a study on financial performance of hdfc bank

8/13/2019 A Study on Financial Performance of HDFC Bank

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INTRODUCTION TO BANKING SECTOR

Banks play a role of considerable economic significance as intermediaries in

mobilizing public savings and channelizing the flow of funds for productive purposes,

keeping on the process of the economic growth of the country. Realizing the importance of

the role of the banks in economic development, Government of India/Reserve Bank of India

took several maor initiatives after the country attained independence to gear the banking

system to serve the national obective. !ne of the most momentous of such initiatives was

the substitution of private ownership by public ownership, through the medium of an

ordinance, of the "# largest commercial banks in the private sector on "$ %uly "$&$. 'his has

popularly come to be known as nationalization of these banks without which it would not

have been possible to transform the class banking into mass banking and align bank credit to

serve the planned priorities and social needs. Branch e(pansion programmers formulated by

the Reserve Bank of India aimed at making available necessary banking facilities in all parts

of the country specially the unbanked rural and semi urban areas. 'his was perceived as

essential for implementation of proect for rural development and up liftment of

economically weaker sections and also spreading the banking habit even in the remote areasof the country.

Banks assisted in the rehabilitation of sickly weak industrial units and in the prevention of

unemployment, which would result from the closure of industrial units for want of credit.

)easures thus mentioned substantially contributed to the channelizing of the bank credit

"


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tithe various sectors of the economy which involve inter alia, flow of credit to sectors, which

were hitherto neglected or the so called *priority sectors+. n efficient financial sector is an

engine for economic growth. It converts the fuel of savings into kinetic energy for the

economy. 'he banking industry which is at the core of the financial sector must take the lead.

'he reform process started in the $-+s has given the industry a great opportunity. ot only

must the sector become more efficient it must also identify sectors having growth

opportunities and devise strategies to move savings into these sectors.

CURRENT SCENARIO

urrently, overall banking in India is considered as fairly mature in terms of supply,

product range and reaches even though reach in rural India still remains a challenge for the

private sector and foreign banks. 0ell1 computerized foreign banks are beginning to compete

seriously with the nationalized banks. 'hey aim at a profitable and wealthy part of the market

and, in contrast to the nationalized banks, do not recognize any social responsibilities to

small account holders or to a rural and semi urban clientele. lmost 2-3 of the businesses

are still controlled by 4ublic 5ector Banks 645Bs7. 45Bs are still dominating the commercial

banking system. 'he bank system is facing the challenges with stiff competition and

advancement of technology8 the services provided by banks have become more easy and

convenient.

'he competitive character has been promoted by facilitating the entry of foreign banks. 'he

country is flooded with foreign banks and theorem stations. 9fforts are being put to give a

satisfactory service to customers. 4hone banking and net banking are introduced. 'he entire

system has become more convenient and swift. 'ime is given more importance than money.

BANKING SERVICES

0ith years, banks are adding services to their customers. 'he Indian banking industry

is passing through a phase of customers market. :e customers have more choices in

choosing their banks. competition has been established within the banks operating in India.

'he new age I' 6Information 'echnology7 is bringing about sweeping changes in the

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banking industry, forcing them to re1engineer many of their basic processes and systems.

6%ankiraman "$$#7.

BANKING TECHNOLOGY


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'he committee observed that modern banking involves great deal of processing of

mass of information and commitment to technology is the only solution that ensures

timeliness, accuracy and resultant improved performance and enhanced customer service

6Bide "$$A7. !n similar lines, several academicians and practitioners argued that technology

in banks would help to increase the level of productivity and customer satisfaction 6Girish

and 4reetha "$$A7. 'o meet the challenges posed by the entry of foreign banks, Indian banks

will have to invest heavily in technology to meet competition, reduce cost, improve customer

service, improve productivity and offer new products/services. 'echnology in service

organizations is important for success. 5ome scholars have studied technology in service

organizations from different perspectives. :arsh 6"$$C7 studied beneficial aspects of

technology and identified five maor benefits of technology to a service organization.


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5tate Bank Instant Remittance 65BIR7 and 5tate Bank Rapid Remittance 65BRR7 when

remittances are made the same and the ne(t day respectively 65hanker "$$E7.)any authors,

while studying customer service and bank marketing, have observed that the need for

computerization/bank automation has arisen because customers e(pect their cheues to be

encased within a reasonable time, prompt realization of clearing cheues, a uick transfer of

funds and timely receipt of correct statements of their accounts etc. 6hidambaramand

lamelu "$$&7. ll this can be possible if banks are automated

BF5I955 5'R'9G

Increasing market share in India+s e(panding banking

@elivering high uality customer service )aintaining current high standards for asset uality through disciplined credit risk

management

@evelop innovative products and services that attract targeted customers and

address inefficiencies in the Indian financial sector.

E


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INTRODUCTION TO BANKING SECTOR

'he :ousing @evelopment


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e(cellence would help us get there. 'oday, we are proud to say that we are well on our

way towards that goal.

:I5'!R !< :@


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DISTRIBUTION NET9ORK

:@


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have been designed keeping in mind needs of customers who seeks distinct financial

solutions, information and advice on various investment avenues.

$

INTEGRATEDINTEGRATEDFINANCIALFINANCIALSERVICESSERVICES

SECURITISATION

Future Activities

DISTRIBUTION

HDFC CHUBB GENERALINSURANCE CO. LTD.


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:@


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2anagement : HDFC Ban%

Name Designation

C M Vasudev Chairman

Paresh Sukthankar Executive Director

Pandit Palande DirectorBobby Parikh Director

Keki Mistry Director

Name Designation

Aditya Puri Managing Director

Renu Karnad Director

Partho Datta Director

A N Roy Director

Vijay Merhant Director

BUSINESS SEG2ENT

:@


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recognized as a leading provider of cash management and transactional banking solutions to

corporate customers, mutual funds, stock e(change members and banks.

Reta3 Ban%ng Se!&'es;

'he obective of the Retail Bank is to provide its target market customers a full range

of financial products and banking services, giving the customer a one1stop window for all

his/her banking reuirements. 'he products are backed by world1class service and delivered

to the customers through the growing branch network, as well as through alternative delivery

channels like ')s, 4hone Banking, et Banking and )obile Banking.

'he :@


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treasury products are provided through the banks 'reasury team. 'o comply with statutory

reserve reuirements, the bank is reuired to hold ;E3 of its deposits in government

securities. 'he 'reasury business is responsible for managing the returns and market risk on

this investment portfolio.

.

4R!@F' !< :@


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'hese accounts are primarily meant to inculcate a sense of saving for the future,

accumulating funds over a period of time. 0hatever person+s occupation, bank have

confident that person will find the perfect banking solution. 'here some saving accounts likeJ

1

Regular 5aving ccountJ

n easy1to1operate savings account that allows you to issue cheues, draw @emand @rafts

and withdraw cash. heck up on your balances from the comfort of your home or office

throughet Banking, 4hone Banking and )obile Banking. If you need money urgently then

you can take money from the ') machine. 'here are "$AA ') centers across the

country.

Sa&ng #3"s A''o"nt

Introducing the best banking option for you with :@


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Seno! Ct=en A''o"nt

:@


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K)0s a)&antage a''o"nt

5tart saving for your child today and secure his/her future a sentence tells by the :dfc bank.

!pen a 5avings ccount and transfer money every month into customer+s Dids dvantage

ccount and watch the savings grow as customer+s child grows. 'he accumulated savings in

the Dids dvantage ccount can over the years help in meeting customer childs needs.

)ain features and benefits of this account are as followJ1

C"!!ent a''o"nts

:@


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In todays changing business reuirements, you need to transfer funds across cities, and time

is of the essence. :@!em"m '"!!ent a''o"nt

Business needs a partner who can manage finances while concentrate on growing business.


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o more paperwork, no more receipts to keep track of 1 a hassle1free account that allows

deposit the reimbursements receive from company/organization on a monthly basis.

'o open this account a person has to follow these processesJ

4rocure an ccount !pening @ocument 6!@7 from :@


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maintained in account. 0hat+s more, during lean seasons, person need not worry about

maintaining huge balances to enoy high transaction limits, which person anyway may not

need.


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If people believe in long1term investments and wish to earn higher interests on his/her

savings, now is the time to invest money in :@


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@o you wish to avoid taking overdrafts, and still take advantage of your


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dvantages of safe deposit locker in :@


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Fsed car loan.

'ractor loan 6for agree culture business7.

ommercial vehicle loan.

5o, as per the reuirement of the person there are these types of loans are available this are

at the chip rate and hassel free from more documentation and other procedure. nd

commercial businessman can get the benefits of the commercial vehicles loans. 'hus as per

the need of different people there are vehicle loans available. nd also terms and condition

are different as per the reuirement.

E


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owadays important of education becoming very high. 5s it important becoming high it is

becoming costly. 5o in the higher education some time people cannot effort a high price at a

same time. 5o, there is education loan is also available for the student. person can get loan

up to "- lakhs to study in India and ;- lakhs if he wants to study in abroad. Hoan available

up to tenure of A years including moratorium period. Hoans disbursed directly to the

educational institution. It is released as per fee schedules of institutes. 9(clusive 'elegraphic

'ransfer facility available for courses abroad. Hoans available for short duration/ ob oriented

courses also.

Loan aganst se'"!t6

0ith :@


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'hese are loans services providing by :@


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In today+s competitive and fast time card services providing by the banks are really very

important to every person and every business needs or to take meal in to the hotel or to

purchase ewellery from the ewellery shops cards are playing good role in the banking

sectors.

Bank ranges of ards help to meet financial obectives. 5o whether persons are looking

to add to his buying power, conducting cashless shopping, or budgeting his e(penditure, he

will find a card that suits him.

C!e)t 'a!)s

person wants many things like, a trip to Bali, a diamond ring for wifes dreams. 5omedreams cant wait. If theres something person has always wanted. If a person wanted fulfills

his wants he can get benefits from the :@


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De$t 'a!)

:@


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I?95)9' @ I5FR9 59R?I9

owadays a ward investment is becoming more popular. 4erson invest their money in to

various schemes or in to the gold or share market etc. but some time he is in to the difficult

situation, for that bank help person invest wisely through financial and investment services.

'ypes of investmentJ 1

GENERAL AND HEALTH INSURANCE

omplete protection for business, health, travel K more.

Bonds

secure investment avenue giving stable returns with ta( benefits.


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'he following are different methods of transacting in


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on :@


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Bill 4ay

4ay your telephone, electricity and mobile phone bills at your convenience. 'hrough the

Internet, ')s, your mobile phone and telephone 1 with Bill 4ay, our comprehensive bill

payments solution.

?isa Bill 4ay

4ay your utility bills from the comfort of your home 4ay using your :@


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@irect 4ay

5hop or 4ay bills online without cash or card. @ebit your account directly with our @irect

4ay service

?isa )oney 'ransfer

'ransfer funds to any ?isa ard 6debit or credit7 within India at your own convenience

through :@


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I)49RI/4R9


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RI BDIG

0ith a view to attract the savings and other remittance into India through banking channels

from the person of Indian ationality / !rigin who are residing abroad and bolster the

balance of payment position, the Government of India introduced in "$A- on1

Resident69(ternal7 ccount Rules which are governed by the 9(change ontrol Regulations.

'he funds held in on1Resident 69(ternal7 ccounts 6R9 ccounts7 ualify for certain

benefits like e(emptions from ta(es in India, free repatriations facilities, etc.

De#ost t6#esRI1Banking facilitates the RI customer to open the following account types.

NRE @Non Res)ent E


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0:!H95H9 BDIG

0holesale banking is the provision of services by banks to the like of large corporate

clients, mid1sized companies, real estate developers and investors, international trade finance

businesses and institutional customers, such as pension funds and government

entities/agencies. lso included is banking services offered to other financial institutions. In

essence, wholesale banking services usually involve high value transactions. 0holesale

banking compares with retail banking, which is the provision of banking services toindividuals.

0holesale banking services

orporate service

orporate Banking reflects :@


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'he following links will help identify individual needs.


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is done by the bank too.

2anagement : HDFC Ban%

Name Designation

C M Vasudev Chairman

Paresh Sukthankar Executive DirectorPandit Palande Director

Bobby Parikh Director

Keki Mistry Director

Name Designation

Aditya Puri Managing Director

Renu Karnad Director

Partho Datta Director

A N Roy Director

Vijay Merhant Director

S9OT ANALYSIS OF HDFC

C$


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St!engths

:@


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:@


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5tandalone Balance sheet

Balance Sheet of HDFCBank

!!!!!!!!!!!!!!!!!!! in Rs" Cr" !!!!!!!!!!!!!!!!!!!

Mar '13 Mar '12 Mar '11 Mar '10 Mar '0

12 mth! 12 mth! 12 mth! 12 mth! 12 mth!

Ca"ital an# $ia%ilitie!&

otal Share Ca"ital ()*+,, (-+3( (-*+23 (*)+)( (2*+3,

E.uit/ ShareCa"ital

()*+,, (-+3( (-*+23 (*)+)( (2*+3,

Share ""licationMone/

0+00 0+30 2+1 0+00 (00+2

reference ShareCa"ital

0+00 0+00 0+00 0+00 0+00

e!erve! 3*)3,+2- 2(**+0( 2(11+13 210-(+)* 1(22-+(3

evaluation

e!erve!

0+00 0+00 0+00 0+00 0+00

4et 5orth 3-21(+1( 22(+-, 2*3)+2) 21*22+( 1*0*2+)3

De"o!it! 2-2(-+,

2(-)0-+(* 20,*,-+(1 1-)(0(+(( 1(2,11+*,

Borro6ing! 3300-+-0 23,(-+*1 1(3(+0- 121*+- 2-,*+,(

otal De%t 322*3+*,

2)0**2+- 222,0+() 1,0320+13 1(*()+(2

7ther $ia%ilitie! 8rovi!ion!

3(,-(+1) 3)(31+,) 2,2+,- 20-1*+( 22)20+-2

otal $ia%ilitie! (00331+,

33)0+*1 2))3*2+-0 222(*,+*- 1,32)0+))

Mar '13 Mar '12 Mar '11 Mar '10 Mar '0!!et!

Ca!h 8 Balance!6ith B9

1(-2)+(0 1(1+0 2*100+,2 1*(,3+2, 13*2)+21

Balance 6ithBank! Mone/ atCall

12-*2+)) *(-+-3 (*-,+02 1((*+11 3)+(1

#vance! 23)20+-(

1*(20+03 1*,2+-) 12*,30+* ,,,3+0*

9nve!tment! 111-13+-0

)(,2+1 )02+3) *,-0)+-2 *,,1)+**

:ro!! Block 2)03+0, 23()+1 21)0+-* ()0)+) 3*-+-3

ccumulate#De"reciation

0+00 0+00 0+00 2*,*+1- 22(+0

4et Block 2)03+0, 23()+1 21)0+-* 2122+,1 1)0-+)3

Ca"ital 5ork 9nrogre!!

0+00 0+00 0+00 0+00 0+00

7ther !!et! 101(+(1 21)21+-( 1(-01+0, ***+1* -3*-+,3

otal !!et! (00331+ 33)0+( 2))3*2+-1 222(*,+*- 1,32)0+),

#;


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0

Contingent$ia%ilitie!

)(-22-+3

,,3,*+32 *,,**0+, (--23-+2( 3-*(+31

Bill! for collection 0+00 0+00 0+00 20(0+13 1)3+-2

Book ;alue


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9nve!tment! 110-0+(1

-)*+11 )02)-+-) *,*0,+2, *,)1*+1*

:ro!! Block -***+-3 -02(+0 *32,+,- ()))+-* (01+-,

ccumulate# De"reciation 3),2+32 3-(-+ 312)+1 2-2,+* 22,)+(0

4et Block 2))3+31 23))+1 2200+* 21(+0- 1)32+2,

Ca"ital 5ork 9n rogre!! 0+00 0+00 0+00 0+00 0+007ther !!et! 1212+, 20(03+- 13-2-+33 *20*+0) **2,+,

Minorit/ 9ntere!t 0+00 0+00 0+00 0+00 0+00

:rou" Share in >oint ;enture 0+00 0+00 0+00 0+00 0+00

otal !!et! (0))22+,

33*,+-)

2)-))3+-*

222103+33

1,2*(0+,*

Contingent $ia%ilitie! -,0-(+3(

,((33+(

**)1,+,-

(--30+)3

3--3+,

Bill! for collection (,1-3+*1 3-10+)1 2,,-+10 20(0+13 1)3+-2

Book ;alue


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Stan)a3one >!oft an) 3oss a''o"nt of HDFC

rofit 8 $o!! account ofHDFC Bank

!!!!!!!!!!!!!!!!!!! in Rs" Cr" !!!!!!!!!!!!!!!!!!!



9ncome

9ntere!t Earne# 3*0-(+,) 2)2,-+3* 12,+21 1-1)2+0 1-332+2-

7ther 9ncome -,*2+-2 *2(3+- (33*+1* 3,10+-2 3()0+-3

otal 9ncome (11)+( 32*30+0( 2(2-3+3- 1,3+*2 1,02+,

Ex"en#iture

9ntere!t ex"en#e# 12*3+)* 1(,+*, 3,*+0, )),-+30 ,11+10

Em"lo/ee Co!t 3-*+3, 33+1 2,3-+0( 22,+1, 223,+20

Selling an# #min Ex"en!e! 0+00 0+00 0+00 33*+,3 2,*1+2-

De"reciation -*1+-) *(2+*2 ()+(1 3(+3 3*+1

Mi!cellaneou! Ex"en!e! 11320+(1 ,(30+- )-1,+(3 31-+12 31)+(

reo"erative Ex" Ca"itali?e# 0+00 0+00 0+00 0+00 0+00

7"erating Ex"en!e! 1123-+12 ,*0+0) )1*2+1 ))03+(1 )20+--

rovi!ion! 8 Contingencie! ()01+3( 3),3+32 3),+) 1*(*+11 13*-+20

otal Ex"en!e! 3*11+21 2)3-2+) 2033-+- 1)03(+,2 1)**)+-



4et rofit for the @ear -)2-+2, *1-)+0 32-+(0 2(,+)0 22((+(

Extraor#inar/ 9tem! 0+00 0+00 0+00 A0+3 A0+*rofit %rought for6ar# ,3+-* -1)(+2( (*32+) 3(**+*) 2*)(+-3

otal 1*12*+3 113(1+33 ,(*+1 -(03+3( (,1,+,

reference Divi#en# 0+00 0+00 0+00 0+00 0+00

E.uit/ Divi#en# 130+0, 100+0, )-)+-2 *(+2 (2*+3,

Cor"orate Divi#en# ax 222+(, 1-3+)0 12(+*3 1+23 )2+2

er !hare #ata


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E.uit/ Divi#en#


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Cor"orate Divi#en# ax 222+(, 1-3+)0 12(+*3 1+23 )2+2

er !hare #ata !oft $efo!e Ta< >!oft afte! Ta!oft Befo!e Ta

a study on financial performance of hdfc bank

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