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8/2/2019 Nanu Ram Full Ready

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CHAPTER - 1

INTRODUCTION

A Bank is a financial institution that aspects deposits and channels those deposits into

lending activities. The banks primarily provide financial services to customers while the

main goal is enriching investors. Government restriction on financial activities by banks

vary over time and location. Banks are important players in financial markets and other

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 form owing non-financial

companies. In Japan banks are usually the nexus of a cross-share holding entity known

as the keirestu in France 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 existence is Monte dei paschi di siena headquartered in siena, Italy

which has been operating continuously since 1472

1.1. Origin Of The Word Bank

The name bank derives from the Italian word banco "desk/bench", used during the

Reaissancc 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 times ancient, which indicates that the word 'bank' might not necessarily come from

the word 'banco'.

M.S. Ramaiah College of Arts, Science and Commerce Page 1


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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 arederived. 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. 350-325

BC, presented in the British museum in London. The coin shows a banker's table laden

with coins, a pun on the name of the city

1.1.1. Traditional bank practices

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 consideredan 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



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funds, cash management trusts and other non-bank financial institutions in many cases

provide an adequate substitute to banks for lending savings to

1.2. Role of banking

Commercial Role

The commercial role of banks is not limited to banking, and includes:

issue of banknotes issued by a banker and payable to bearer on demand)

processing of payments by way of telegraphic transfer, internet banking or other

means

issuing bank drafts and bank cheques

accepting money on term deposit

lending money by way of overdraft, installment loan or otherwise

providing documentary and standby tetters of credit (trade finance),

guarantees, performance bonds, securities underwriting commitments and other

forms of off-balance sheet exposures

safekeeping of documents and other items in safe deposit boxes

currency exchange

acting as a 'financial supermarket' for the sale, distribution or brokerage, with or

without advice, of insurance, unit trusts and similar financial products

1.1. Economic Function

The economic functions of banks include

1. 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 anjj/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.

2. 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



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enables banks to economise on reserves held for settlement ot payments, since

inward and outward payments offset each other. II also enables the offsetting of

payment tlows between geographical areas, reducing the cost of settlementbetween them.

3. Credit intermediation - banks borrow and lend back-to-back on their own account

as middle men.

4. 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 raise the funding it needs to continue to

operate, this puts the note holders and depositors in an economically

subordinated position.

5. 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).

1.4. 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.



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The law implies rights and obligations into this relationship as follows

1. The bank account balance is the financial position between the bank and thecustomer: 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.

2. 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.

3. The bank may not pay from the customer's account without a mandate from the

customer, e.g. a cheque drawn by the customer.

4. 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.

5. The bank has a right to combine the customer's accounts, since each account is

just an aspect of the same credit relationship.

6. The bank has a lien on cheques deposited to the customer's account, to the

extent that the customer is indebted to the bank.

7. The bank must not disclose details of transactions through the customer's

account unless the customer consents, there is a public duty to disclose, the

bank's interests require it, or the law demands it.8. 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



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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:

1. Minimum capital

2. Minimum capital ratio

3. 'Fit and Proper* requirements for the bank's controllers, owners, directors, and/or

senior officers

4. Approval of the bank's business plan as being sufficiently prudent and plausible.

1.5. BANKING CHANNELS

Banks offer many different channels to access their banking and other services:

A branch, banking centre or financial centre is a retail location where a bank or

financial institution offers a wide array of face-to-face service to its customers.

ATM is a computerised telecommunications device that provides a financial

institution's customers a method of financial transactions in a public space

without the need for a human clerk or bank teller. Most banks now have more

ATMs than branches, and ATMs are providing a wider range of services to a

wider range of users. For example in Hong Kong, most ATMs enable anyone to

deposit cash to any customer of the bank's account by feeding in the notes andentering the account number to be credited. Also, most ATMs enable card

holders from other banks to get their account balance and withdraw cash, even if

the card is issued by a foreign bank.



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Mail is part of the postal system which itself is a system wherein written

documents typically enclosed in envelopes, and also small packages containing

other matter, are delivered to destinations around the world. This can be used todeposit cheques and to send orders to the bank to pay money to third parties.

Banks also normally use mail to deliver periodic account statements to

customers.

Telephone banking is a service provided by a financial institution which allows its

customers to perform transactions over the telephone. This normally includes bill

payments for bills from major billers (e.g. for electricity).

Online banking is a term used for performing transactions, payments etc. over

the Internet through a bank, credit union or building society's secure website.

Mobile banking is a method of using one's mobile phone to conduct simple

banking transactions by remotely linking into a banking network.

Video banking Is a term used for performing banking transactions or professional

banking consultations via a remote video and audio connection. Video banking

can be performed via purpose built banking transaction machines (similar to an

Automated teller machine), or via a videoconference enabled bank branch.

1.6. Types Of Bank

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 wealthmanagement 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.



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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 lastresort in event of a crisis.

1.6.1. Types of retail banks.

Atm Al Rajhi Bank



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National Cupper Bank. Salt Lake City 1911

National Bank of the Republic, Salt Lake City, 1908



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Commercial bank

The term used for a normal bank to distinguish it trom an investment bank. After theGreat 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

Llocally 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 banksBanks 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



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Infrastructure. Nowadays, European savings banks have kept their focus

on retail banking

Payments, savings products, credits and insurances for individuals or small andmedium 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 l.anriesbanks

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 banksBanks that transact according to Islamic principles.

1.6.2. 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.

1.6.3. Both combined



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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 and fees on the financing facilities that it extends to

customers.

1.7. Bank Of Economy

1.7.1. Size of global banking industry

Assets of the largest 1,000 banks in the world grew by 6.8% in the 2008/2009 financial

year to a record $96.4 trillion while profits declined by 85% to $115bn. Growth in assets

in adverse market conditions was largely a result of recapitalisation. EU banks held the

largest share of the total, 56% in 2008/2009. down from 61% in the previous year. Asian

banks' share increased from 12% to 14% during the year, while the share of US banks

increased from 11% to 13%. Fee revenue generated by global investment banking

totalled S66.3bn in 2009, up 12% on the previous year. The United States has the most

banks in the world in terms of institutions (7,085 at the end of 2008) and possibly

branches (82,000 This is an indicator of the geography and regulatory structure of the

USA, resulting in a large number of small to medium-sized institutions in its banking

system. As of Nov 2009, China's top 4 banks have in excess of 67,000 branches(ICBC:18000+, BOC:12000+,CCB:13000+,ABC:24000+) with an additional 140 smaller

banks with an undetermined number of branches. Japan had 129 banks and 12,000

branches. In 2004, Germany, France, and Italy each had more than 30,000 branches

more than double the 15,000 branches in the UK.



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Financial sector reforms were initiated as part of overall economic reforms in the

country and wide ranging reforms covering industry, trade, taxation, external sector,

banking and financial markets have been carried out since mid 1991. A decade ofeconomic and financial sector reforms has strengthened the fundamentals of the Indian

economy and transformed the operating environment for banks and financial institutions

in the country. The sustained and gradual pace of reforms has helped avoid any crisis

and has actually fuelled growth. As pointed out in the RBI Annual Report 2001-02, GDP

growth in the 10 years after reforms i.e. 1992-93 to 2001-02 averaged 6.0% against

5.8% recorded during 1980-81 to 1989-90 in the pre-reform period. The most significant

achievement of the financial sector reforms has been the marked improvement in the

financial health of commercial banks in terms of capita! adequacy, profitability and asset

quality as also greater attention to risk management. Further, deregulation has opened

up new opportunities for banks to increase revenues by diversifying into investment

banking, insurance, credit cards, depository services, mortgage financing, securitization,

etc. At the same time, liberalization has brought greater competition among banks, both

domestic and foreign, as well as competition from mutual funds. NBFCs, post office, etc.

Post-WTO, competition will only get intensified, as large global players emerge on the

scene. Increasing competition is squeezing profitability and forcing banks to work

efficiently on shrinking spreads. Positive fallout of competition is the greater choice

available to consumers, and the increased level of sophistication and technology in

banks. As banks benchmark themselves against global standards, there has been a

marked increase in disclosures and transparency in bank balance sheets as also

greater focus on corporate governance.

1.8. Industrial Profile

1.8.1. Origin And Development Of The Industry



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ING Vysya Bank Ltd.. is an entity formed with the coming together of erstwhile, Vysya

Bank Ltd, a premier bank in the Indian Private Sector and a global financial

powerhouse, ING of Dutch origin, during Oct 2002.

The origin of the erstwhile Vysya Bank was pretty humble. It was in the year 1930 that a

team of visionaries came together to form a bank that would extend a helping hand to

those who weren't privileged enough to enjoy banking services. It's been a long journey

since then and the Bank has grown in size and stature to encompass every area of

present-day banking activity and has carved a distinct identity of being India's Premier

Private Sector Bank.

In 1980. the Bank completed fifty years of service to the nation and post 1985; the Bank

made rapid strides to reach the coveted position of being the number one private sector

bank. In 1990. the bank completed its Diamond Jubilee year. At the Diamond Jubilee

Celebrations, the then Finance Minister Prof. Madhu Dandavate, had termed the

performance of the bank "Stupendous'. The 75th anniversary, the Platinum Jubilee of

the bank was celebrated during 2005. The long journey of seventy-five years has had

several milestones.

1.8.2. Growth And Present Status Of The Industry

The financial sector is in a process of rapid transformation. Reforms are continuing as

part of the overall structural reforms aimed at improving the productivity and efficiency

of the economy. The role of an integrated financial infrastructure is to stimulate and

sustain economic growth.

The USS 28 billion Indian financial sector has grown at around 15 per cent and hasdisplayed stability for the last several years, even when other markets in the Asian

region were facing a. crisis. This stability was ensured through the resilience that has

been built into the system over time. The financial sector has kept pace with the growing

needs of corporate and other borrowers. Banks, capital market participants and insurers

have developed a wide range of products and services to suit varied customer



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requirements. The Reserve Bank of India (RBI) has successfully introduced a regime

where interest rates are more in line with market forces.

Financial institutions have combated the reduction in interest rates and pressure on

their margins by constantly innovating and targeting attractive consumer segments.

Banks and trade financiers have also played an important role in promoting foreign

trade of the country.

1.9. Banks

The Indian banking system has a large geographic and functional coverage. Presently

the total asset size of the Indian banking sector is USS 270 billion while the total

deposits amount to USS 220 billion with a branch network exceeding 66,000 branches

across the country. Revenues of the banking sector have grown at 6 per cent CAGR

over the past few years to reach a size of USS 15 billion. While commercial banks cater

to short and medium term financing requirements, national level and state level financial

institutions meet longer-term requirements. This distinction is getting blurred with

commercial banks extending project finance. The total disbursements of the financial

institutions in 2001 were USS 14 billion.

Banking today has transformed into a technology intensive and customer friendly model

with a focus on convenience. The sector is set to witness the emergence of financial

supermarkets in the form of universal banks providing a suite of services from retail to

corporate banking and industrial lending to investment banking. While corporate

banking is clearly the largest segment, personal financial services is the highest growth

segment.

The recent favorable government policies for enhancing limits of foreign investments to

49 per cent among other key initiatives have encouraged such activity. Larger banks will

be able to mobilize sufficient capital to finance asset expansion and fund investments in

technology.



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1.10. Capital Market

The Indian capital markets have witnessed a transformation over the last decade. India

is now placed among the mature markets of the world. Key progressive initiatives inrecent years include:

The depository and share dematerialization systems that have enhanced the

efficiency of the transaction cycle I Replacing the flexible, but often exploited,

forward trading mechanism with rolling settlement, to bring about transparency.

The InfoTech-driven National Stock Exchange (NSE) with a national presence

(for the benefit of investors across locations) and other initiatives to enhance the

quality of financial disclosures. A Corporatization of stock exchanges.

The Securities and Exchange Board of India (SEBI) has effectively been

functioning as an independent regulator with statutory powers. I Indian capital

markets have rewarded Foreign Institutional Investors (Flls) with attractive

valuations and increasing returns.

The Murnbai Stock Exchange continues to be the premier exchange in the

country with an increase in market capitalization from USS 40 billion in 1990-

1991 to USS 203 billion in 1999-2000. The stock exchange has about 6.000

listed companies and an average daily volume of about a billion dollars. Many

new instruments have been introduced in the markets, including index futures.

index options, derivatives and options and futures in select stocks.

1.11. Insurance

With the opening ol the market, foreign and private Indian players are keen to convert

untapped market potential into opportunities by providing tailor-made products:

The presence of a host of new players in the sector has resulted in a shift in

approach and the launch of innovative products, services and value-added



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benefits. Foreign majors have entered the country and announced joint ventures

in both life and non-life areas. Major foreign players include New York Life. Aviva.

Tokio Marine, Allianz, Standard Life. Lombard General. AIG, AMP and Sun Lifeamong others.

With competition, the erstwhile state sector companies have become aggressive

in terms of product offerings, marketing and distribution.

The Insurance Regulatory and Development Authority (IRDA) has played a

proactive role as a regulator and a facilitator in the sector's development.

The size of the market presents immense opportunities to new players with only

20 per cent of the country's insurable population currently insured.

The state sector Life Insurance Corporation (LIC>, the largest life insurer in 2000,

sold close to 20 million new policies with a turnover of USS 5 billion

The gross premium for the insurance sector was USS 13 billion for 2001-02.

There are four public sector and nine private sector insurance companies

operating in general/non-life insurance business with a premium income of over

USS 2.58 billion.

The market's potential has been estimated to have a premium income of USS 80

billion with a potential size of over 300 million people. The General Insurance

Corporation (GIC) (which covers the non-life sector) had a total premium incomeof USS 2 billion in 2001-02 This has the potential to reach USS 9 billion in the

next five years.

1.12. Venture Capital



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Technology and knowledge have been and continue (o drive the global economy. Given

the inherent strength by way of its human capital, technical skills, cost competitive

workforce, research and entrepreneurship, India is positioned for rapid economic growthin a sustainable manner. To realize the potential, there is a need for risk tinance and

venture capital (VC) funding to leverage innovation, promote technology and harness

knowledge based ideas.

The Indian venture capital sector has been active despite facing a challenging

external environment in 2001 and a competitive market scenario.

There were 34 VCFs and 2 Foreign VCFs registered with SEBI in March 2002. A-

According to a survey conducted by Thomson Financial and Prime Database,

India ranked as the third most active venture capital market in Asia Pacific

(excluding Japan).

It recorded 115 deals in 2001 with average investment per deal amounting to

USS 7.9 million. 57 VCFs invested USS 908 million in 101 Indian companies

during 2001. 4 Disbursements for 2002 are expected to be USS 2 billion and are

estimated to reach USS 10 billion by 2007.

A. There is an increased interest in India: 70 VC funds operate in India with the

total assets under management worth about US$ 6 billion.

The amount has grown nearly twenty fold in the past five years. Most VCs

believe that 2002-03 will be driven by a relatively stable economy and new

initiatives that will boost the e-commerce sector, particularly on-line trading ande-banking sectors.

1.12. Future Of The Industry

The interplay between policy and regulatory interventions and management strategies

will determine the performance of Indian banking over the next few years. Legislative



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actions will shape the regulatory stance through six key elements; industry structure and

sector consolidation; freedom to deploy capital; regulatory coverage; corporate

governance; labor reforms and human capital development; and support for creatingindustry utilities and service bureaus. Management success will be determined on three

fronts: fundamentally upgrading organizational capability to stay in tune with the

changing market: adopting value-creating MSA as an avenue for growth; and

continually innovating to develop new business models to access untapped

opportunities. Through these scenarios, we paint a picture of the events and outcomes

that will be the consequence of the actions uf policy makers and bank managements.

These actions will have dramatically different outcomes: the costs of inaction or

insufficient action will he high. Specifically, at one extreme, the sector could account for

over 7.7 per cent of GDP with over Ks. /,5QQ billion in market cap while at the other it

could account for just 3.3 per cent of GDP with a market cap of Rs. 2.400 billion.

Banking sector intermediation, as measured by total loans as a percentage of GDP.

could grow marginally from its current levels of -30 per cent to -45 per cent or grow

significantly to over 100 per cent of GDP. In all of Ihis, the sector could generate

employment to the tunc of 1.5 million compared to 0.9 million today. Availability of

capital would be a key factor the banking sector will require as much as Rs. 600

billion {USS 14 billion), in capital to fund growth in advances, non-performing loan (NPL)

write offs and investments in II and human capital up gradation to reach the high-

performing scenario.

Three scenarios con be defined to characterize these outcomes:

1.13. High Performance

In this scenario, policy makers intervene only to the extent required to ensure systemstability and protection of consumer interests, leaving managements free to drive far-

reaching changes. Changes in regulations and bank capabilities reduce intermediation

costs leading to increased growth, innovation and productivity. Banking becomes an

even greater driver of GDP growth and employment and large sections of the population

gain access to quality banking products. Management is able to overhaul bank



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organizational stnictures, focus on industry consolidation and transform the banks into

industry shapers. In this scenario we witness consolidation within public sector banks

(PSBs) and within private sector banks. Foreign banks begin to be active in MSA,buying out some old private and newer private banks. Some M&A activity also begins to

take place between private and public sector banks. As a result, foreign and new private

banks grow at rates of 50 per cent, while PSBs improve their growth rate to 15 per cent.

The share of the private sector banks (including through mergers with PSBs) increases

to 35 per cent and that of foreign hanks increases to 20 per cent of total sector assets.

The shares of banking sector value add in GDP increases to over 7 7 per cent, from

current levels of 2.5 per cent. Funding this dramatic growth will require as much as Rs.

GOO billion in capital over the next few years.

1.14. Stagnation

In this scenario, policy makers intervene to set restrictive conditions and management is

unable to execute the changes needed to enhance returns to shareholders and provide

quality products and services to customers. As a result, growth and productivity levels

are low and the banking sector is unable to support a fast-growing economy. This

scenario sees limited consolidation in the sector and most banks remain sub-scale. New

private sector banks continue on their growth trajectory of 25 per cent. There is a

slowdown in PSB and old private sector bank growth. The share of foreign banks

remains at 7 per cent of total assets. Banking sector value add, meanwhile, is only 3.3

per cent of GDP.



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CHAPTER - 2

RESEARCH DESIGN

2.1. Statement Of The Research Problem

In today's era of challenging competition, it is of an uttermost importance to gain a

cutting edgo over the competition, and develop a large market share. This is only

possible if there is a largo customer base for the company. The company must gain

confidence of the customers and provide services par excellence.

Every banking organization needs to maximize its customer base and to retain it. The present study is to find out the different and possible methods to attract the

customers towards the organization.

The study also focuses on the challenges being posed by different hanking sectors.

Therefore, undertaking the project helps in assessing the customer care lovol of ING

VYSYA BANK. The study is applied descriptive as well as diagnostic in nature. It also

tends to find the customer view about important aspects of the services. At tho same

time it was intended to find the customer view about the product and the quality of

service improvement. In short this problem can be defined as:

Are Customer satisfy with the service at ING VySya Bank?

2.2. Scope Of Study

As the competition level in the banking sector is ever increasing, it becomes

indispensable for the company (ING VYSYA BANK) to conduct the study on the

perception and satisfaction level of its customers. This study will help the company in

making its new strategies to satisfy its customer in the ways in which he or she wants to

be satisfied and to the company its position in the market.



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The study on customer satisfaction has the geographical coverage limited to K.H. Road

only. This study will help the company to know in detail about the customer perception

and their attitude towards the company services and products. The company will gainthe feedback from the customer to improve its products and quality of service.

2.3. Statement Of Research Objectives

To evaluate the perception level of the customer.

To study the importance of customer management in bank sector service .

To analyze the expectations of bank customers.

To analyze the satisfaction level of customers of ING VYSYA BANK on the

following heads

Working environment

Customer care

Personal care of the customers

Bank timings

Overall services

Special schemes provided

To realize what are the requisites of the customers and how to go about

improving the quality of services.

2.4. Research Design And Methodology

Importance Of Service

Services are activities or benefits that one party offer to another that are essentially

intangible, inseparable, variable, perishable and do not result in ownership of anything.

Service sector dominates the Indian economy today, contributing more than half of our

national income.

Importance Of Banking

Banking can be defined as accepting for the purpose of lending or investment of

deposits from the public, repayable on demand or otherwise and withdraw able by

cheque, draft, and orders or otherwise. Banks are playing a crucial role in the economic



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development of the country. Banking industry regulates mobilization and supply of

capital to trade and development.

Importance Of Customer Relationship Management

The aim of CRM is to produce high customer equity. Customer equity is the total of the

discounted lifetime values of all the firm's customers. The taste of creating strong

customer loyalty is called customer relationship management.

2.5. Measuring Customer Satisfaction In The Banking Industry

2.5.1. Introduction

Banking operations are becoming increasingly customer dictated. The demand for

'banking supermalls' offering one-stop integrated financial services is well on the rise.

The ability of banks to offer clients access to several markets for different classes of

financial instruments has become a valuable competitive edge. Convergence in the

industry to cater to the changing demographic expectations is now more than evident.

Bancassurance and other forms of cross selling and strategic alliances will soon alter

the business dynamics of banks and fuel the process of consolidation for increased

scope of business and revenue. The thrust on farm sector, health sector and services

offers several investment linkages. In short, the domestic economy is an increasing pie

which offers extensive economies of scale that only large banks will be in a position to

tap. With the phenomenal increase in the country's population and the increased

demand for banking services; speed, service quality and customer satisfaction are

going to be key differentiators for each bank's future success. Thus it is imperative for

banks to get useful feedback on their actual response time and customer service quality

aspects of retail banking, which in turn will help them take positive steps to maintain a

competitive edge.

The working of the customer's mind is a mystery which is difficult to solve and

understanding the nuances of what customer satisfaction is, a challenging task. This

exercise in the context of the banking industry will give us an insight into the parameters

of customer satisfaction and their measurement. This vital information will help us to



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build satisfaction amongst the customers and customer loyalty in the long run which is

an integral part of any business. The customer's requirements must be translated and

quantified into measurable targets. This provides an easy way to monitor improvements,and deciding upon the attributes that need to be concentrated on in order to improve

customer satisfaction. We can recognize where we need to make changes to create

improvements and determine if these changes, after implemented, have led to

increased customer satisfaction. "If you cannot measure it, you cannot improve it." -Lord

William Thomson Kelvin (1824-1907).

2.6. The Need to Measure Customer Satisfaction

Satisfied customers are central to optimal performance and financial returns. In many

places in the world, business organizations have been elevating the role of the

customer to that of a key stakeholder over the past twenty years. Customers are viewed

as a group whose satisfaction with the enterprise must be incorporated in strategic

planning efforts. Forward-looking companies are finding value in directly measuring and

tracking customer satisfaction (CS) as an important strategic success indicator.

Evidence is mounting that placing a high priority on CS is critical to improved

organizational performance in a global marketplace.

With better understanding of customers' perceptions, companies can determine the

actions required to meet the customers' needs. They can identify their own strengths

and weaknesses, where they stand in comparison to their competitors, chart out path

future progress and improvement. Customer satisfaction measurement helps to

promote an increased focus on customer outcomes and stimulate improvements in the

work practices and processes used within the company.

When buyers are powerful, the health and strength of the company's relationship with its

customers - its most critical economic asset - is its best predictor of the future. Assets

on the balance sheet - basically assets of production - are good predictors only when

buyers are weak. So it is no wonder that the relationship between those assets and



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future income is becoming more and more tenuous. As buyers become empowered,

sellers have no choice but to adapt. Focusing on competition has its place, but with

buyer power on the rise, it is more important to pay attention to the customer.

Customer satisfaction is quite a complex issue and there is a lot of debate and

confusion about what exactly is required and how to go about it. This article is an

attempt to review the necessary requirements, and discuss the steps that need to be

taken in order to measure and track customer satisfaction.

2.7. What constitutes Satisfaction?

The meaning of satisfaction: "Satisfied" has a range of meanings to individuals, but it

generally seems to be a positive assessment of the service.

The word "satisfied" itself had a number of different meanings for respondents! which

can be split into the broad themes of contentment/happiness, relief, achieving aims,

achieving aims and happy with outcome and the fact that they did not encounter any

hassle:

2.7.1. Happy

Content

Happy, pretty happy, quite happy

Pleased

Walked out of there feeling good

Walk out of there chuffed

Grateful the service has been OK

2.7.2. Relieved

Thank God for that

Phew

At ease

Can relax



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Stress reduction

Secure -Safe

Go to the bank with a troubled mind and they sort it out for you

Sleep at night without worrying what's going to go on

Everything is sorted out in your mind and you're happy

Secure, you know the money has been sorted out

Knowing the money's going to be there

2.7.3. Achieving aims

Achieving your aim or goal

Getting what you went in /or

Achieve whatever it is you wanted to achieve

Come away with a proportion of what you want

Got what wanted in the end

Got what you went down for

Everything went according to plan, the way it should have done

Met expectations

To be unsatisfied is when you come out and you are still on the same level as

you were before

2.7.4. Achieving aims, and happy with outcome

Happy with the results

Happy with what you've got

When you walk out you're happy they've sorted everything out and quickly

Happy with outcome

Pleased with what's happened Content with what's been done for you

A feeling of happiness having achieved your goal

You go in there feeling down and the only v/ay you arc going to come out

satisfied is if they have been good to you



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2.7.5. No hassle

Not frustrated

Everything goes smooth

No hassle

No problems

No hasslo getting there

Straightforward

Clearly then there is some variation in understanding of the term. Some of the

interpretations fit with the definitions used in much of the service quality and satisfaction

literature, where satisfaction is viewed as a zero state, merely an assessment that the

service is adequate, as opposed to "delight" which reflects a service that exceeds

expectations. However, most respondents have more positive interpretations of the

term. These questions allow us to identify priorities for improvement by comparing

satisfaction with stated (overt) importance, comparing satisfaction with modeled (covert)

importance (from identifying key drivers of overall satisfaction), as well as respondents'

own stated priorities.

2.8. Service Quality and Customer Satisfaction

There is a great deal of discussion and disagreement in the literature about the

distinction between service quality and satisfaction. The service quality school view

satisfaction as an antecedent of service quality - satisfaction with a number of individual

transactions "decay" into an overall attitude towards service quality. The satisfaction

school holds the opposite view that assessments of service quality lead to an overall

attitude towards the service that they call satisfaction. There is obviously a strong link

between customer satisfaction and customer retention. Customer's perception ofService and Quality of product will determine the success of the product or service in

the market.

If experience of tho service greatly exceeds the expectations clients had of the service

then satisfaction will be high, and vice versa.. In the service quality literature,



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perceptions of service delivery are measured separately from customer expectations,

and the gap between the two provides a measure of service quality.

2.9. Expectations and Customer Satisfaction

Expectations have a central rolo in influencing satisfaction with services, and these in

turn are determined by a very wide range of factors lower expectations will result in

higher satisfaction ratings for any given level of service quality. This would seem

sensible; for example, poor previous experience with the service or other similar

services is likely to result in it being easier to pleasantly surprise customers. However,

there are clearly circumstances where negative preconceptions of a service provider will

lead to lower expectations, but will also make it harder to achieve high satisfaction

ratings - and where positive preconceptions and high expectations make positive ratings

more likely. The expectations theory in much of the literature therefore sooms to be an

over-simplification.

SpecialRequirementOf Customer

Customer Customer Property Focus


CUSTOMERSATISFACTION


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Customer Customer Feed Back Grievances

TimelySupply

2.9.1. Sampling

The Random sampling method, to select a sample of 100 customers of the ING VYSYA

BANK, JAYANAGAR Branch.

2.10. The Methods Used For Data Collection Are

Primary Data

Secondary Data

2.10.1. Primary Data

Primary data are data's, which are original in nature, and are collected by the

researcher. The method used to collect the primary data was Survey Method. The

survey method included a structured questionnaire that was given to the respondent.

2.10.2. Secondary Data

Secondary data are data, which has been collected and compiled in advance for

another needed purpose. Secondary data is an important method to know the present

problem faced by the account holders in the field of ING VYSYA BANK.

2.11. Plan Of Analysis

Calculations have been done for interpretation such as percentages, averages

etc.



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This data has been analyzed with the help of tables, graphs and charts obtained

from questionnaires.

The data collected from respondents through questionnaire are organized,

coded, processed and tabulated in order to create graphs and charts to make the

project understandable.-

2.12 Tools For Data Collection

The tool used for data collection is Primarily "Questionnaire method". The questions

contained:

2.12.1. Open Ended Questions

Where the respondent was given a chance to reply or give suggestions to the company.

This included Free Responses questions where the respondents were given the

freedom to give suggestions.

2.12.2. Close Ended Questions

Where the respondent was given a lesser chance to reply. This includes Multiple Choice

Questions where the respondents were given a number of alternatives. Scales

Respondents were given a scale whose positions range from "Highly Satisfied" to

"Highly Dissatisfied' area of survey. The area selected to find the satisfactory level was

in and around Kasturba Road.

2.12.3. Area of survey

The areas selected to find the satisfaction level were mostly big shops, showrooms,

restaurants, hotels, companies, etc. along with JAYANAGAR, J.P NAGAR, LAL BAGH,WILSON GARDEN ROAD, K.R ROAD, K.H. ROAD etc. those were nearby ING VYSYA

Bank JAYANAGAR Branch.

2.12.4. Sample Size

Samples sizes of 100 customers are taken from the area of survey.



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2.12.5. Sample Unit

The sample was considered to be the Customers of ING VYSYA BANK

2.12.6. Sample Method

Non - profitability sampling i.e. convenient sampling method

2.13. Limitations Of The Study

The study was at the maximum extent restricted for the JAYA NAGAR Branch

only however area of survey was wider.

Since the study is based on primary data collected, any bias in the sources of the

data collected would have affected the outcome.

Since the study conducted comparatively on a small-scale sample, the outcome

may not be generalized.

As the study is only conducted in ING VYSYA BANK in a selected branch in

Bangalore, the out come of the study cannot be generalized for 'ING VYSYA

BANK'.

This being an academic study suffers from time and cost constraints.

2.14. Students Work Profile Roles

2.14.1. Role

The role of the trainee was that of a sales executive. The major duties of the trainee

were to ensure the selling of current account to the Pvt. Ltd and Public Ltd. companies,

hotels, transporter, shopkeepers, trust, and manufactures. Also the role of trainee was

to explain the features of four different type of current account to customers and collect

and verify the relevant documents from the interested customers, after verification of the

documents, trainee was supposed to logging and dispatch of application forms along

this the trainee was supposed to give answers of queries of the customers.



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2.14.2. Responsibilities

The major responsibilities handled were: Opening of current accounts of various types of new as well as existing

customers.

Verifying the application forms and documents required for the opening of

account,

Processing and then logging of the application forms for account activation,

Answering to the customer queries and generating awareness about the various

new

features of the products.

Preparing of weekly management information system report as well as the

compilation

of database.

Preparing of customer feedback report about the services provided by ING

VYSYA BANK.

2.15. Description Of Live Experiences

When I started my work in IMG VYSYA BANK, it was very interesting and was helping

me to know about banking and customer's perception about ING VYSYA Bank. But after

one month it became challenging and tough for me, because it was not only the account

opening operations but also I had some difficult targets to achieve. My mentor had a lot

of expectations from me. On joining here after completing my 2nd semester. I had to

adjust to the environment very quickly as situations were very demanding, but it wasexciting for me because it was the only place where I thought. I can prove myself.

My working period started with training in ING VYSYA Bank's Training office at J AY AN

AGAR, after that I got placed at KORMANGALA Branch as a Senior Sales Executive.

There was some stiff competition. Therefore our first and foremost priority was to attract



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customer to ING VYSYA Bank. Rigorous tele-calling and field work helped me to

convince customers.

After one month our performance was evaluated and our manager told us to improve.

Selling these products was an up hill task, but still we had to fulfill our target for every

month. Every month target for us is 10 accounts. After finishing up with the daily

appointments and commitments we had to report to the branch regarding daily

performance. We pitched the features of current accounts to customers who were

having either current account with any other bank or not having any current account (in

case of newly started business).



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CHAPTER - 3

COMPANY PROFILE

3.1. Origin Of The Organization

In India, ING is present in all three fields of banking, insurance and asset management

in the form of ING. ING Vysya Life Insurance and ING Investment Management

respectively. The presence in all three fields signifies the importance that the group

attaches to the Indian markets and the group's operations here, as well as its bullish

future outlook on the country. ING and ING Vysya Life Insurance are headquartered at

Bangalore, while the corporate office of ING Investment Management is situated at

Mumbai. The synergies arising out of the three distinct but complimentary businesses

are bound to be an asset to the group in the changing market dynamics of the future.

The first such signs are already visible on the horizon with combined products being

successfully launched by the different entities of the group in conjunction with each

other.

3.2. Growth And Development Of The Organization

ING VYSYA BANK Ltd. provides its 1.5 million customers with a variety of full-serviceretail banking products including deposits and loans, mutual funds, investments, debit

cards and credit cards. ING Vysya also provides credit services, cash management

services, foreign exchange and foreign trade services along with treasury, investment

and wealth management services.

3.2.1. Global Expertise

Although Profile has multicurrency and multilingual capabilities, some country specific

customization was required including recurring deposits, cash credits and overdrafts,

clearing, remittances, time deposit savings and statutory reporting. Upon full completion

of the rollout, ING Vysya will have centralized information and the ability to offer

integrated banking services across several delivery channels on a 24x7 basis

throughout India. The experience Fidelity has gained from Project Amula will



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undoubtedly help additional Indian banks that seek to migrate legacy systems to an

updated, modern architecture

3.2.2. Reduced Time To Market

The need for innovative new products and compatibility with modern delivery channels

was a compelling force behind ING Vysya's decision to install Profile. The ING Vysya

team decided to start with a core banking solution as a platform on which products and

services could be deployed quickly. Profile's electronic product manufactunng capability

was attractive to the bank because it reduced time-to market for new products. In the

future. ING Vysya plans to expand its product offerings into northern India through

ATMs and the Internet. Using Profile, the new banking platform supports current

accounts, monthly minimum low-balance savings accounts, fixed deposit accounts and

two new products - overdraft cash credit accounts and cumulative deposit accounts.

3.2.3. Increased Efficiency

At the heart of the Profile system is a database engine that provides efficient message

formatting. For ING Vysya, this translates to reduced bandwidth requirements and little

system overhead. This saves the bank on hardware configuration costs and decreases

end of day processing time. Before Profile was installed, the bank's processing time

depended on the size of the branch and them systems in the branch. In addition, the

system was decentralized and therefore relied on trial balances that were forwarded

every two weeks. With Profile in place, ING Vysya branches now have financial by the

next morning. In addition, end of day processing is now accomplished in only 90

minutes

The data center in Bangalore is connected to 12 distribution points through two Mbpsleased lines with ISDN back-up and Cisco 7500 routers. Each distribution point is, in

turn connected to its group of branches through 64Kbps leased lines with ISDN/PSTN

back-up. The data recovery center is located in Hyderabad and is connected to a data

center in Bangalore on 2X4Mbps leased lines as well as to all distribution points. Data



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replication between the main data center and the disaster recovery center occurs twice,

daily.

3.2.4. Opportunies For Rowth

India offers substantial growth opportunities for ING, driven by a strong economy,

favorable demographics and an increasing openness to international firms. The

economic outlook is excellent, with annual GDP growth forecasts at 8%-9% in the

coming years (graph 1). In addition, India has a growing consumer class, largely under

the age of 30, which is characterized by a rising income and a reduced aversion to debt.

Importantly, India has the fastest real growth rate of credit to the private sector in Asia,

indicating a rapid financial deepening (see graph-2).

3.2.5. Geography

Although more concentrated in affluent, southern India. ING Vysya has more than 480

branches located throughout the country including metro, urban, semi-urban and rural

centers spread over 15 states of India.

3.2.6. Growing Revenues

ING VYSYA deployed Profile as part of an aggressive business plan to modernize the

banks retail and corporate banking operations in south India. The bank expects to

achieve a percent rise of 300 in revenues from treasury operations as a result of timely

information from the new. centralized architecture

3.2.7. Increased Automation

At the beginning of 2000, ING Vysya was still performing partial or fully manual

processing in over half its branches. With the installation of Profile, the bank reducedthe amount of staffing required to process transactions by15 percent.

ING has established strong positions in developing markets, largely built on organic

greenfield operations and strategic acquisitions that together provide excellent long-

term growth potential. India is one of these markets and ING is the only foreign bank in



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the country with a substantial stake in a local bank, ING VYSYA. Active in retail and

wholesale banking, life insurance and asset management. ING VYSYA aims to achieve

organic growth through capturing share in this fast growing market by providingexcellent customer service and by focusing on target segments and core products. The

Self Bank concept perfectly fits within this strategy and provides ING VYSYA with a

unique platform for future growth.

3.3. Present Status Of The Organization

Company Profile: ING VYSYA Bank Limited

Ticker: 531807

Exchanges: OTH BOM

2010 Sales: 21,035,000,000

Major Industry: Financial

Sub Industry: Commercial Ranks

Country: INDIA

Employees: 9,850

3.3.1. Business Description

ING VYSYA Bank Limited. The Group's principal activity is to provide banking services

in India. The banking services of the Group include retail banking, corporate banking,

commercial banking, treasury management and rural banking. The Group also offers

dematertalization and other financial services. Other financial services include housing

finance, insurance products, mutual funds etc. The Group operates through 446 branch

offices including 39 extension counters and 203 ATMs in India

3.4. Functional Departments Of The Organization



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The bank has three key business areas:

3.4.1. Wholesale Banking ServicesHere our target market is primarily large, blue-chip companies and to a lesser extent,

emerging mid-sized corporate. For these corporate, we provide a wide range of

services, including working capital finance, trade services, transactional services, cash

management, etc. We are a lending provider of structured solutions, which combine

cash management services with vendor and distributor finance, for facilitating superior

supply chain management for our corporate customers. We are also recognized as a

leading provider of cash management and transactional banking solutions to mutual

funds, stock exchange members and banks.

3.4.2. Retail Banking Services

The objective of the Retail Bank is to provide our 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 the customers through the growing branch network, as well as through

alternative delivery channels like ATMs. Phone Banking. Net Banking 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. We have a wide array of retail loan products

including Auto Loans, Loans against Securities, Personal Loans and Loans for Two-

wheelers. We are also a leading provider of Depository Services to retail D M NA

customers. Further we are one of the leading players in the "merchant acquiring"

business with a large number of Point-of-sale (POS) terminals for debit / credit cardsacceptance at merchant establishments.

3.4.3. Treasury Operations

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



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a) Foreign Exchange and Derivatives,

b) Local Currency Money Market &

c) Debt Securities and Equities.

With the liberalization of the financial markets in India, corporate need more

sophisticated risk management information, advice and product structures. These are

provided through the bank's Treasury team. The Treasury business is responsible for

managing the returns and market risk on the bank's investment portfolio.

3.5. Organization Structure And Chart

The Organizational Structure

ING VYSYA BANK Board of Directors comprises of eminent individuals with a wealth of

experience in public policy, administration, industry and commercial banking. Senior

executives M.S.RAMA IAH COLLEGE OF ARTS, SCIENCE & COMMERCE

representing HDFC are also on the Board. Senior banking professionals with substantial

experience In India and abroad head various business 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.

With the liberalization of the financial markets in India, corporate need more

sophisticated risk management information, advice and product structures. These are

provided through the bank's Treasury team. The Treasury business is responsible for

managing the returns and market risk on the bank's investment portfolio.

The following groups support the above business groups:

Audit & Compliance

Credit & Market Risk



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Finance, Administration & Legal

Human Resources

Information Technology

Operations

3.6. Systems & Technology

The Bank uses state-of-the-art technology for both internal and external customers.

3.6.1. Banking Applications

In terms of software, the Corporate Banking business is supported by UBS, while the

Retail Banking business by Finware. These world-class systems have been specially

customized for HDFC Bank by i-tlex Solutions Ltd. which is a Citigroup company. The

Bank also uses various other systems to support other infrastructure -

These systems are open, scalable and web-enabled.

3.6.2. Lotus Notes

Lotus Notes is the system that HDFC bank uses for internal communication.

3.6.3. Facilities Management

Wipro is the company appointed to give HDFC Bank the on-site support required at

different locations / cities.

Our website is: wwwJngvysvabank.com

Surfing through the site map put up on the bank's web-site would give a good idea on

the range of products and services offered by the bank. Amongst others, the site listspast financial results of the bank, awards and accolades won by the Bank. Etc.

ORGANIZATION CHART


Chairman
http://wwwjngvysvabank.com/http://wwwjngvysvabank.com/


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________________________________________

_________________________________________________________________________

3.7. Products and Services Profile of The Organization Competitors

Services and Product offered by the main competitors are as follows:

3.7.1. ICICI Bank's Corporate Salary Accounts


Managing Directorand CEO

Joint Managing Director

( Domestic Bankin )

Joint Managing

Director

Executive

Director

Executive

Director

Executive

Director

Executive

Director

Sr. General Manager

General Manager


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ICICI offers salary accounts to all the employees of the companies maintaining

an account with bank, with Average Quarterly Balance of Rs. Zero.

One can issue free DD & Pay Orders on any of the ICICI locations, though there

is a limit of Rs.25000 per day for such transactions.

Bank also provides each account holder with all the modern day banking facilities

such as Net, Phono. Mobile and ATM banking services. Bank provides ATM cum

International Debit Card.

Opening charges for a Dcmat a/c and a/c maintenance charges for the first yearare waived off for all corporate salary account holders.

ICICI bank offers a separate reimbursement a/c linked with salary account in

which employer can pay in all reimbursement such as travel, food and other petty

cash expenses to its employees. Separate annual statement is provided for the

account thereby helping the account holder in better tax planning.

ICICI provides its preferred saving a/c The ICICI Select to top three executives of

the company opting for the salary a/c offered by the bank.

Any balance over and above Rs.10000 (in multiples of Rs.5000) is transferred to

high interest rate earning FD a/c called Quantum Optima.

Citibank's Corporate Salary Accounts

Citibank offers Zero balance savings accounts to all the employees of the

companies maintaining an account with the bank.

It provides a/c holder with all the latest banking facilities such as Internet. Phone,

3.7.2. City Banks Corporate Salary Account

Bank provides ATM cum International Debit Card to all a/c holders*.



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The bank delivers DD at the mailing address for a charge within 24hrs. The DD

can be requested online or through phone.

Citibank has an alliance with New India Assurance to provide health insurance to

all the a/c holders with 50% discount on premiums.

One can avail an overdraft up to twice his salary, subject to maximum of

Rs.50000 at interest rate ot 2.33% per month.

Citibank provides no free Demat a/c service.

3.7.3. Standard Chartered Bank's Corporate Salary Account

Standard Chartered bank offers Zero balance account to all the employees of

any company that wants to maintain its corporate salary accounts.

The bank also provides each a/c holder with all the modern day facilities such as

Net, Phone, Mobile and ATM cum International Debit card to all the a/c holders.

Under a special offer scheme, the bank allows 4 free withdrawal per month, fro

any Visa ATM whereas other banks charge for the same

Those account holders, who maintain an Average Quarterly Balance of more

than Rs. 10000 over a period of time, are offered free credit cards.

3.7.4. UTI Bank's Corporate Salary Accounts

UTI offers salary account to all trie employees of the companies maintaining an

account with the bank.



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No minimum balance is required. That is the customers can open account with

zero balance.

One can issue free DD and pay orders on any of the UTI bank locations withoutany limit on the amount and number of transactions.

The bank does not install Cheque Drop box at any.of the companies.

The bank also provides each a/c holder with all the modern day facilities such as

Net, Phone, Mobile and ATM cum International Debit card to all the a/c holders

Bank provides each a/c holder with computerized Passbook.

Demat account-opening charges waived for all customers.

3.8 Market Profile Of The Organization

ING VYSYA Bank Limited. The Group's principal activity is to provide banking services

in India. The banking services of the Group include retail banking, corporate banking,

commercial banking, treasury management and rural banking. The Group also offers

dematerialization and other financial services. Other financial services include housing

finance, insurance products, mutual funds etc. the Group operates through 446 branch

offices including 39 extension counters and 203 ATMs in India



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3.8.1. Current Account Product

ORANGE CURRENT ACCOUNT

ADVANTAGE CURRENT ACCOUNT

COMFORT CURRENT ACCOUNT

GENERAL CURRENT ACCOUNT

3.8.2. Current Accounts

These accounls ate piiinaiily meant lo include a sense of transaction for the transaction

of business because you cannot do daily transaction through ^aviitfj account. It is

mandatory to have a current account for business.

General Current Account

Comfort Current Account

Advantage Current Account

Orange Current Account



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3.8.3. Savings Account

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

accumulating funds over a period of time. Whatever your occupation, we are confidentthat you will find the perfect banking solution. Open an account in your name or

register for one jointly with a family member today.

Orange Saving

Advantage Salary

Orange Salary

Solo

Saral

General

Freedom

ING Formula Savings Account

3.8.4. Term Deposit

Fixed Deposits

Cumulative Deposit

Akshnya

Tax Advantage Deposit

3.8.5. Demat Account

3.8.6. Loans

Personal Loan

Home Lone

Home Equity Loan NR1 Loan

Model Policy

3.8.7. Wealth Management



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Wealth Management Process

ING Positive Policy

Investment Products

3.8.9. NRI Services

3.8.10. Access Point

ATM Branch

Customer Service Line

Net Banking

Self Banking

SMS

3.8.11. Cards

Credit Cards

Debit Cards

Term & Conditions

Card Member Agreement

Fair Practice Code for Credit Card Operation

DAS's Code of Conduct

Master Circular on Credit Card Operations of Banks

Debit Collection Standard in India

3.8.12. Easy Banking

3.8.13. Internet Banking



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Current Functionalities

Become mib@nk User

Log into mib@nk

Minimum Requirements

Online Security Guidelines

3.8.14. Phone Banking

3.8.15. Mobile Banking

3.8.16. ATM Kiosks

3.8.17. Payment Services

Electronic Fund Transfer

RTGS

NEFT

Smratsery

Collection Service

Doorstep Banking Service

3.8.17. Interest Rates

Domestic & NRO Term Deposit Rates

NRE Deposit Rates

FCNR RFC Rates

3.8.18. Aqri

Term Loan

Short Term Loan

3.8.19. Business

Sme



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Object5

4.1. Analysis Of Data

Table No. 4.1

Table Showing Awareness of The Business Person (Of Sole Proprietor &

Partnership Firm) About Current Account Having Following

Monthly Business Income

(N=80)

Monthly Business Income No. Of Respondents Percentage

Less Than Rs 50.000 0 0%

Rs 50.000 - Rs 3,00,000 19 23%

More Than Rs 3.00,000 61 77%

TOTAL 80 100%

Graph No. 50

The Monthly Distribution Of The Business Income

Analysis

The above table shows that there are no respondents who have a monthly business

income of less than Rs 50.000. there are 23% of the respondents who fall under Rs

50.000 -Rs 3,00,000 household income and 77% fall under the more than Rs 3,00.000

business income category.

Interpretation

The table clearly shows that the majority of the respondents have more than Rs

3,00.000 of monthly business income that is 77%.

Table No. 2



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Object5

Table Showing the Customers Responses about Customer Care In

Ing Vysya Bank(N=80)

VARIABLES RESPONDENTS PERCENTAGE

HIGHLY SATISFIED 10 12%

SATISFIED 50 63%

NEUTRAL 16 21%

DISSATISFIED 4 4%

HIGHLY DISSATISFIED 0 0%TOTAL 80 100%

Graph No. 51



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Object5

Analysis

The above table shows that out of 100 respondents 12% are highly satisfied with the

Customer Care of the ING VYSYA Bank 63% of them are satisfied and 21% are

neutral, moreover 4% of them are dissatisfied and none of them are highly dissatisfied.

Interpretation

In today's world customer care is one of the most important criteria as it helps the

Organization to retain its or add market shares. Therefore, HDFC should work towards

the 4%,

Dissatisfied customers either by training the employees or making the procedure

customer friendly. The major problem amongst this unsatisfied group was

miscommunication between tele caller of customer care services and customer about

the charge details of the product and some delay in response.

TABLE NO. 3

TABLE SHOWING THE RESPONSES OF CUSTOMERS ABOUT OVERALL

SERVICE PROVIDED BEFORE AND AFTER CURRENT ACCOUNT OPENING:


HIGHLY SATISFIED 7 8%

SATISFIED 48 61%

NEUTRAL 17 22%



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DISSATISFIED 7 9%

HIGHLY

DISSATISFIED

0 0%

TOTAL 80 100%

Graph No. 53

Chart Showing Satisfaction Level Regarding Overall Services Provided Before

And After Opening Of Current A/C

ANALYSIS

As per the above (able it can analyzed that only 8% of the respondents are highly

satisfied with the overall services provided by ING VYSYA Bank. 61% of them are

satisfied while 72% of them are on the neutral side, 9% of them are dissatisfied and

none are highly dissatisfied.

INTERPRETATION

Hence the table clearly shows that the 9% of the customers are not satisfied with the

overall services provided by the Bank but on the same side its a good sign that 61% of

them are satisfied. These 9% clients are dissatisfied because of reasons such as:

1. Long time taken in case of new password generation when the clients request

for it.

2. Miscommunication by the sales executives about the feature and charges

before opening the account.

3. Delay in account activation due to approval taking.



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Object5

Table No. 4

Table Showing The Customer Satisfaction Level With Special Schemes Of

Current Account Provided


HIGHLY SATISFIED 22%

SATISFIED 44 55%

NEUTRAL 26 33%

DISSATISFIED 8 10%

HIGHLY DISSATISFIED 0 0%

TOTAL 80 100%

ABOUT CURRENT ACCOUNT SPECIAL SCHEME

GRAPH NO. 4



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Object5

ANALYSIS

The above table shows that 2% of the respondents are highly satisfied with the special

schemes of current account provided in ING VYSYA Bank. 55% of the respondents are

satisfied, whereas 33% are on the neutral side and 10% of the customers are

dissatisfied, none are highly dissatisfied.

INTERPRETATION

Hence. ING VYSYA Bank has only 2% of the customers who are highly satisfied with

the special schemes of current account provided in the ING VYSYA Bank should

introduce many more special schemes as 10% of the respondents are dissatisfied.

Table 5

Table Showing Market Share Of Ing Vysya

VARIABLE MARKET SHARE 1 MARKET SHARE 2

ING VYSYA 18000 19000

HDFC 20000 20000

ICICI BANK 23000 23000

TOTAL 61000 62000



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Graph No. 56

Chart Showing The Market Share Of Ing Vysya Bank

MARKET

SHARE

ANALYSIS

After doing market analysis and review of banking sector, we came to know that ING

VYSYA BANK LTD is growing steadily with firm commitment and higher level of

customer satisfaction. As comparison shows ING VYSYA BANK is second largest

organization and next to ICICI BANK. But still having better performance as compares

to others and hence we can predict better growth in future.

INTERPRETATION

ING has put together 65-strong team focusing on (small-and-medium enterprises)

SMEs. It now has a long list of between 1,500 and 2,000 clients and its SME lending

now accounts for 14 per cent of the bank's total asset portfolio. That's more than Rs2,

500crore (Rs25 billion) and it's growing at 50 per cent annually.

Table - 6

Profession Of The Respondent

(N=80)

PROFESSIONNO. OF

RESPONDENTS %



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Salaried 45 56

Self Employed 17 22

Professional 18 22

TOTAL 80 100

(SOURCES Primary Data)

Graph 6

Table 7

Preference Of The Respondents With Regard To The Institution Providing

A.T.M's And Internet Banking.

(N=80)

INSTITUTION NO. OF PERSONS %

ING Vysya Bank 8 10

ICICI 16 20

CITIBANK 23 28

HDFC 13 16



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HSBC 8 10

OTHERS 7 8

PROSPECTIVE 6 8

TOTAL 80 100


Graph 7

Interpretation

Hence we see that most of the respondents prefer City banks and ICICI with regard

to ATM's and internet banking.

Table - 8

Channel Usage By Bank Customers

(N=80)

CHANNEL NO. OF PERSON %

BRANCH 16 28



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ATM 37 46

INTERNET BANKING 12 14

MAIL 2 2

TELE-BANKING 8 10

TOTAL 80 100


Grapha - 8

Interpretation

From the above, we find majority of the people go in for ATM's and then to the

Branch.

Table 9

Type Of Accounts Maintained By Bank Customer

(N=80)

TYPE OF ACCOUNTS NO. OF PERSON %

SAVINGS 32 40



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FIXED DEPOSIT 10 12

RECURRING DEPOSIT 3 4

OVERDRAFT 7 8

CASH CREDIT 0 0

CURRENT 29 36

TOTAL 80 100


Graph 9



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Object6

Interpretation

Hence it is clear those majo

nanu ram full ready

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