. Third, it is a blueprint that
outlines each procedure from the hypothesis to the analysis of data. The design
provides answers for such questions as these:

Why the study is being made?
What techniques will be used togather data?
What kind of sampling will be used?
How will time & cost constraints be dealt with?
How the data can be analysed? In my study the organization was HDFC Bank
and sample size was around 100 persons.






TYPES OF RESEARCH DESIGN







SOURCE OF DATA COLLECTION


To make the research complete it is very necessary to have useful and
authentic data. There are two types of data collection sources.

PRIMARY SOURCE OF DATA COLLECTION

Primary data are those, which are collected afresh & for the first time & this
happen to be original in character. In my project simple well-drafted questionnaire
was circulated among all respondents. Full freedom was provided to an individual to
answer the questions.

Personal & Telephonic interviews, observation, personal opinion &
viewpoints of the respondents about the various schemes helped incompletion of the
project.

SECONDARY SOURCES OF DATA COLLECTION

These are those which are collected by someone else & which have been
passed through statistical process.

Brouchers, Manual, Journals, Magazines, Site of HDFC Bank and
Various Articles lot many inputs for successful completion of project.

Exploratory Research
design
Descriptive/ Diagonostic
Research Design
Experimental Research Design

STATISTICAL TOOL


TIME SERIES

MEANING:
The set of data collected on the basis is called as Time Series. In other words,
when datas are observed on the basis of time, days, month or years, these are known
as time series. Under time series, there are two types of variables:
1. Independent variables: This represents the Time.
2. Dependent variables: This represents chances taking place in the value of data
(population, sales, production etc.) with the passage of time.

DEFINITION:
A set of data depending on the time is called time series.
KENNY AND KEEPING

A time series consists of data arranged chronological.
CROXTON AND COWDEN

UTILITY OF TIME SERIES:
The study of time series has great importance in economic and business world.
Some of the utilities of time series are:
1. To study the past behavior of the data.
2. To forecast future behavior
3. Estimation of trade cycles
4. Comparisons with other time series
5. Study of present variations
6. Universal utility.



LEAST SQUARE METHOD:
This is the best method of trend fitting in a time series and is most used in
practice. This is a mathematical method and a trend line in the method is fitted or
obtained in such a way that following two conditions are fulfilled.

Merit and Demerit of least square method
Merits:
This method is far better than moving average method because the trend
values for all the years are obtained. Not even a single initial or terminal
trends value is left over in this method.

It results in a mathematical equation, which may be used for forecasting.

It is widely used method of fitting a curve to the given data. The results
obtained are reliable and appropriate.


Demerits:

The computation process in this method is complex which is not easily
understandable.

This method does not have the attribute of flexibility. If some figures are
editing to or subtracted from original data, all computation has to be redone.

It is difficult to select an appropriate type of equation in this method.




LIMITATIONS OF THE STUDY

Due to constraints of time & resources the present study is likely to suffer
from certain limitations some of these are mentioned below, so that study can be
understood in a proper way :

Area covered under the report as sample size was very small.
The research was carried out in a short period of 6-7 weeks as a part of
summer training. The project was completed within the given time frame.
Some of the respondents of the survey were unwilling to give information.
Sometimes wrong respondents provided information, which needed to be,
crosschecked & verified.
Chances of biasness are there because of the use of convenient sampling.
Some respondents were not available and thus needed data could not be found.
Availability of data was a constraint due to only on those schemes are
considered, which is available.
Though every Precaution has taken due to large data & complex calculation there
may be chance of errors.
LITERATURE REVIEW

Review of literature has vital relevance with any research work due to literature
review the possibility of repetition of study can be eliminated and another dimension
can be selected for the study. The literature review helps researcher to remove
limitations of existing work or may assist to extend prevailing study.

Several research have been conducted to analyse the different aspects of performance
of commercial banks in India and abroad. But there are very few research and
literature available on the subject related to financial reforms and its impact on Indian
banks.

The available literature and research are

divided into four major parts according to the area of research i.e literature related to:
1. Review of Literature related to Performance Appraisal of Banks
2. Review of Literature related to Policy Framework and Recommendations for
Banks
3. Review of Literature related to Impact of Reforms on Indian Banks 4. Review of
Literature related to Service Quality of Indian Banks2 The above mentioned literature
have been obtained from following four major sources such as (i) Ph.D. research
conducted in India, (ii) The research / studies c arried over by the institutions like
RBI, ICRA Limited and business magazines like Financial Express, Business Today,
Money Outlook, Business India, etc. and (iii) Research Studies of individual scholars
published in journals and magazines and (iv) websites of RBI, Govt. of India and
websites of various banks.

The present study is undertaken in the light of the methodology adopted and
conclusions emerged in the earlier studies relating to the performance evaluation,
financial reforms and their impact on the Indian banking sector. and a comparison
between the two.




Company profile& industrial profile:-
A bank is a financial institution that accepts deposits and channels those
deposits into lending activities. Banks primarily provide financial services to
customers while enriching investors. Government restrictions on financial activities
by banks vary over time and location. Banks are important players in financial
markets and offer services such as investment funds and loans. In some countries such
as Germany, banks have historically owned major stakes in industrial corporations
while in other countries such as the United States banks are prohibited from owning
non-financial companies. In Japan, banks are usually the nexus of a cross-share
holding entity known as the keiretsu. In France, bancassurance is prevalent, as most
banks offer insurance services (and now real estate services) to their clients.
The level of government regulation of the banking industry varies widely, with
countries such as Iceland, having relatively light regulation of the banking sector, and
countries such as China having a wide variety of regulations but no systematic
process that can be followed typical of a communist system.
The oldest bank still in existence is Monte dei Paschi di Siena, headquartered in
Siena, Italy, which has been operating continuously since 1472.



History
Origin of the word:-
The name bank derives from the Italian word banco "desk/bench", used during
the Renaissance by Jewish Florentine bankers, who used to make their transactions
above a desk covered by a green tablecloth. However, there are traces of banking
activity even in ancient times, which indicates that the word 'bank' might not
necessarily come from the word 'banco'.
In fact, the word traces its origins back to the Ancient Roman Empire, where
moneylenders would set up their stalls in the middle of enclosed courtyards called
macella on a long bench called a bancu, from which the words banco and bank are
derived. As a moneychanger, the merchant at the bancu did not so much invest money
as merely convert the foreign currency into the only legal tender in Romethat of the
Imperial Mint.
The earliest evidence of money-changing activity is depicted on a silver drachm
coin from ancient Hellenic colony Trapezus on the Black Sea, modern Trabzon, c.
350325 BC, presented in the British Museum in London. The coin shows a banker's
table (trapeza) laden with coins, a pun on the name of the city.
In fact, even today in Modern Greek the word Trapeza () means both a
table and a bank.
Traditional banking activities:-
Banks act as payment agents by conducting checking or current accounts for
customers, paying cheques drawn by customers on the bank, and collecting cheques
deposited to customers' current accounts. Banks also enable customer payments via
other payment methods such as telegraphic transfer, EFTPOS, and ATM.
Banks borrow money by accepting funds deposited on current accounts, by
accepting term deposits, and by issuing debt securities such as banknotes and bonds.
Banks lend money by making advances to customers on current accounts, by making
installment loans, and by investing in marketable debt securities and other forms of
money lending.
Banks provide almost all payment services, and a bank account is considered
indispensable by most businesses, individuals and governments. Non-banks that
provide payment services such as remittance companies are not normally considered
an adequate substitute for having a bank account.
Banks borrow most funds from households and non-financial businesses, and
lend most funds to households and non-financial businesses, but non-bank lenders
provide a significant and in many cases adequate substitute for bank loans, and money
market funds, cash management trusts and other non-bank financial institutions in
many cases provide an adequate substitute to banks for lending savings to.
Entry regulation:-
Currently in most jurisdictions commercial banks are regulated by government
entities and require a special bank licence to operate.
Usually the definition of the business of banking for the purposes of regulation is
extended to include acceptance of deposits, even if they are not repayable to the
customer's orderalthough money lending, by itself, is generally not included in the
definition.
Unlike most other regulated industries, the regulator is typically also a
participant in the market, i.e. a government-owned (central) bank. Central banks also
typically have a monopoly on the business of issuing banknotes. However, in some
countries this is not the case. In the UK, for example, the Financial Services Authority
licences banks, and some commercial banks (such as the Bank of Scotland) issue their
own banknotes in addition to those issued by the Bank of England, the UK
government's central bank.


Definition:-
The definition of a bank varies from country to country.
Under English common law, a banker is defined as a person who carries on the
business of banking, which is specified as:
conducting current accounts for his customers
paying cheques drawn on him, and
collecting cheques for his customers.
In most English common law jurisdictions there is a Bills of Exchange Act that
codifies the law in relation to negotiable instruments, including cheques, and this Act
contains a statutory definition of the term banker: banker includes a body of persons,
whether incorporated or not, who carry on the business of banking' (Section 2,
Interpretation). Although this definition seems circular, it is actually functional,
because it ensures that the legal basis for bank transactions such as cheques do not
depend on how the bank is organised or regulated.
The business of banking is in many English common law countries not defined by
statute but by common law, the definition above. In other English common law
jurisdictions there are statutory definitions of the business of banking or banking
business. When looking at these definitions it is important to keep in minds that they
are defining the business of banking for the purposes of the legislation, and not
necessarily in general. In particular, most of the definitions are from legislation that
has the purposes of entry regulating and supervising banks rather than regulating the
actual business of banking. However, in many cases the statutory definition closely
mirrors the common law one. Examples of statutory definitions:
"banking business" means the business of receiving money on current or deposit
account, paying and collecting cheques drawn by or paid in by customers, the making
of advances to customers, and includes such other business as the Authority may
prescribe for the purposes of this Act; (Banking Act (Singapore), Section 2,
Interpretation).

"Banking business" means the business of either or both of the
following:-
receiving from the general public money on current, deposit, savings or
other similar account repayable on demand or within less than [3 months]
... or with a period of call or notice of less than that period;
paying or collecting cheques drawn by or paid in by customers
[6]

Since the advent of EFTPOS (Electronic Funds Transfer at Point Of Sale), direct
credit, direct debit and internet banking, the cheque has lost its primacy in most
banking systems as a payment instrument. This has led legal theorists to suggest that
the cheque based definition should be broadened to include financial institutions that
conduct current accounts for customers and enable customers to pay and be paid by
third parties, even if they do not pay and collect cheques.

Accounting for bank accounts:-
Bank statements are accounting records produced by banks under the various
accounting standards of the world. Under GAAP and IFRS there are two kinds of
accounts: debit and credit. Credit accounts are Revenue, Equity and Liabilities. Debit
Accounts are Assets and Expenses. This means you credit a credit account to increase
its balance, and you debit a debit account to decrease its balance.
This also means you debit your savings account every time you deposit money
into it (and the account is normally in deficit), while you credit your credit card
account every time you spend money from it (and the account is normally in credit).
However, if you read your bank statement, it will say the oppositethat you
credit your account when you deposit money and you debit it when you withdraw
funds. If you have cash in your account, you have a positive (or credit) balance; if you
are overdrawn, you have a negative (or deficit) balance.
The reason for this is that the bank, and not you, has produced the bank
statement. Your savings might be your assets, but the bank's liability, so they are
credit accounts (which should have a positive balance). Conversely, your loans are
your liabilities but the bank's assets, so they are debit accounts (which should also
have a positive balance).
Where bank transactions, balances, credits and debits are discussed below, they
are done so from the viewpoint of the account holderwhich is traditionally what
most people are used to seeing.
Economic functions:-
Issue of money, in the form of banknotes and current accounts subject to
cheque or payment at the customer's order. These claims on banks can act as
money because they are negotiable and/or repayable on demand, and hence
valued at par. They are effectively transferable by mere delivery, in the case
of banknotes, or by drawing a cheque that the payee may bank or cash.
netting and settlement of payments banks act as both collection and paying
agents for customers, participating in interbank clearing and settlement
systems to collect, present, be presented with, and pay payment instruments.
This enables banks to economise on reserves held for settlement of
payments, since inward and outward payments offset each other. It also
enables the offsetting of payment flows between geographical areas,
reducing the cost of settlement between them.
credit intermediation banks borrow and lend back-to-back on their own
account as middle men.
credit quality improvement banks lend money to ordinary commercial and
personal borrowers (ordinary credit quality), but are high quality borrowers.
The improvement comes from diversification of the bank's assets and capital
which provides a buffer to absorb losses without defaulting on its
obligations. However, banknotes and deposits are generally unsecured; if the
bank gets into difficulty and pledges assets as security, to rise the funding it
needs to continue to operate, this puts the note holders and depositors in an
economically subordinated position.
maturity transformation banks borrow more on demand debt and short
term debt, but provide more long term loans. In other words, they borrow
short and lend long. With a stronger credit quality than most other
borrowers, banks can do this by aggregating issues (e.g. accepting deposits
and issuing banknotes) and redemptions (e.g. withdrawals and redemptions
of banknotes), maintaining reserves of cash, investing in marketable
securities that can be readily converted to cash if needed, and raising
replacement funding as needed from various sources (e.g. wholesale cash
markets and securities markets).




Law of banking
Banking law is based on a contractual analysis of the relationship between the bank
(defined above) and the customerdefined as any entity for which the bank agrees to
conduct an account.
The law implies rights and obligations into this relationship as follows:
The bank account balance is the financial position between the bank and the
customer: when the account is in credit, the bank owes the balance to the
customer; when the account is overdrawn, the customer owes the balance to
the bank.
The bank agrees to pay the customer's cheques up to the amount standing to
the credit of the customer's account, plus any agreed overdraft limit.
The bank may not pay from the customer's account without a mandate from
the customer, e.g. a cheque drawn by the customer.
The bank agrees to promptly collect the cheques deposited to the customer's
account as the customer's agent, and to credit the proceeds to the customer's
account.
The bank has a right to combine the customer's accounts, since each account is
just an aspect of the same credit relationship.
The bank has a lien on cheques deposited to the customer's account, to the
extent that the customer is indebted to the bank.
The bank must not disclose details of transactions through the customer's
accountunless the customer consents, there is a public duty to disclose, the
bank's interests require it, or the law demands it.
The bank must not close a customer's account without reasonable notice, since
cheques are outstanding in the ordinary course of business for several days.
These implied contractual terms may be modified by express agreement between the
customer and the bank. The statutes and regulations in force within a particular
jurisdiction may also modify the above terms and/or create new rights, obligations or
limitations relevant to the bank-customer relationship.
Some types of financial institution, such as building societies and credit unions,
may be partly or wholly exempt from bank licence requirements, and therefore
regulated under separate rules.
The requirements for the issue of a bank licence vary between jurisdictions but
typically include:
Minimum capital
Minimum capital ratio
'Fit and Proper' requirements for the bank's controllers, owners, directors,
and/or senior officers
Approval of the bank's business plan as being sufficiently prudent and
plausible.
Types of banks:-
Banks' activities can be divided into retail banking, dealing directly with
individuals and small businesses; business banking, providing services to mid-market
business; corporate banking, directed at large business entities; private banking,
providing wealth management services to high net worth individuals and families; and
investment banking, relating to activities on the financial markets. Most banks are
profit-making, private enterprises. However, some are owned by government, or are
non-profit organizations.
Central banks are normally government-owned and charged with quasi-
regulatory responsibilities, such as supervising commercial banks, or controlling the
cash interest rate. They generally provide liquidity to the banking system and act as
the lender of last resort in event of a crisis.

Types of retail banks:-
Commercial bank: the term used for a normal bank to distinguish it from an
investment bank. After the Great Depression, the U.S. Congress required that
banks only engage in banking activities, whereas investment banks were
limited to capital market activities. Since the two no longer have to be under
separate ownership, some use the term "commercial bank" to refer to a bank or
a division of a bank that mostly deals with deposits and loans from
corporations or large businesses.
Community Banks: locally operated financial institutions that empower
employees to make local decisions to serve their customers and the partners.
Community development banks: regulated banks that provide financial
services and credit to under-served markets or populations.
Postal savings banks: savings banks associated with national postal systems.
Private banks: banks that manage the assets of high net worth individuals.
Offshore banks: banks located in jurisdictions with low taxation and
regulation. Many offshore banks are essentially private banks.
Savings bank: in Europe, savings banks take their roots in the 19th or
sometimes even 18th century. Their original objective was to provide easily
accessible savings products to all strata of the population. In some countries,
savings banks were created on public initiative; in others, socially committed
individuals created foundations to put in place the necessary infrastructure.
Nowadays, European savings banks have kept their focus on retail banking:
payments, savings products, credits and insurances for individuals or small
and medium-sized enterprises. Apart from this retail focus, they also differ
from commercial banks by their broadly decentralised distribution network,
providing local and regional outreachand by their socially responsible
approach to business and society.
Building societies and Landesbanks: institutions that conduct retail banking.
Ethical banks: banks that prioritize the transparency of all operations and
make only what they consider to be socially-responsible investments.
Islamic banks: Banks that transact according to Islamic principles.
Types of investment banks:-
Investment banks "underwrite" (guarantee the sale of) stock and bond issues,
trade for their own accounts, make markets, and advise corporations on capital
market activities such as mergers and acquisitions.
Merchant banks were traditionally banks which engaged in trade finance. The
modern definition, however, refers to banks which provide capital to firms in
the form of shares rather than loans. Unlike venture capital firms, they tend
not to invest in new companies.
Both combined:-
Universal banks, more commonly known as financial services companies,
engage in several of these activities. These big banks are very diversified groups that,
among other services, also distribute insurance hence the term bancassurance, a
portmanteau word combining "banque or bank" and "assurance", signifying that both
banking and insurance are provided by the same corporate entity.
Other types of banks
Islamic banks adhere to the concepts of Islamic law. This form of banking
revolves around several well-established principles based on Islamic canons. All
banking activities must avoid interest, a concept that is forbidden in Islam. Instead,
the bank earns profit (markup) and fees on the financing facilities that it extends to
customers.


Industrial profile

The Housing Development Finance Corporation Limited (HDFC):-

The Housing Development Finance Corporation Limited (HDFC) 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, as part of the RBI's liberalization of the Indian
Banking Industry in 1994. The bank was incorporated in August 1994 in the name of
'HDFC Bank Limited', with its registered office in Mumbai, India. HDFC Bank
commenced operations as a Scheduled Commercial Bank in January 1995.

OVERVIEW OF THE INDUSTRY
HDFC is India's premier housing finance company and enjoys an impeccable
track record in India as well as in international markets. Since its inception in 1977,
the Corporation has maintained a consistent and healthy growth in its operations to
remain the market leader in mortgages. Its outstanding loan portfolio covers well over
a million dwelling units. HDFC has developed significant expertise in retail mortgage
loans to different market segments and also has a large corporate client base for its
housing related credit facilities. With its experience in the financial markets, a strong
market reputation, large shareholder base and unique consumer franchise, HDFC was
ideally positioned to promote a bank in the Indian environment.
As on 31st December, 2009 the authorized share capital of the Bank is Rs. 550
crore. The paid-up capital as on said date is Rs. 455,23,65,640/- (45,52,36,564 equity
shares of Rs. 10/- each). The HDFC Group holds 23.87 % of the Bank's equity and
about 16.94 % of the equity is held by the ADS Depository (in respect of the bank's
American Depository Shares (ADS) Issue). 27.46 % of the equity is held by Foreign
Institutional Investors (FIIs) and the Bank has about 4,58,683 shareholders.
The shares are listed on the Bombay Stock Exchange Limited and The National
Stock Exchange of India Limited. The Bank's American Depository Shares (ADS) are
listed on the New York Stock Exchange (NYSE) under the symbol 'HDB' and the
Bank's Global Depository Receipts (GDRs) are listed on Luxembourg Stock
Exchange under ISIN No US40415F2002.
Mr. Jagdish Capoor took over as the bank's Chairman in July 2001. Prior to this,
Mr. Capoor was Deputy Governor of the RBI



MANAGEMENT
The Managing Director, Mr. Aditya Puri, has been a professional banker for over
25 years, and before joining HDFC Bank in 1994 was heading Citibank's operations
in Malaysia.The Bank's Board of Directors is composed of eminent individuals with a
wealth of experience in public policy, administration, industry and commercial
banking. Senior executives representing HDFC are also on the Board. Senior banking
professionals with substantial experience in India and abroad head various businesses
and functions and report to the Managing Director. Given the professional expertise
of the management team and the overall focus on recruiting and retaining the best
talent in the industry, the bank believes that its people are a significant competitive
strength.

BOARD OF DIRECTORS
Mr. Jagdish Capoor, Chairman
Mr. Keki Mistry
Mrs. Renu Karnad
Mr. Arvind Pande
Mr. Ashim Samanta
Mr. Chander Mohan Vasudev
Mr. Gautam Divan
Dr. Pandit Palande
Mr. Aditya Puri, Managing Director
Mr. Harish Engineer, Executive Director
Mr. Paresh Sukthankar, Executive Director
Mr. Vineet Jain (upto 27.12.2008)

REGISTERED OFFICE:-

HDFC Bank House,
Senapati Bapat Marg,
Lower Parel,
Website: www.hdfcbank.com
HDFC Bank offers a wide range of commercial and transactional banking
services and treasury products to wholesale and retail customers. The bank has three
key business segments
Wholesale Banking Services:-

The Bank's target market ranges from large, blue-chip manufacturing companies
in the Indian corporate to small & mid-sized corporates 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 of structured
solutions, which combine cash management services with vendor and distributor
finance for facilitating superior supply chain management for its corporate customers.
Based on its superior product delivery / service levels and strong customer
orientation, the Bank has made significant inroads into the banking consortia of a
number of leading Indian corporates including multinationals, companies from the
domestic business houses and prime public sector companies. It is recognised as a
leading provider of cash management and transactional banking solutions to corporate
customers, mutual funds, stock exchange members and banks.



Retail Banking Services:-

The objective of the Retail Bank is to provide its target market customers a full
range of financial products and banking services, giving the customer a one-stop
window for all his/her banking requirements. The products are backed by world-class
service and delivered to customers through the growing branch network, as well as
through alternative delivery channels like ATMs, Phone Banking, NetBanking and
Mobile Banking.
The HDFC Bank Preferred program for high net worth individuals, the HDFC
Bank Plus and the Investment Advisory Services programs have been designed
keeping in mind needs of customers who seek distinct financial solutions, information
and advice on various investment avenues. The Bank also has a wide array of retail
loan products including Auto Loans, Loans against marketable securities, Personal
Loans and Loans for Two-wheelers. It is also a leading provider of Depository
Participant (DP) services for retail customers, providing customers the facility to hold
their investments in electronic form.
HDFC Bank was the first bank in India to launch an International Debit Card in
association 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 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 well positioned as a leader 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.
With the liberalisation of the financial markets in India, corporates need more
sophisticated risk management information, advice and product structures. These and
fine pricing on various treasury products 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.



Awards and Achievements - Banking Services:-
2011

Outlook Money
Best Bank Award
2011
- Best Bank - Runner Up
Best Commercial
Vehicle Financier
- Driving Positive Change
Businessworld Best
Bank award
- Best Bank
BCI Continuity &
Resilience Award
- Most Effective Recovery of the Year
Financial Express
Best Bank Survey
2010-11
- Best in Strength and Soundness
- 2nd Best in the Private Sector
CNBC TV18's Best
Bank & Financial
- Best Bank
Institution Awards - Mr. Aditya Puri, Outstanding Finance Professional
Dun & Bradstreet
Banking Awards
2011
Best Private Sector Bank - SME Financing
ISACA 2011 award
for IT Governance
Best practices in IT Governance and IT Security
IBA Productivity
Excellence Awards
2011
New Channel Adopter (Private Sector)
DSCI (Data
Security Council of
India) Excellence
Awards 2011
Security in Bank
Euromoney Awards
for Excellence 2011
Best Bank in India
FINANCE ASIA
Country Awards
2011: India
- BEST BANK
- BEST CASH MANAGEMENT BANK
- BEST TRADE FINANCE BANK
Asian Banker Strongest Bank in Asia Pacific
BloombergUTV's
Financial
Leadership Awards
2011
Best Bank
IBA Banking
Technology
Winner -
1) Technology Bank of the Year
Awards 2010 2) Best Online Bank
3) Best Customer Initiative
4) Best Use of Business Intelligence
5) Best Risk Management System
Runners Up -
Best Financial Inclusion
IDC FIIA Awards
2011
Excellence in Customer Experience


Outlook Money
Best Bank Award
2011
- Best Bank - Runner Up
Best Commercial
Vehicle Financier
- Driving Positive Change
Businessworld Best
Bank award
- Best Bank
BCI Continuity &
Resilience Award
- Most Effective Recovery of the Year
Financial Express
Best Bank Survey
2010-11
- Best in Strength and Soundness
- 2nd Best in the Private Sector
CNBC TV18's Best
Bank & Financial
Institution Awards
- Best Bank
- Mr. Aditya Puri, Outstanding Finance Professional
Dun & Bradstreet
Banking Awards
2011
Best Private Sector Bank - SME Financing
ISACA 2011 award
for IT Governance
Best practices in IT Governance and IT Security
IBA Productivity
Excellence Awards
2011
New Channel Adopter (Private Sector)
DSCI (Data
Security Council of
India) Excellence
Awards 2011
Security in Bank
Euromoney Awards
for Excellence 2011
Best Bank in India
FINANCE ASIA
Country Awards
2011: India
- BEST BANK
- BEST CASH MANAGEMENT BANK
- BEST TRADE FINANCE BANK
Asian Banker Strongest Bank in Asia Pacific
BloombergUTV's
Financial
Leadership Awards
2011
Best Bank
IBA Banking
Technology
Awards 2010
Winner -
1) Technology Bank of the Year
2) Best Online Bank
3) Best Customer Initiative
4) Best Use of Business Intelligence
5) Best Risk Management System
Runners Up -
Best Financial Inclusion
IDC FIIA Awards
2011
Excellence in Customer Experience


2010
Global Finance
Award
Best Trade Finance Provider in India for 2010
2 Banking
Technology
Awards 2009
1) Best Risk Management Initiative and 2) Best Use of
Business Intelligence.
SPJIMR
Marketing Impact
Awards (SMIA)
2010
2nd Prize
Business Today
Best Employer
Survey
Listed in top 10 Best Employers in the country


:- Corporate Governance
The bank was among the first four companies, which subjected itself to a
Corporate Governance and Value Creation (GVC) rating by the rating agency, The
Credit Rating Information Services of India Limited (CRISIL). The rating provides an
independent assessment of an entity's current performance and an expectation on its
"balanced value creation and corporate governance practices" in future. The bank has
been assigned a 'CRISIL GVC Level 1' rating, which indicates that the bank's
capability with respect to wealth creation for all its stakeholders while adopting sound
corporate governance practices is the highest.We are aware that all these awards are
mere milestones in the continuing, never-ending journey of providing excellent
service to our customers. We are confident, however, that with your feedback and
support, we will be able to maintain and improve our services.
Technology:-

HDFC Bank operates in a highly automated environment in terms of
information technology and communication systems. All the bank's branches have
online connectivity, which enables the bank to offer speedy funds transfer facilities to
its customers. Multi-branch access is also provided to retail customers through the
branch network and Automated Teller Machines (ATMs).

The Bank has made substantial efforts and investments in acquiring the best
technology available internationally, to build the infrastructure for a world class bank.
The Bank's business is supported by scalable and robust systems which ensure that
our clients always get the finest services we offer. The Bank has prioritised its
engagement in technology and the internet as one of its key goals and has already
made significant progress in web-enabling its core businesses. In each of its
businesses, the Bank has succeeded in leveraging its market position, expertise and
technology to create a competitive advantage and build market share.

Mission and Business Strategy:-

Our mission is to be "a World Class Indian Bank", benchmarking ourselves
against international standards and best practices in terms of product offerings,
technology, service levels, risk management and audit & compliance. The objective is
to build sound customer franchises across distinct businesses so as to be a preferred
provider of banking services for target retail and wholesale customer segments, and to
achieve a healthy growth in profitability, consistent with the Bank's risk appetite. We
are committed to do this while ensuring the highest levels of ethical standards,
professional integrity, corporate governance and regulatory compliance.
Our business strategy emphasizes the following :

Increase our market share in Indias expanding banking and financial services
industry by following a disciplined growth strategy focusing on quality and
not on quantity and delivering high quality customer service.
Leverage our technology platform and open scaleable systems to deliver
more products to more customers and to control operating costs.
Maintain our current high standards for asset quality through disciplined
credit risk management.
Develop innovative products and services that attract our targeted customers
and address inefficiencies in the Indian financial sector.
Continue to develop products and services that reduce our cost of funds.
Focus on high earnings growth with low volatility.
HDFC Bank is headquartered in Mumbai. The Bank at present has an enviable
network of 1,725 branches spread in 771 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's expansion plans take into account the need to
have a presence in all major industrial and commercial centres where its corporate
customers are located as well as the need to build a strong retail customer base for
both deposits and loan products. Being a clearing/settlement bank to various leading
stock exchanges, the Bank has branches in the centres where the NSE/BSE have a
strong and active member base.
The Bank also has 3,898 networked ATMs across these cities. Moreover, HDFC
Bank's ATM network can be accessed by all domestic and international
Visa/MasterCard, Visa Electron/Maestro, Plus/Cirrus and American Express
Credit/Charge cardholders.

AIMS:
Continuous effort to improving the services.
Evaluating individual skill trough training and motivations.
Total involvement through participants management activities.
Creating healthy and safe environment.
Social development.