HDFC Financial Analysis & Marketing Research

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HDFC BANK

Until the early 1990’s the role of financial system was primarily restricted to the function of channelizing resources from surplus to deficit sectors. Although 14 major commercial banks were nationalized in July 1969, regional rural banks were set up in 1975 and another six commercial banks were nationalized in 1980, the banking sector in India suffered form lack of competition, low capital base, low productivity, minimal role of technology, weak prudential standards and low quality of service. As a result, banks suffered from poor asset quality and low profitability and banks functioned in an overprotected environment. Therefore, when economic reforms were introduced in various sectors of the economy in 1991 under the New Economic Policy, several reforms were introduced in the banking sector also.

Subsequent to the Report of the Committee on Financial System, 1992 (Chairman: M. Narasimham) reforms in the banking sector focused mainly on enabling* and strengthening measures. During the second phase of reforms in the banking sector, which were introduced on the recommendations of the Committee on Banking Sector Reforms, 1998 (Chairman: M. Narasimham) greater stress was placed on structural measures and improvement standards of disclosure and levels of transparency, so as to align Indian standards with best international practices. As a consequence of the various measures undertaken by the government, we find that an extensive banking network has been established, banks have contributed a lot to increase in savings and Indian Banking System is no longer confined to metropolitan cities and large towns but it is spread out to remote corner of the country. With a network of about 68,330 branches, of which 47% are located in rural areas and aggregate deposits of about Rs. 12,80,567 crores and bank credit of Rs. 7,25,368 crores, Indian banking is one of the largest, if not the largest, in the world. During the last decade, both the nationalized banks and the private sector banks have grown but private sector banks have shown a much better standard in terms of different banking parameters. HDFC Bank is one such bank, which has shown tremendous progress.

* Enabling measures were designed to create an environment where financial intermediaries could respond optimally to market signals on the basis of commercial consideration


HDFC BANK – A HISTORICAL PRELUDE

HDFC Bank has been promoted by the Housing Development Finance Corporation, which is India’s premier Housing Finance Company and has a sound track record. Since its inception in 1977, HDFC has maintained a consistent and healthy growth in its operations which is evidenced by the fact that its loan approvals / sanctions and loan disbursements have been increasing year after year. The outstanding housing loans of the HDFC have increased from Rs. 29.8 crores as on 31st March 1981 to Rs. 1,726.9 crores at the end of March 1991, to Rs. 13,224.7 crores at the end of March 2001 and further to Rs. 17,169.2 crores at the end of March 2002. The corporation continues to remain a market leader and its loan portfolio covers more than a million dwelling units. HDFC has developed significant expertise in retail mortgage loans for different market segments, has a large corporate client base and has a sound market reputation. Naturally, HDFC was ideally placed to promote a bank in the Indian environment.

Under the liberalization measures adopted under the New Economic Policy, improvement in the efficiency of financial intermediaries has been at the core of the reform process. In order to provide greater choice to customers and promote competitions the Reserve Bank of India permitted the entry of new private banks and more liberal entry of foreign banks. The HDFC was amongst the first to receive in principle the approval of the RBI to set up a bank in the private sector. Therefore, HDFC Bank Ltd. was incorporated in August 1994 with its registered office in Mumbai. This bank commenced its operation as a scheduled commercial bank in January 1995. Since its inceptions, the HDFC Bank has been able to achieve healthy growth across various operating and financial parameters and has focused on four core values: Customer focus, Operational excellence, Product leadership and the people. It has tried to fulfill these values through open and transparent work culture, providing opportunities to take on challenging assignments and empowering its employees to take decisions.

An important event took place which added significant value to the HDFC Bank in terms of increased branch network, enhanced customer base, skilled manpower and leverage alternative delivery channels. This event was the amalgamation of Times Bank Limited (Promoted by Bennett Coleman and Company / Times Group) with the HDFC Bank Ltd with effect from February 26, 2000. According to the scheme of amalgamation, shareholders of Times Bank received one share of HDFC Bank for every 5.75 shares of Times bank.

We understand your worldAfter the merger of the Times bank with HDFC Bank, the HDFC Bank has been

expanding its network with passage of time.

CAPITAL STRUCTURE

The authorized capital of HDFC Bank is Rs.450 crores (Rs.4.5 billion). The paid-up capital is Rs.311.9 crores (Rs.3.1 billion) as at 31st March 2006. The HDFC Group holds 22.1% of the bank's equity, Foreign Institutional Investors (FIIs) roughly holds 31.3% and about 19.4% of the equity by the American Depository Shares (in respect of the bank's American Depository Shares issue). The FII holders include Standard life Investment (4.27%), Indian Private Equity Fund (1.58%) and Small Cap World Fund (4%) and J.P Morgan has a stake of 5.48%. The balance amount of the bank is held by about 190,000 shareholders. The shares of the HDFC Bank are listed on both Mumbai Stock Exchange (BSE) and at the National Stock Exchange (NSE). The bank's American Depository Shares are listed on the New York Stock Exchange (NYSE) under the symbol "HDB".


DISTRIBUTION NETWORK

HDFC Bank is headquartered in Mumbai. The Bank at present has an enviable network of over 535 branches spread over 228 cities against 495 branches in 217 cities in June 2005 across India. All branches are linked on an online real-time basis. Customers in over

189 locations are also serviced through Phone Banking. The Bank's expansion plans take into account the need to have a presence in all major industrial and commercial centres where its corporate customers are located as well as the need to build a strong retail customer base for both deposits and loan products. Being a clearing / settlement bank to various leading stock exchanges, the Bank has branches in the centres

where the NSE / BSE have a strong and active member base.

The Bank also has a network of about over 1323-networked ATMs across these cities. Moreover, HDFC Bank's ATM network can be accessed by all domestic and international Visa / MasterCard, Visa Electron / Maestro, Plus / Cirrus and American Express Credit / Charge cardholders.


BRANCH NETWORK – CITIES COVERED


16. Coimbatore 54. Patiala 17. Dahej 55. Phagwara 18. Daman 56. Ponda 19. Delhi 57. Pune 20. Faridabad 58. Raipur 21. Ghaziabad 59. Rajkot 22. Gurgaon 60. Rajpura 23. Hyderabad 61. Ranchi 24. Indore 62. Ropar 25. Jaipur 63. Secunderabad 26. Jallunder 64. Siliguri 27. Jamshedpur 65. Silvassa 28. Jodhpur 66. Surat 29. Kanpur 67. Thane 30. Kapurthala 68. Trichur 31. Karad 69. Trichy 32. Khanna 70. Trivandrum 33. Kolhapur 71. Udaipur 34. Kolkata 72. Vasai 35. Kota 73. Vasco 36. Kottayum 74. Vijayawada 37. Lucknow 75. Virar 38. Ludhiana 76. Vishakapatnam 77. Zirakpur

1. Agra 39. Madurai 2. Ahmedabad 40. Mangalore 3. Ambala 41. Margao 4. Amritsar 42. Mohali 5. Aurangabad 43. Mumbai 6. Bangalore 44. Mysore 7. Baroda 45. Nagpur 8. Bharuch 46. Nashik 9. Bhavnagar 47. Navi Mumbai 10. Bhopal 48. Navsari 11. Bhubaneshwar 49. Noida 12. Calicut 50. Pallakad 13. Chandigarh 51. Panchkula 14. Chennai 52. Panjim 15. Cochin 53. Patalganga


ORGANIZATIONAL STRUCTURE

General Information:Name of the organization : HDFC Bank Ltd.

Year of Establishment : August 1994

Chairman : Mr. Jagdish Capoor

Managing Director : Mr. Aditya Puri

Main Service : Banking related service

Registered Office : HDFC Bank HouseSenepati Bapat Marg,Lower Parel,Mumbai – 400 013Tel: 022 6652 1000

Website : www.hdfcbank.com

Revenue : Rs. 3,669.82 Lacs

No. of Customers of HDFC Bank : 9.5 Million

CHAIRMAN

MANAGING DIRECTOR

GROUP HEADS

BUSINESS HEADS

DIRECTORS (9)

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HDFC Bank Senior Management TeamGroup Heads

A Rajan OperationsAbhay Aima Equities & Private BankingAshish Parthasarthy TradingBharat Shah Depository & Merchant servicesC N Ram Information TechnologyG Subhramaniam Audit, Compliance, Service QualityHarish Engineer Wholesale BankingKaizad Barucha Credit & Market RiskMandeep Maitra Human ResourcesParesh Sukhthankar Credit & Market Risk & HRPralay Mondal Unsecured ProductsSamir Bhatia Corporate BankingSudhir Joshi TreasuryVinod Yennemadi Finance, Administration, LegalBusiness Heads

Ashima Bhatt SCM & ECGAshok Khanna Two Wheelers & Express LoansBhavesh Zaveri TBG OperationsChitra Pandeya Liabilities Product GroupG V Gopalakrishnan Information TechnologyJimmy Tata Corporate Banking - WestMamta Chhabra Treasury Advisory GroupManavjeet Singh Auto, Commercial Transportation &

Health CareN S Kishore Kumar Corporate Banking - SouthNavin Puri Branch Banking - WestNeena Singh Branch Banking – North 2Nitin Rao Equities & Private BankingP Ravindranath Pai TreasuryP V Ananthakrishnan Stock Exchange, Corresponding BankingRahul Bhagal Branch Sales, HNW, Phone Banking &

MarketRajendra Seghal Corporate Banking – North Sashi Jagdishan Finance & AdministrationSeshan Ramakrishnan Branch Banking – North 1Shyamal Saxena Branch Banking – North, South & East

We understand your worldSurindra Singh Chawla Branch Banking - SouthV Chakrapani Audit

MANAGEMENT STYLE

Chairman: Mr. Jagdish Capoor Managing Director: Mr. Aditya Puri

Mr. Jagdish Capoor took over as the bank's Chairman in July 2001. Prior to this, Mr. Capoor was a Deputy Governor of the Reserve Bank of India.

The Managing Director, Mr. Aditya Puri, has been a professional banker for over 25 years and before joining HDFC Bank in 1994 was heading Citibank's operations in Malaysia.

The Bank's Board of Directors is composed of eminent individuals with a wealth of experience in public policy, administration, industry and commercial banking. Senior executives representing HDFC are also on the Board.

Senior banking professionals with substantial experience in India and abroad head various businesses and functions and report to the Managing Director. Given the professional expertise of the management team and the overall focus on recruiting and retaining the best talent in the industry, the bank believes that its people are a significant competitive strength.


MISSION AND BUSINESS STRATEGY

HDFC Bank’s mission is to be “a World Class Indian Bank”, benchmarking ourselves against international standards and best practices in terms of product offerings, technology, service levels, risk management and audit & compliance. The objective is to sound customer franchises across distinct businesses so as to be a preferred provider of banking services for target retail and wholesale customer segments, and to achieve a healthy growth in profitability, consistent with the Bank’s risk appetite. The bank is committed to do this while ensuring the highest levels of ethical standards, professional integrity, corporate governance and regulatory compliance. HDFC bank’s business philosophy is based on four core values – Operational Excellence, Customer Focus, Product Leadership and People.


HDFC Bank’s business strategy emphasizes the following:

Increase our market share in India’s expanding banking and financial services industry by following a disciplined growth strategy focusing on balancing quality and quantity and on delivering high quality customer services;

Leverage our technology platform and open scaleable systems to deliver more products to more customers and to control operating costs;

Maintain high standards of asset quality through disciplined credit risk management;

Develop innovative products and services that attract our targeted customers and address inefficiencies in the Indian financial sector;

Continue to develop products and services that reduce our cost of funds;

Focus on high earnings growth with low volatility.


TECHNOLOGY

HDFC Bank operates in a highly automated environment in terms of information technology and communication systems. The strength of a bank is judged by its infrastructure and its processes. At HDFC Bank, investments have been made right from inception, to create a robust technology platform i.e. seamlessly integrated with centralized and audited processes. This has enabled the HDFC Bank to expand rapidly and grew many folds while maintaining acceptable service standards. Well-documented procedures, high levels of automation, intensive training of personnel have enabled the bank to improve the reliability of its operational processes. ISO 9002 certifications of its cash management, retail centralized processing and custody and depository operations are indicative of the bank’s achievement in this regard.

The Bank has made substantial efforts and investments in acquiring the best technology available internationally, to build the infrastructure for a world-class bank. In terms of software, the Corporate Banking business is supported by Flexcube, while the Retail Banking business by Finware, both from i-flex Solutions Ltd. The systems are open, scaleable and web-enabled. The technology adopted at the HDFC bank has also enabled it to offer innovative products and services with greater convenience and at an affordable price. It has offered products to match the needs of every customer – corporate or individual, borrower or investor. All the bank's branches have online connectivity, which enables the bank to offer speedy funds transfer facilities to its customers. Multi-branch access is also provided to retail customers through the branch network. The bank makes available more than 40 products to serve the needs of its growing customers. Their customers have access to their accounts as and when they need it through the internet, mobile, Automated Teller Machines (ATMs), Phone banking, Debit card and through personal visit into a branch. Almost 80% of customers are serviced through the non-branch channels – ATMs, Phone banking, Net banking and Mobile banking. Banks ATM network had expanded to 1323 by the end of March, 2006.

The Bank has prioritized its engagement in technology and the internet as one of its key goals and has already made significant progress in web-enabling its core businesses. In each of its businesses, the Bank has succeeded in leveraging its market position, expertise and technology to create a competitive advantage and build market share. With this significant infrastructure expansion, the bank’s customers have even

We understand your worldgreater convenience and choice in dealing with the bank – “Any time, any where, any how”.

RISK MANAGEMENT & PORTFOLIO QUALITY

Risk is integral to almost every aspect of the banking business and sound risk management and risk – rewards trade offs are critical to the bank’s success. It is well accepted that revenues that bank earn, relate to a large extent to the risks the bank accept. Business and revenue growth therefore, have to be weighed in the context of the risks implicit in the bank’s business strategy. While the bank is exposed to various types of risk, the most important amongst them are credit risk, market risk (which includes liquidity risk and price risk) and operational risk. The identification, measurement, monitoring and management of risks remain a key focus area for the bank. For credit risk, distinct policies and processes are in place for the wholesale and retail asset businesses. For wholesale credit exposures, management of credit risk is done through target market definition, appropriate credit approval processes, ongoing post-disbursement monitoring and remedial management procedures. On the other hand Portfolio diversification remains key, particularly given the volatility in the business environment and facilitates risk management. In the retail asset businesses, the credit cycle is managed through credit policy definition, appropriate front-end credit buying, operations and collection processes enable the management of risk on a portfolio basis for different products and customers segments.

The Risk monitoring Committee of the board monitors the bank’s risk management policies and procedures and reviews portfolio composition and impaired

credits. From an industry concentration perspective, as of march 31, 2006, the core retail portfolio constituted 41.3% of total customer assets. The large industry exposures included the share of automobiles at 10.7%, transportation at 9.6%,

(Rs. Lacs)Gross Loans

% toGross Loans

Retails – Except where otherwise classified 1587898 41.3%Automobiles 409703 10.7%Transportation 368416 9.6%Retail Trade 143573 3.7%Engineering 129072 3.4%Agriculture 115597 3.0%NBFC* / Investment Companies 104303 2.7%Others < 2% of Advances(29 industries) 982695 25.6%Total 3841257 100.0%

We understand your worldagriculture at 3.0% heavy engineering at 3.4% and investment companies at 2.7% of customer assets.

* NBFC: Non Banking Financial Companies

The well-diversified nature of the portfolio is evidenced by the fact that 29 industries account for 2% or less of the bank’s customer asset portfolio. As of March 31, 2006, the bank’s ratio of gross non-performing assets (NPAs) to total customer assets was 1.17% as against 1.47% as of March 31, 2005 and 1.50% at the end of March 2004.

There has been an increase in non-performing assets* (NPAs) in absolute terms during the year. Increases in NPAs during the year were primarily related to delinquencies in various retail loan products. These delinquencies and NPAs were within the expected levels for each of the retail asset products given the seasoning of the retail portfolio. Net non-performing assets (gross non-performing assets less specific loan loss provisions, interest in suspense and ECGC claims received) were 0.44% of net advances and 0.36% of customer assets as of March 31, 2006 as against 0.24% and 0.20% respectively as of march 31, 2005 reflecting the higher proportion of retail loans in the bank’s loan book and the changing mix of the retail loan portfolio.

The bank continues to have a policy of creating general provisions upfront based on estimated portfolio losses for its major retail loan product programs against which specific provisions are set-off as the portfolio ages and NPAs surface. As on March 31, 2006, total general loan loss provisions were 0.5% of the standard advances which was above the regulatory requirement. Towards meeting the requirements, the Bank launched a suite of new credit risk rating models during the year for rating entities specific to each segment in wholesale credit. To automate the entire computation process for credit under various approaches, the Bank is currently implementing a Portfolio Credit Risk Management (PCRM) model.


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* According to the guidelines of RBI, a non-performing asset (NPA) is one in respect of which the interest and / or installment of principal has remained due for over 90 days.

HUMAN RESOURCES

Given the Bank’s significant expansion in terms of geographical area as well as in terms of products and business volumes, the Bank’s staffing-needs continued to increase during the year particularly in the retail banking businesses. In addition, changes in regulatory guidelines necessitated additions to the staff in respect of sales function for liability products. Simultaneously, the total number of employees increased from 5673 as of March 31, 2004 to 9030 as of March 2005 to 14878 as of March 31, 2006. The Bank continues to focus on training its employees on a continuing basis, both on the job and through training programs conducted by internal and external faculty. The Bank has consistently believed that broader employee ownership of its shares has a positive impact on its performance and employee motivation. The Bank’s employee stock option scheme therefore extends to all levels and so far covers around 59% of the employees. .


SEGMENTATION INFORMATION

The Bank operates in three segments: Retail Banking, Wholesale Banking and Treasury Services. Segments have been identified and reported taken into account, the target customer profile, the nature of products and services, the differing risks and returns, the organization structure and the internal business reporting systems.

The Retail Banking Segment serves retail customers through a branch network and other delivery channels. This segment raises deposits from customers and makes loans and provides advisory services to such customers. Revenues of the retail banking segment are from interest earned on retail loans, net of commission (net of subvention received) paid to sales agents, interest on card receivables, gains / loans from securitization receivables, fees for banking and advisory services and interest earned from other segments for surplus funds placed with those segments. Expenses of this segment primarily comprise interest expense on deposits, infrastructure and premises expenses for operating the branch network and other delivery channels, personnel costs, other direct overheads and allocated expenses.

The Wholesale Banking Segment provides loans and transaction services to corporate and institutional customers. Revenues of the wholesale banking segment consist of interest earned on loans made to corporate customers and the corporate supply chain customers, investment income from commercial paper, debentures and bonds, interest earned on the cash float arising from transaction services, fees from such transaction services and also trading operations on behalf of corporate customers in debt, foreign exchange and derivatives segment. The principal expenses of the segment consist of interest expense on funds borrowed from external sources and other internal segments, premises expenses, personnel costs, other direct overheads and allocated expenses.

The Treasury Services Segment undertakes trading operations on the proprietary account, foreign exchange operations and derivatives trading. Revenues of the treasury

We understand your worldservices segment primarily consist of fees and gains or losses from trading operations and net interest earnings on assets held in the treasury desk book.

The summary in form of financial report of the three operating segments of the Bank is as follows:

(Rs. Lacs)Particulars 2005-06 2004-051. Segment Revenue a) Retail Banking 5,173,84 3,536,27 b) Wholesale Banking 2,853,38 2,056,35 c) Treasury 773,89 286,89

Particulars 2005-06 2004-05Total 8,801,11 5,879,51Less: Inter Segment Revenue 3,201,79 2,134,68 Income from operations 5,599,32 3,744,68

2. Segment Results a) Retail Banking 701,67 520,64 b) Wholesale Banking 537,87 539,36 c) Treasury 13,97 (81,06) Total Profit Before Tax 1,253,51 978,64Income Tax Expense (382,73) (313,38) Total Result 870,78 665,56

3. Capital Employed Segment Assets a) Retail Banking 38,571,09 24,469,93 b) Wholesale Banking 28,790,53 24,962,34 c) Treasury 5,733,94 1,756,03 d) Unallocated 410,83 240,70 Total Assets 73,506,39 51,429,00 Segment Liabilities a) Retail Banking 38,584,25 27,361,46 b) Wholesale Banking 26,717,93 14,932,39

We understand your world c) Treasury 2,708,22 4,455,16 d) Unallocated 196,46 160,14 Total Liabilities 68,206,86 46,909,15

PRODUCTS & MARKET

HDFC Bank caters to a wide range of banking services covering both commercial and investment banking and has offered different types of accounts and cards to meet the changing needs of a dynamic and comparative economy. Among the diversified portfolio products offered by HDFC Bank some of the important products offered are:

1. SAVINGS ACCOUNT2. CURRENT ACCOUNT3. SALARY / CORPORATE ACCOUNT4. FIXED DEPOSITS

a) Regular Fixed Depositb) Super Saver Accountc) Sweep-in Account

5. DEMAT ACCOUNT6. NRI ACCOUNT7. LOAN8. CREDIT CARDS

Apart from this HDFC Bank also sells third party products like Mutual Funds, Bonds, Insurance to its retail customers.

SAVINGS ACCOUNT:

Banking should be effortless. With HDFC Bank, the efforts are rewarding. No matter what a customer's need and occupational status, the bank has a range of solutions that are second to none. HDFC Bank has the perfect solution and also can recommend products that can augment planning for the future. Savings Accounts are primarily meant to inculcate a sense of saving for the future, accumulating funds over a period of time. Individual can open an account in their

We understand your worldname or register for one jointly with a family member. The Bank is offering various types of savings account under the retail banking segment.

1. Regular Savings Account:An easy-to-operate savings account that allows issuing cheques, draw Demand Drafts and withdraw cash. The customer can check up their own balances with ease form the home or office through NetBanking, PhoneBanking and MobileBanking.

2. “No Frills” Savings Account:In an effort to make banking simpler and more accessible for the customers, Bank has introduced the 'No Frills' Savings Account, which offers all the basic banking facilities, while maintaining a nominal average quarterly balance of only Rs. 250. Through this account one can access a wide network of branches and over a thousand ATMs across the country to meet the banking needs. This includes 9 free cash withdrawals per quarter at HDFC branch, 1 cash withdrawal per month at the branch and 2 cash withdrawals per month at HDFC Bank ATMs. Additional branch cash withdrawals in the month will be charged @ Rs.50/- per transaction. Cheque deposits at branches will be free of charge and without any restrictions. The facility of International Debit Card could be enjoy only on request at the branch, which cost Rs. 100/- p.a. for each applicant.

3. Retail Trust Account:The Retail Trust Account is beneficial for Trusts and Societies as it earns them a higher interest as compared to a conventional Current Account that offers no interest. HDFC Bank's Retail Trust now offers features and benefits previously offered only on Current Accounts.- Enjoy free DD's payable on HDFC bank locations up to a limit of Rs.

50,000/- per DD, per day.- Avail of free Outstation Cheque Collection at HDFC Bank locations

across the country.- Access the account from any of the branches in the HDFC banking

network.- Avail of facilities like Free 24-hour Phone Banking and Net Banking and

carry out banking transactions with ease from home or office.

4. Kid’s Advantage Account:HDFC Bank offers to an account for the kids, which facilitates to builds up savings for child’s future. This needs to open a kid’s advantage account and deposits money into the account every month. The accumulated savings in the

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We understand your worldKids Advantage Account can over the years help in meeting the child's needs. Opening the account with HDFC Bank will cover Free International Debit Card for the kids (above 7 years of age) with a maximum drawing capability of Rs. 2,500/- per day. Free Education Insurance cover of up to Rs. 1,00,000/- for the child with every Kids Advantage Account.

5. Pension Saving Bank Account:A Pension Saving Account is a Zero Balance Account that accumulates the pension over the years. It comes with a free International Debit card and facilities like Phone and Net Banking. This Account can be accessed from any branch within the HDFC network and the customer can also request for

transfer to another bank. The HDFC bank provides certain advantages to pension saving account holders like:- Pension Accounts are opened immediately after advice, and deliverables reach in time- within the 1st and 5th of the new month (in case of EPFO) and last day of the month (in case of Central Govt. Civil Pensions).- No delays in commencement of pension disbursals (subject to all the stipulated terms/conditions are fulfilled by the pensioner).- Dispatch of credit advice containing detailed calculations of the amount credited each month within 10 days of the payment.- Timely intimation of revisions due to changes in rates of Pension or Dearness Allowance.

6. Family Saving Group Account:The Family Savings Group links together upto four individual HDFC Bank accounts (same family) under a single group. All the account holders can take the advantage of the group Average Quarterly Balance (AQB) and can operate their account freely without worrying about the minimum balance.

CURRENT ACCOUNT: With an HDFC Bank Current Account, the individual can experience the freedom of multi-city banking. This will enhance the power of multi-location access to current account from any of our 535 branches in 228 cities. Not only that, the account holder can do most of their banking transactions with ease from home or office without stepping out. The bank offers a Current Account with all the benefits that one needs to stay ahead from competition. HDFC Bank understands that running a business requires time and money and also needs constantly evolving. The Bank provides with a choice of Current Account options to exclusively suit the kind of business - whatever the size or scope. The Bank is offering various types of current account under the retail banking segment.

We understand your world1. Plus Current Account:

In today's fast-paced world, business regularly requires to receive and send funds to various cities in the country. HDFC Bank Plus Current Account gives the power of inter-city banking with a single account and access to more than 228 cities. From special cheques that get treated at par with local ones in any city where HDFC Bank has a branch; to free collection of outstation cheques (payable at branch locations); to free inter-city funds transfers of up to 100 lakhs, the bank priority services have become the benchmark for banking efficiency.

2. Regular Current Account:A Current account is ideal for carrying out day-to-day business transactions. With the HDFC Bank Regular Current Account, the account holder can access their account anytime, anywhere. Withdraw and deposit cash, issue and encash cheques, make balance-inquiries or ask for mini statements, and even request for cheque books can be done any time, anywhere. With a vast network of branches in cities all over the country, and access to a multitude of ATM's, one can keep track of all transactions at anytime.

3. Trade Current Account:In today's changing business requirements, one needs to transfer funds across cities, and time is of the essence. HDFC Bank Trade Current Account gives the power of inter-city banking with a single account. From special cheques that get treated at par with local ones in any city where HDFC Bank has a branch; to free collection of outstation cheques (payable at branch locations); to free inter-city funds transfers of up to 25 lakhs, the bank services have become the benchmark for banking efficiency.

4. Premium Current Account:The business needs a partner who can manage the finance efficiently while one concentrated on growing his business. The bank provides with the benefits of inter-city banking account with Premium Current Account, that requires an average quarterly balance of only Rs. 25,000 per quarter with Payable-At-Par cheque book facility & free inter-city finds transfer across our network upto Rs.10 Lacs per month.

5. Reimbursement Current Account:A hassle-free Account that allows the customers to deposit the reimbursements that receives from the company on a monthly basis. The customer does not have to maintain a minimum balance with the bank.

6. RFC – Domestic Account:

We understand your worldIt is a Resident Foreign Currency Domestic Account that manages the customer’s foreign currency quite efficiently. The customer can choose to set up his own account either in US Dollar, Great Britain Pound European Euro.

SALARY / CORPORATE ACCOUNT:

HDFC Bank offers five kinds of salary account to its customer. These are as follows.

1. Classic Salary Account:The Classic Salary account is a Zero Balance Account which earns normal interest on the savings from salary at a competitive rate fixed by the bank from time to time. There is no fee applicable for branch transactions and the account holder receives banking statements once every six months. The account facilitates with free personalized cheque books, free ATM Card with a withdrawal limit of up to Rs. 10,000/- per day, free facilities like Net Banking, Phone Banking and Mobile Banking.

2. Payroll Account: The HDFC Bank payroll account offers flexibility as well as access to

premium features like BillPay, Insta Alert at a nominal charge. The customer can also access their account anytime by phone or through the Internet and pay for their utility bills at a nominal charge.

3. Regular Salary Account:The Regular account is a Zero Balance account and comes with a Free International Debit Card, facilities like free inter-city/branch banking and Safe Deposit lockers.

4. Premium Salary Account:A power-packed account for successful salaried professionals, the Premium Salary account comes with a free International Debit Card and add-on Debit card for life, with the option of choosing between a Silver or Gold credit card at preferential rates.

5. Defence Salary Account:The account is mainly meant for defence personnel working with the Indian Armed Force or Indian Navy. The account is a zero balance account and comes with a free International Debit Card.

We understand your world FIXED DEPOSITS:

Long-term investments form the chunk of everybody's future plans. An alternative way too simply by applying for loans, fixed deposits allow to borrow from customer’s own funds for a limited period, thus fulfilling the needs as well as keeping the savings secure. There are three basic types of fixed deposits that a customer can go for it.

1. Regular Fixed Deposit:Invest your savings, and then let them work for you.

If one believes in long-term investments and wish to earn higher interests on savings, then invest the money in a Fixed Deposit. By investing in a HDFC Bank Fixed Deposit, the customer’s money not only stays secure but also accumulates good interest over the period of deposit. Partial withdrawal from fixed deposits before the date of maturity can bail out in times of need.

2. Super Saver Facility:The customer can enjoy a high rate of interest along with the liquidity of an savings account by opting for a Super Saver Facility and avail of an overdraft facility of up to 75% of the value of fixed deposit.

3. Sweep-in Facility:The customer can link the Fixed Deposit with savings or current account and use it to fall back on in case of emergencies. A deficit in the savings or current account is taken care of by using up an exact value from the fixed deposit. Since deposits are broken down in units of Re 1/-, the customer will lose interest only for the actual amount that has been withdrawn.

DEMAT ACCOUNT:

Dematerialization account is the process by which physical certificates of an investor are converted into equivalent number of securities in electronic form and credited to the investor’s account with his Depository Participant. The bank offers its customer for opening a Demat Account so that their online trading could be made easy. The annual charges for maintaining a Demat Account with HDFC Bank is Rs. 500 p.a.

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http://www.hdfcbank.com/personal/accounts/regular_fd.htm

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We understand your world NRI ACCOUNT:

As an NRI customer, the bank understands that you have specific banking needs. That is why, the bank offers a variety of accounts & deposits specially designed to suit the customer’s precise need.

1. Rupee Savings Accounts: NRE Savings Account NRO Savings Account Special RI Savings Account

2. Rupee Current Accounts: NRE Current Account NRO Current Account

3. Rupee Fixed Deposits: NRE Fixed Deposits NRO Fixed Deposits SuperSaver Account Sweep-in Account

4. Foreign Currency Deposits: FNCR Deposits

5. Accounts for Returning Indians: RFC Savings Account RFC Current Account RFC Fixed Deposits

LOANS:

HDFC Bank offer different types of loan to their customer. These are as below:

1. Personal Loan 11. Commercial Vehicle Finance

2. Home Loan 12. Working Capital Finance

3. Two Wheeler Loan 13. Construction Equipment Finance

4. New Car Loan

5. Used Car Loan


6. Overdraft Against Car

7. Express Loan

8. Loan Against Securities

9. Loan Against Property

10. Health Care Finance

CREDIT CARDS:

Silver Credit Card Health Plus Credit Card Value Plus Credit Card

Idea Gold Credit Card Idea Silver Credit Card Gold Credit Card

Titanium Credit Card Woman’s Gold Credit Card Corporate Credit Card

DEBIT CARDS:

Easy Shop International Gold Easy Shop International Debit Easy Shop Woman’s

We understand your worldDedit Card Card Advantage Debit Card

PREPAID CARDS:

ForexPlus Card GiftPlus Card Kisan Card

HDFC BANK – OPERATIONS

The overall performance during the financial year 2005-06 remained healthy with total net revenues (net interest income plus other income) increasing by 51.1% to Rs. 3669.8 crores from Rs. 2429.3 crores in 2004-05. The HDFC Bank has registered a robust growth in different Balance Sheet parameters. Total deposits of the bank have increased from Rs. 2,192 crores on 31st March, 1998 to Rs. 8,428 crores as on 31st March 2002 to Rs. 17,654 crores on 31st March, 2003 to Rs. 30,409 crores on 31st March 2004 to Rs. 36,354 crores as on 31st March 2005 and to Rs. 55,797 crores as on 31st March 2006. Thus, there has been a tendency of the total deposits to nearly double in a span of two years. Total deposits of Rs. 55,797 crores at the end of March 2006 also included around Rs. 2,000 crores of collections held as a banker to various initial public offerings. Savings account deposits, which are core to the bank’s strategy for building stable, low cost sources of funds and reflect the strength of the retail liabilities franchise, increased from Rs. 1,903 crores on 31st March, 2001 to Rs. 2,960 crores on 31st March, 2002 to Rs. 4,663 crores on 31st March 2003 and further to Rs. 7,804 crores on 31st March 2004 to Rs. 16,186 crores on 31st March, 2006 and current account deposits at Rs. 14,752 crores. Thus, savings and current account deposits both have shown a compound annual growth rate of 55.4% of the total deposits as on March 31, 2006. The average savings balance per account has also increased from Rs. 19,363 in 2004 to Rs. 26,732 in 2006. Further, the share of savings deposit in the HDFC Bank is now 67.4% of total deposits. Because of this, the mix of deposits is skewed in favour of low cost deposits. During the year 2005-06, the bank’s incremental cost of deposits for the first time stood under 4%.

Along with increase in deposits, loans and advances by the HDFC Bank have also increased rapidly with the passage of time. During 2005-06, gross advances grew by 48.1% to Rs. 38,413 crores. Net advances of the bank increased from Rs. 842

We understand your worldcrores on 31st March 1998 to Rs. 3,462 crores on 31st March 2000, to Rs. 6,814 crores on 31st March 2002, to Rs. 17,745 crores on 31st March, 2004 and more rapidly to Rs. 35,061 crores on 31st March 2006. This rapid increase in advances was primarily driven by a growth of 112.9% in retail advances (including Car loans, personal loans, two-wheeler loans, commercial vehicle loans, etc. but excluding investment in securitized paper) and an increase of 25.7% in wholesale advances. The mix of bank's total advances as on March 31st, 2006 was 60% wholesale (Rs. 21,037 crores) and 40% retail (Rs. 14,024 crores)

BUSINESS SEGMENT UPDATE

The overall banking environment remained benign in 2005-06, other than the drying up of liquidity and resultant hardening of interest rates in the last quarter. The bank has been able to achieve healthy growth across various operating and financial parameters. This performance reflects the strength and diversity of the bank’s three primary business franchises – Retail Banking, Wholesale Banking and Treasury, as well as a disciplined approach to risk – reward management.

The Retail Banking Business continued to be the fastest growing of the Bank’s businesses in 2005-06. The Bank has positioned itself as a one-stop-shop financial services provider, focused primarily on the middle class, mass affluent and high Networth segments. During 2005-06, the Bank launched the “no-frills account”, a basic savings account offering. This product would facilitate financial inclusion for customers who wish to maintain only token minimum balances in their savings accounts. The Bank’s range of retail financial products and services is fairly exhaustive including various deposit products, loans, credit cards, debit cards, depository (custody services), investment advice, bill payments and various transactional services. The bank sells third party financial products like mutual funds and insurance to the retail customers. The success of the Bank’s multi channel strategy is evidenced in the fact that almost 77% of customers initiated transactions are serviced through the non-branch channels. The Bank’s total customer base increased from 68.1 lacs in March 2005 to 96.0 lacs in March 2006. The Bank’s focus on semi urban and under banked market continued, with about 545 of the Bank’s branches now outside the top nine cities. The Bank also extends more than half of its retail loans in non-metro markets. The Bank’s success in its third party distribution business is best evidenced with income from sales of mutual funds and life insurance policies contributing over 20% of retail fees and commission. On the Bank’s housing loan business, the origination of the HDFC home loan product crossed Rs. 2 billion per month in March 2006.


In the Wholesale Banking Business, the Bank provides its corporate and institutional clients a wide range of commercial and transactional banking products, backed by high quality service and relationship management. The Bank now has four business groups catering to various Small and Medium Enterprise customers extending its services including cash management services, foreign exchange products and electronics banking. The Bank also achieved healthy growth in its agriculture and micro financing. Products including the Kisan Gold Card, rural supply chain initiatives and commodity finance covering the entire agriculture financing cycle, the Bank’s direct agriculture lending increased by over 60% during the year. The Bank has relationships with over 25 micro finance institutions and has provided financing where the ultimate

beneficiaries exceed 300000 households. During financial year 2005-06, growth in the wholesale banking business continued to be driven by new customer acquisition and higher cross sell with a focus on optimizing yields and increasing product penetration. The Bank further consolidated its position as a leading player in the cash management business (covering all outstation collection, disbursement and electronic fund transfer products across the Bank’s various customer segment) with volumes growing from about Rs. 800000 crores in financial year 2004-05 to over Rs. 1000000 crores in financial year 2005-06. The Bank also strengthened its market leadership in cash settlement services for major stock exchanges and commodity exchanges in the country. The Bank met the overall priority sector lending requirement of 40% if net bank credit.

The Bank’s Treasury Banking Business has a presence in the foreign exchange, derivatives and local currency debt securities and money market. The treasury group manages the Bank’s balance sheet and its responsible for compliance wit reserve requirements and management of market and liquidity risk. During 2005-06 revenues from foreign exchange and derivative transactions grew by 6.35 to Rs. 118.6 crores with over 40% of the revenue streams emanating from retail and Small and Medium enterprise (SME) segments. The Bank has to realize gains in a declining interest rate environment but exposes the Bank to losses or depreciation in value of investments when yields rise. HDFC Bank remains exposed to market risk primarily on the non-SLR investment portfolio in the Available for Sale (AFS) category. In March 2006, there was a sharp increase in short term yields in the debt market which resulted in marked to market loss of Rs. 89.7 crores mainly on the non-SLR book.


FINANCIAL HIGHLIGHTS

The Board of Directors of HDFC Bank Limited approved the annual audited (Indian GAAP) accounts for the year ended March 31, 2006 at their meeting held in Mumbai on Monday, April 17, 2006. The comparative financial statement for the last six years is as follows:

(Rs. Lacs)2000-01 2001-02 2002-03 2003-04 2004-05 2005-06

Interest Income 1,259,46 1,702,99 2,013,61 2,548,93 3,093,49 4,475,34Interest Expense 753,75 1,073,74 1,191,96 1,211,05 1,315,56 1,929,50Net Interest Income 505,71 629,25 821,65 1,337,88 1,777,93 2,545,84Other Income 176,57 335,90 465,55 480,03 651,34 1,123,98Net Revenues 682,28 965,15 1,287,20 1,817,91 2,429,27 3,669,82Operating costs 309,59 417,95 577,05 810,00 1,085,40 1,691,09Operating Result 372,69 547,20 710,15 1,007,91 1,343,87 1,978,73Provisions and Contingencies 57,63 121,82 139,30 288,95 364,93 725,22Profit before tax 315,06 425,38 570,85 718,96 978,94 1,253,51Provision for taxation 104,94 128,34 183,25 209,46 313,38 382,73Profit after tax 210,12 297,04 387,60 509,50 665,56 870,78Funds:Deposits 11,658,11 17,653,81 22,376,07 30,408,86 36,354,25 55,796,82Subordinated debt 200,00 200,00 200,00 600,00 500,00 1,702,00Stockholders’ Equity 913,09 1,942,28 2,244,83 2,691,88 4,519,85 5,299,53Working Funds 15,617,33 23,787,38 30,424,08 42,306,99 51,429,00 73,506,39Loans 4,636,66 6,813,72 11,754,86 17,744,51 25,566,30 35,061,26Investments 7,145,14 12,004,02 13,388,08 19,256,79 19,349,81 28,393,96


Key Ratios:Earnings per share (Rs.) 8.64 11.01 13.75 17.95 22.92 27.92Return on Average Networth 24.53% 18.30% 18.10% 20.14% 20.44% 17.47%Tier 1 Capital Ratio 8.69% 10.81% 9.49% 8.03% 9.60% 8.55%Total Capital Ratio 11.09% 13.93% 11.12% 11.66% 12.16% 11.41%Dividend per share (Rs.) 2.00 2.50 3.00 3.50 4.50 5.50**Dividend payout ratio 25.55% 23.68% 24.72% 22.15% 24.00% 22.55%Book value per share as at March 31, 2006 (Rs.) 37.50

69.00 79.60 94.52

145.86 169.24

Market price per share as at March 31, 2006 (Rs.)* 228.35 236.60

234.55

378.75 573.64 774.25

Price to Earnings Ratio 26.43 21.50 17.06 21.10 25.03 27.74Rs. 10Lacs = Rs. 1 Million Rs. 1 Crore = Rs. 10 Million ** Proposed * Source: NSE

HDFC BANK LIMITED BALANCE SHEET AS AT 31 ST MARCH, 2006


In terms of our report of even date attached. For and on behalf of the Board Keki M. MistryFor P.C. Hansotia & Co. Jagdish Capoor Vineet JainChartered Accountants Chairman Ashim Samanta

Khurshed N. Pastakia Aditya Puri Dr. Venkat Rao GadwalPartner Managing Director Renu Karnad

Sanjay Dongre Arvind Pande Vice President (Legal) Bobby ParikhMumbai, 17 April, 2006 & Company Secretary Director

_______________________Rs. 10 lacs = Rs. 1 million

Financial Analysis:

CAPITAL AND LIABILITIESCapitalReserves and SurplusEmployees’ stock options (grants) outstandingDeposits Borrowings Subordinated debtOther liabilities and provisions Total

ASSETSCash and balances with Reserves Bank of IndiaBalances with banks and money at call and short noticeInvestments AdvancesFixed assetsOther assets Total

Contingent liabilitiesBills for collection

The attached notes form part of the financial statements.

Schedule

12

34

5

6

789

10 11

12

As at 31.03.2006

313,14 4,986,39

755,796,82 2,858,48 1,702,00 7,849,4973,506,39

3,306,61

3,612,39 28,393,96

35,061,26 855,08 2,277,0973,506,39

214,782,34 2,828,89

(Rs. Lacs)As at

31.03.2005

309,88 4,209,97

4336,354,25 4,790,01 500,00 5,264,4651,429,00

2,650,13

1,823,8719,349,8125,566,30 708,32 1,330,5751,429,00

140,777,15 2,549,68

We understand your world Profit & Loss Account: Quarter ended March 31, 2006

For the quarter ended March 31, 2006, the Bank earned total income of Rs. 1,682.7 crores as against Rs. 1,087.3 crores in the corresponding quarter ended March 31, 2005. Net revenues (net interest income plus other income) were Rs. 1,043.6 crores for the quarter ended March 31, 2006, an increase of 42.2% over Rs. 733.6 crores for the corresponding quarter of the previous year. Interest earned (net of loan origination costs) increased from Rs 867.2 crores in the quarter ended March 31, 2005 to Rs. 1,378.5 crores in the quarter ended March 31, 2006. Net interest income (interest earned less interest expended) for the quarter ended March 31, 2006 increased by 44.0% to Rs. 739.4 crores, driven by average asset growth of 47.6% and a net interest margin of just over 4%.

Other income for the quarter ended March 31, 2006 was up by 38.2% to Rs. 304.2 crores, consisting primarily of fees & commissions of Rs. 336.7 crores, foreign exchange & derivatives revenues of Rs. 46.3 crores, and profit / loss on sale & revaluation of investments of Rs. (86.8) crores as against Rs. 176.8 crores, Rs 25.5 crores and Rs. 20.5 crores respectively for the quarter ended March 31, 2005. Losses on sale & revaluation of investments during the quarter were primarily on non-SLR investments, due to the sharp increase in short term yields in the debt market in March 2006. Operating expenses for the quarter at Rs. 482.3 crores were 46.2% of net revenues. Provisions and contingencies for the quarter were Rs. 181.6 crores (against Rs. 107.1 crores for the corresponding quarter ended March 31, 2005), and primarily comprised general & specific loan loss provisions of Rs. 110.3 crores and amortization for investments (in the Held to Maturity category) of Rs. 71.7 crores as against Rs. 55.1 crores and Rs. 59.6 crores respectively for the corresponding quarter ended March 31, 2005. After providing Rs. 116.4 crores for taxation, the Bank earned a Net Profit of Rs. 263.2 crores, a 30.1% increase over the quarter ended March 31, 2005.

Profit & Loss Account: Year ended March 31, 2006For the year ended March 31, 2006, the Bank earned total income of Rs. 5,599.3 crores as against Rs. 3,744.8 crores in the corresponding period of the previous year. Net revenues (net interest income plus other income) for the year ended March 31, 2006 were Rs. 3,669.8 crores, up 51.1% over Rs. 2,429.3 crores for the year ended March 31, 2005. Net Profit for year ended March 31, 2006 was Rs. 870.8 crores, up 30.8%, over the corresponding year ended March 31, 2005.

Balance Sheet: Audited as on March 31st, 2006

We understand your worldDuring 2005-06, the Bank’s total balance sheet size increased by 42.9% to Rs. 73,506.4 crores. Total Deposits increased by 53.5% from Rs. 36,354.3 crores (as of March 31, 2005) to Rs. 55,796.8 crores (as of March 31, 2006). Savings account deposits at Rs. 16,185.8 crores and current account deposits at Rs. 14,752.5 crores, together accounted for approximately 55.4% of total deposits as of March 31, 2006. During 2005-06, gross advances grew by 48.1% to Rs. 38,412.6 crores. This was driven by a growth of 79.7% in retail advances to Rs. 21,231.1 crores, and an increase of 21.7% in wholesale advances to Rs. 17,181.5 crores. One of the reasons for the high growth rate in retail loans was that the quantum of retail loans securitized (sold) during the year was less than half of the Rs.4,800 crores sold during the previous year. The bank’s core customer assets (advances plus credit substitutes like commercial paper, corporate bonds etc.) increased by 44.9% to Rs. 38,992.4 crores in March 2006. In addition, the bank held Rs. 4,457.1 crores of investments in mortgage backed and asset backed securities where the underlying assets were primarily home loan and commercial vehicle/car loans receivables. Total customer assets (including securitization investments) were therefore Rs. 43,449.5 crores as of March 31, 2006.

Dividend Payout: The Board of Directors recommended an enhanced dividend of 55% for the year ended March 31, 2006, as against 45% for the previous year (which included a special one-time dividend of 5% on the occasion of the Bank completing 10 years of operations). This would be subject to approval by the shareholders at the next annual general meeting.

Capital Adequacy Ratio: The Bank’s total Capital Adequacy Ratio (CAR) as at March 31, 2006 stood at 11.4% as against the regulatory minimum of 9.0%. Tier-I CAR was 8.6%. During 2005-06, 32.7 lac shares were allotted to the employees of the Bank pursuant to the exercise of options under the Employee Stock Option Scheme of the Bank. The Bank raised Rs 1,202 crores subordinated debt at an annualized coupon ranging between 7.5% to 8.6% and having a maturity from 9 to 10 years. The debt is subordinated to present and future senior indebtness of the Bank and qualifies as Tier-II capital under RBI’s guidelines for assessing capital adequacy for the year 2005-06.


ACHIEVEMENTSHDFC Bank began operations in 1995 with a simple mission: to be “a World-class Indian Bank". The Bank realized that only a single-minded focus on product quality and service excellence would help to get there. Today, the Bank is proud to say that it is well on the way towards that goal.

It is extremely gratifying that Bank’s efforts towards providing customer convenience have been appreciated both nationally and internationally.

AWARDS FOR THE YEAR 2005-06

“Best Bank in India” – 2005 Business Today – KPMG Survey

“Best Domestic Commercial Bank” & “Best Cash Management Bank” – India – Asiamoney Awards for Corporate Excellence 2004-05

“Best Bank” – India – Finance Asia

“Company of the Year” – The Economic Times Awards for Corporate Excellence 2004-05

“Best Domestic Bank In India” – The Asset Triple A Country Awards 2005

“Most Customer Responsive Company – Banking and Financial Services” – The Economic Times – Avaya Global Connect Customer Responsiveness Awards 2005


"Best Bank in India" – 2004 Business Today – KPMG Survey

"Best Overall Local / Domestic Bank – India - Hong Kong-based Finance Asia magazine

"One of India's Most Respected Companies " as part of The Business World Most Respected Company Awards 2004 - Business World

We understand your world “Best Under a Billion 100 Best Smaller Size Enterprises in Asia /

Pacific and Europe” - Forbes Global

“Operational Excellence in Retail Financial Services” – India - Asian Banker Excellence in Retail Financial Services Program


“Best Local Bank” – India - Hong Kong-based Finance Asia magazine

"Best Bank in India" – 2003 Business Today – KPMG Survey

“Best Domestic Bank” - The Asset Triple A Country Awards

“Best Under a Billion, 200 Best Small Companies for 2003” - Forbes Global

“Best New Private Sector Bank - 2003 in the FE-Ernst & Young - The Financial Express

“Best Bank in the Private Sector” - Outlook Money magazine

“Best IT User in Banking” - NASSCOM and economictimes.com – 2003


“Best Local Bank” – India - Hong Kong-based Finance Asia magazine

"Best Bank in India” - Euromoney magazine

“Commercial Bank in India 2002” - Asiamoney magazine


“Best Domestic Commercial Bank – India” - Hong Kong-based Finance Asia magazine

“Best Bank in India” - Euromoney magazine

We understand your world “300 Best Small Companies one of the ‘20 for 2001’ best FE-E&Y

Best Banks small companies - Forbes Global

“Awards for Corporate Excellence as the Emerging Company of the Year” - The Economic Times


“India 's Best Bank” - Business India

“Best Domestic Commercial Bank – India” - Hong Kong-based Finance Asia magazine

“Best Private Sector Bank” - Business Today


HDFC BANK – SWOT ANALYSIS

STRENGTHS: HDFC Bank has strong brand equity.

HDFC Bank has the second largest number of linked branches in the country and also has the most advanced data warehouse. The total numbers of branches of the Bank were 535 at the end of March 2006 as against only 312 at the end of March 2004. This provides a competitive edge over the competitors.

The quality of HDFC Bank product portfolio is excellent.

The company has a strong and rich infrastructure to support its working which include a strong technological base.

It has a highly skilled workforce, which gives a competitive advantage over others.

HDFC Bank is strongly positioned as a collecting bank in the IPO market.

The Bank has registered a strong deposit growth. During 2005-06, total deposits increased by 55.4 supported by an increase of 67.4% in savings deposits.

WEAKNESSES: A weak network of ATMs in comparison to its main competitors, especially

ICICI Bank, UTI Bank and State Bank of India.

Being not a Nationalized Bank general customers are found reluctant in Banking with this bank, as also in other private sector banks.

Business per employee in the HDFC Bank at Rs. 778 lacs, although higher than IDBI Bank and ICICI Bank, was lower than UTI Bank (Rs. 896 lacs) and IndusInd Bank (Rs. 1,588 lacs).


Operating Expenses as percentage of total assets have been higher for the HDFC Bank as compared to some of its competitors.

OPPORTUNITIES: With emphasis on core values such as customers focus, operating excellence,

product leadership and the people, along with open and transparent work culture, the HDFC Bank has a bright future.

Since HDFC Bank has invested in technology right from its inception. Its technology platform has been acknowledged as one of the best in terms of robustness, flexibility and cost efficiency. This would help the bank to further build cost and service advantage and compete not only with other private sector banks but also with foreign banks those who are opening more and more branches in India.

The Bank has infused the philosophy of Corporate Governance in all its activities. The philosophy would help the bank to move further towards shareholder protection and maximization of their long-term values.

Being customer becoming more service oriented could open up new avenues of growth for the Bank.

In case of future advancement HDFC is well placed to capitalize on any such opportunities.

THREATS: The company is facing tough competition from players like SBI, ICICI Bank and

UTI Bank itself. This might reduce the margins in the future.

The company is foraying into fields where they don’t have experience of operations and might end up deteriorating the quality of the assets. This remains a key threat in the fast changing global scenario.

In a mad race for expanding retail lending, especially in housing and auto loans, banks are laying less emphasis on collaterals. This is likely to increase the risk of defaults for banks including HDFC Bank.


OVERVIEW OF BANKING SECTOR

Banking Stands For

Banking refers to the business of accepting deposits and lending money. The deposits are repayable on demand and withdrawal by cheque or draft.

Meaning of Banking Company

According to Section 5 of Banking Regulation Act, 1949, “A Banking Company means any company which transacts the business of banking. Banking means the accepting for the purpose of lending or investment, or deposits of money from the public, payable on demand or otherwise and withdrawal by cheque, draft or otherwise”.Popularly, banking company is called a bank or banker.Now a day, in addition to acceptance of deposits, the bank provides various other services like safe custody of valuables, remittance of funds etc. Thus, a bank may define as institution, which is engaged in accepting deposits, providing loans and other services to its customers and the general public.

BANKING IN INDIA: - A Historical Perspective

Indian banks have a chequered history. The British legacy left behind a host of large and small private banks that were not quite professional in their approach. India at Independence was under-banked. Bank of Hindustan, set up in 1870, was the earliest Indian Bank. Banking in India on modern lines started with the establishment of three presidency banks under Presidency Bank’s Act 1876 i.e. Bank of Calcutta, Bank of Bombay and Bank of Madras. In 1921, all presidency banks were amalgamated to form the Imperial Bank of India. Imperial Bank carried out limited central banking functions also prior to establishment of RBI. It engaged in all types of commercial banking business except dealing in foreign exchange.

We understand your worldReserve Bank of India Act was passed in 1934 and Reserve Bank of India (RBI)

was constituted as an apex bank without major government ownership. Banking Regulations Act was passed in 1949. This regulation brought Reserve Bank of India under government control. Under the act, RBI got wide ranging powers for supervision

and control of banks. The Act also vested licensing powers and the authority to conduct inspections in RBI.

In 1955, RBI acquired control of the Imperial Bank of India, which was renamed as State Bank of India (SBI). In 1959, SBI took over control of eight private banks floated in the erstwhile princely states, making them as its 100% subsidiaries.

RBI was empowered in 1960, to force compulsory merger of weak banks with the strong ones. The total number of banks was thus reduced from 566 in 1951 to 85 in 1969. In July 1969, government nationalized 14 banks having deposits of Rs. 50 crores and above. In 1980, government acquired 6 more banks with deposits of more than Rs. 200 crores. Nationalization of banks was to make them play the role of catalytic agents for economic growth. The Narsimham Committee report suggested wide ranging reforms for the banking sector in 1992 to introduce internationally accepted banking practices. The amendment of Banking Regulation Act in 1993 saw the entry of new private sector banks.


PREFACE

HDC Bank has been promoted by Housing Development Finance Corporation (HDFC), India’s premier housing finance company. The Housing Development Finance Corporation Limited (HDFC) was amongst the first to receive an ‘in principle’ approval from the Reserve Bank of India (RBI) to set up a bank in the private sector, as part of the RBI’s liberalization of the Indian Banking Industry. In August1994, the bank was incorporated in the name of ‘HDFC Bank Limited’ with its registered office in Mumbai. The bank commenced its operation as a Scheduled Commercial Bank in January 1995.

In financial year 2002, the bank issued ADRs amounting to US $ 172.5 mn at the issue price of US $ 13.83 per share (1ADR = 3 equity shares) at the New York Stock Exchange.

Liberalization and reforms have thrown up a few challenges as well as created opportunities for banks to increase revenues by diversifying into investment banking, insurance, credit cards, mortgage financing, retail financing, depository services and more. With the emergence of e-commerce, the way in which banking business is presently conducted would undergo a radical change. Future competition among banks will be essentially based on the twin platforms of technology savviness and ability to attract talent. Telephone and internet banking will gain importance and the future will see the emergence of internet driven operations without a broad-based branch network. Increasing competition will exert pressure on bottom line, forcing banks to cope with thinning margins. It is looking for both organic and inorganic growth.

The year 2006 has witnessed rapid changes in the banking sector with a rather strong and aggressive presence of private sector Indian banks. These new banks have taken a sizable amount of business away from the public sector as well as the foreign banks. This new crop of banks has been leveraging technology to its advantage to rope in new business and create a sizable presence in this sector. The gradual deregulation of the sector has been increased presence of such banks in almost all sectors that warrant their services. The decrease in the small savings interest rates by the Government has been the strongest incentive for this sector to attract new client. But on the other hand, the lower growth in the economy of around 7.2% (initial target was 8%) has also affected the banking sector.


Future Scenario: With most of the banks, including the private sector ones fast adopting the latest technologies in banking, the early bird advantage of technological superiority will soon fade away. With most banks providing almost all services under the sun and the real potential of the retail market now unfolding, most banks operating on similar lines are expected to exhibit more than normal rates of growth in the short term. In the long

term, the differentiating factor will be the ability of these banks to retain their customer base at affordable margins both to itself as well as its client.

HDFC Bank emphasizes a lot on quality control. It has become the first bank in India to get ISO 9001:2000 certification for depository services at the Central Processing Unit and backend processing of retail liabilities and direct banking operations. The bank also has ISO 9001:2000 certification for Custodial services.

My task during the summer training was concerned with taking feedback regarding customer awareness of the Classic Portfolio Programme. I had study the market and analyze the prospective customers who might not still aware of the classic programme.

I tried to know the preferences of the customer and did analyze the same with other private banks. I thoroughly explored the market and have examined the factors influencing the present and future prospects of HDFC Bank.


GROUP MEMBERS

http://www.hdfcrealty.com/

http://www.cibil.com/

http://www.intelenetglobal.com/

http://www.hdfcfund.com/

http://www.hdfcsec.com/

http://www.hdfcbank.com/


CREDIT RATINGHDFC Bank has its deposit programs rated by two rating agencies - Credit Analysis & Research Limited (CARE) and Fitch Ratings India Private Limited. The Bank's Fixed Deposit programme has been rated 'CARE AAA (FD)' [Triple A] by CARE, which represents instruments considered to be "of the best quality, carrying negligible investment risk". CARE has also rated the Bank's Certificate of Deposit (CD) programme "PR 1+" which represents "superior capacity for repayment of short term promissory obligations". Fitch Ratings India Pvt. Ltd. (100% subsidiary of Fitch Inc.) has assigned the "tAAA (ind r)" rating to the Bank's deposit programme, with the outlook on the rating as "stable". This rating indicates "highest credit quality" where "protection factors are very high".

HDFC Bank also has its long term unsecured, subordinated (Tier II) Bonds of Rs.4 billion rated by CARE and Fitch Ratings India Private Limited. CARE has assigned the rating of "CARE AAA" for the Tier II Bonds while Fitch Ratings India Pvt. Ltd. has assigned the rating "AAA (ind)" with the outlook on the rating as "stable". In each of the cases referred to above, the ratings awarded were the highest assigned by the rating agency for those instruments.

Corporate Governance Rating

The bank was one of the first four companies, which subjected itself to a Corporate Governance and Value Creation (GVC) rating by the rating agency, The Credit Rating Information Services of India Limited (CRISIL). The rating provides an independent assessment of an entity's current performance and an expectation on its "balanced value creation and corporate governance practices" in future. The bank has been assigned a 'CRISIL GVC Level 1' rating which indicates that the bank's capability with respect to wealth creation for all its stakeholders while adopting sound corporate governance practices is the highest.


MAIN COMPETITORS

HDFC Bank is one of the largest private bank in India, it has many competitors in the market on the way of its development. Still the bank has quite efficiently managed its competitors and paves the path of success in the following 10 years since its inception. The competitors are in the form of two categories like Private banks of India and Foreign banks of India

Private Banks of India:

ICICI BANK

UTI BANK

IDBI BANK

INDUSIND BANK

KOTAK MAHINDRA BANK

ING VYSYA BANK

Foreign Banks of India:

HSBC BANK

STANDARD CHARTERED BANK

CITI BANK



COMPOSITION OF HDFC BANK, GOLPARK BRANCH (KOLKATA)

.Branch office: HDFC Bank Ltd. Registered office: HDFC Bank House

132A, Dr. Meghnad Saha Sarani, Senepati Bapat Marg (Location: Golpark) Lower Parel, Kolkata – 700 029 Mumbai – 400 013 Ph: 033 2463 1385/ 2463 2041 Ph: 022 6652 1000

Branch Manager

Assistant Manager Relationship Manager Deputy Branch Manager

Authorized Personal Banker

Authorized Teller

Teller 1 Teller 2

Investment Relationship Manager

PB 1 PB 4PB 2 PB 3


“Investors are the backbone,Customers the heart and

Employees the soul of our Bank”

► Philosophy of HDFC Bank


DECLARATION

I hereby declare that the information presented in this Project Report is correct to the best of my knowledge. This project has not been published anywhere else.

SAYAN GANGULY

PGDBM – III SEMESTER M/11/91 [FINANCE]


ACKNOWLEDGEMENTNo gain without pains is a common saying. Gratitude is the hardest of emotion to express and often does not find adequate words to convey. Therefore, a Project Report is not an effort of a single person but it is a contributory effort of many hands and brains.

I am heartily grateful to the Almighty, whose blesses and grace helped me in competing the project, for they did not disposed what I proposed.

In this regard I would like to thank to Prof. Mukund Lal (Director General of SMS) and Mr. Neeraj Srivastav (DGM – Corporate Relations) for providing me an opportunity to do my summer training project in HDFC Bank.

Secondly, I would like to thank HDFC Bank for providing me information which is helped in making my project.

I am very thankful to Mr. Anindya Sundar Basu (RSM–HR–East) for providing me an opportunity to do my summer training project in HDFC Bank.

I would like to express my deep gratitude towards Mr. Harsha Dutta (Branch Manager) of HDFC Bank Golpark Branch, Kolkata, for his valuable guidance and co-operation.

I deeply acknowledge the interest and enthusiasm shown by all the Classic Portfolio Customers and other banks of Kolkata while filling up the questionnaire.

I would like to thank all other members of the branch for their efforts and also their co-operation in successful completion of my training.

I am indebted to Dr. D. S. Mishra (Senior Professor) SMS Varanasi, who helped me in completing my project work.

Lastly, I express my sincere gratitude towards my loving and caring parents who supported and guided me throughout my training period and helped me in successful completion of the project.


PART - I

CROSS SELLING TO CLASSICPORTFOLIO CUSTOMERS


INTRODUCTION

The Classic Portfolio was introduced in 2003 with a view to identifying customers with large CASA (Current Account and Savings Account) balances, who also had potential to grow.

The Classic Portfolio was relaunched as at 1st April 2005 to achieve the following four objectives:

To include a much larger base of customers and capture share of wallet. To consciously improve customers retention from these customers through cross

sales and enhanced liability balances. To provide a bundled offering in recognition of their existing relationship and to

further enhance it. To give PBs (Personal banker) greater ownership of these customers for whom

they are responsible.

Classic Banking Programme:The Classic banking has been centrally identified and raced to PBs since 2003. The logic behind creating this portfolio lay in identifying customers with large balances. It was felt that these customers offered high potential to enhance balances if they were proactively focused on by branches. Over the last couple of years, it has been observed that full justice has been done to the inherent potential of this portfolio offered since it was viewed as a “glorified database”. To correct this, it was “Structured” Programme needed to be evolved.

While not enlisting as a Preferred Customer, it is widely believed that we need to include customers on the Classic Portfolio in a more structured relationship programme, managed by PBs.

Objective of Classic Portfolio Programme:

Retaining existing base of relationships Be primary banker to these relationships Cross sell products and services

We understand your world Capture share of wallet via Family relationship Mature the relationships to upgrade to Preferred Programme Enhance customer profitability

Eligibility for entry into the Classic Banking Programme:To be eligible for the Classic Banking Programme the following criteria has to be met

Retail Resident Individual. 1 SA account under customer ID is mandatory. CASA AQB => Rs. 5 lacs at a customer ID/group level, with at least 1 savings

account (Tenor of FD is recommended to be at least 6 months). In addition to the above, group profitability to be Bands 4 or 5.

Exclusive Benefits available to Classic Customers:The following benefits will be available to all Classic Banking Programme customers

All Classic Banking Programme customers will have a dedicated Personal Banker (PB) to look after the relationship.

The PB will be available for servicing if the customer comes to the branch. The PB will call and keep in touch with the customer to fulfill all servicing needs

and to cross sell and deepen the relationship. Special price offs or discounts on products and services will be available to the

Classic Banking Programme customers as listed below.

Sr. No. Products Benefits1 Demat A/c All Classic customers can open multiple Demat

A/cs with first year annual folio maintenance charges waived.This waived is available even if all the Demat A/cs are linked I to a single SA A/c.This pricing is available subject to assets being deposited within the first month of opening the Demat A/cThe offer is applicable on all Demat A/cs opened after the customer is part of the PB programme.The FMC charges from second year onwards will reduce to Rs. 250 provided the customers transfers shares into the A/c within the 1st year.

2 HSL A/c Priced at Rs. 649 for registrationIf volume transacted is 205 lacs within 3 months

We understand your worldof A/c opening, the AOC will be credited in broking A/c

3 Credit Cards All Classic Portfolio customers can avail of a Titanium Credit Card by paying a one time fee of Rs. 750 or All Classic Portfolio customers can avail of a Gold Credit Card free for life

4 Forex Conversion rates on FX transactions can be improved up to 5 paise on card rates for both buy and sell

5 Debit Cards Normal Debit card annual fee of Rs. 100 will be waived for life (where life = the duration the customer is part of the Classic Portfolio)

6 Lockers Annual Locker rental rates will be reduced by 25% for these customers

7 Combined Monthly Statement

All customers will receive a combined statement at a monthly frequency. The statement will provide details of all CASA and FD A/cs where the customers is the 1st holder

8 Bill Pay Bill Pay charges of Rs. 25 per annum will be waived for these customers as long as they are part of the Classic portfolio

9 Insta Alert Insta Alert charges will be waived for these customers as long as they are part of the Classic portfolio

10 Assets Classic portfolio customers will get reduced pricing on Asset product

11 Service charges (Non Maintenance of AQB charges)

Charges on non maintenance of AQB will be waived for all A/c of the Classic portfolio customers


PB Portfolio Programme Entry Form:HDFC Bank uses a particular form to enlist the existing customer’s name into the Portfolio Programme. The exact form is shown below which the bank uses for raising its customer’s name.

PB Portfolio Programme Entry Form

PB Code: Br Code: BR Name:

* Group ID: Name of Primary ID in Relationship:

(* Note: Group ID should be the cust of the Primary ID)

Sr. No. Cust ID Name of Customer Relationship to Group ID123456789101112131413

- Is this a new group? Yes No- Is this an addition to an existing group? Yes No- Is this regrouping of an existing group? Yes No- Is this a change in PB codes? Yes No- If yes, is current PB approval attached? Yes No- Is this an upgrade from Family a/c to PB Portfolio? Yes No- If yes, is Family a/c Exit Form attached? Yes No- Does this group meet eligibility criteria? Yes No- If no, is RBM approval attached? Yes No- Is there > 10 IDs being grouped? Yes No- If yes, is RBM approval attached? Yes No

Signature of PB:_______________________________

Signature of BM:_______________________________

Date:_____________________________

PB Name:________________________

BM Name:_______________________

For office Use only – CPU Activity

PB Code update YesGroup ID Maintained YesEthnic code maintained YesCombined statement flag maintained YesPB Portfolio Memo maintained Yes


RESEARCH OBJECTIVES The objectives of the project are enumerated as below:

To find out the Awareness of Classic Portfolio Programme among the customers regarding facilities provided by the bank

To gauge the level of service offered by the bank and degree of satisfaction among the customers

To find out different issues of the customers relating to their investment and in which scheme they have invested more

To evaluate the percentage of banking by the customers with HDFC Bank

To derive the need of additional products by the customers


RESEARCH METHODOLOGY

Research Problem:

The research problem was to find out Awareness of Classic Portfolio Programme among customers regarding facilities provided by the banks.

Type of Research:

The research conducted was descriptive in nature.

Sample Technique:

Simple Random Sampling.

Area Selected for research:

The survey was conducted on classic customers at the Kolkata city.

Sampling Units:

Each respondent was considered as a single unit in the survey

.

Sample size:

The sampling was done taking 200 units of the universe i.e., taking the total PB Classic Portfolio customers of HDFC Bank

Collection Of Data:

We understand your worldThe data that is used for this project is primary data i.e., first hand data is used. The method used for collection of data is through questionnaire method. The questions were asked related to the problems and feedback was received

LIMITATIONSSome limitations are being faced during the survey was conducted. The limitations are listed as:

Due to time and money constraints during Summer Training I could not complete the survey on total classic portfolio customers of 1300

Cancellation of an appointment with the customers on a particular day due to their time constraints is one of the limitations faced during the survey

Some customers are unwilling to give any appointment or speak over the telephone

Some customers stays abroad. It is not even possible to contact them over telephone or meet them personally. When contacted through email by sending the feedback form but didn’t get any reply.


FINDINGS &INTERPRETATION

1. Customers having products of HDFC Bank

Savings A/c

Current A/c

Fixed Deposit

Credit Card

Mutual Funds

Insurance Locker Loan NRE & NRO A/c

Others

No. of Customers Responded

200 200 200 200 200 200 200 200 200 200

% of Customers having the products

100% 2% 18% 16% 10% 13% 3% 6% 4% 10%

Interpretation

The above table exhibits that with 200 responded customers, all of them are having Savings A/c. Apart from this the customers are also having other products offered by HDFC Bank.

Only 2% of 200 prospective customers are having the Current A/c.

Fixed Deposit counts to 18%. The percentage of holding credit cards among Classic

customers is 16%. 10% of them have invested in Mutual Fund through HDFC

Bank. 13% have done their Insurance in HDFC Standard Life. Out of 200, only 3% customers are availing the locker facility.

We understand your world In loan segment, 6% respondents have taken loan through

HDFC Bank. The percentage of having NRE & NRO A/c in HDFC Bank is only

4% out of 200 responded customers. In others product (which includes SIP, Demat A/c, On Line

Trading A/c, Bill Pay, Intra Alert) are having customers of only 10%.

2. Awareness of Classic Portfolio Programme among the customers

Options No. of Customers Percentage

Yes 90 45%

No 110 55%

Total 200 100%

Interpretation

We understand your worldThe diagram shows that the awareness of Classic Portfolio Programme among the eligible customers is very less. Only 45% (out of 200) responded customers said that they are fully aware of the above-mentioned programme. But 55% customers replied that they do not know about classic programme.

3. Awareness of facilities provided under Classic Portfolio Programme


Yes 80 40%

No 120 60%

Total 200 100%

Interpretation

As the awareness of the Classic Programme is less among the responded customers, its obvious that facilities provided by the bank under this programme would be unknown to them. Only 40% said they

Awareness of Facilities

Yes40%

No60%

We understand your worldare aware of the facilities, which they are enjoying under this programme and 60% replied no.

4. Customer’s Satisfaction Level regarding service of HDFC Bank


Absolutely 70 35%

Relatively 100 50%

Somewhat 20 10%

Not at all 10 5%

Total 200 100%

Interpretation


Regarding the customer’s satisfaction level about the service rendered by HDFC Bank, the graph represents that half of the respondents are relatively satisfied; only 35% said they are absolutely satisfied with the service; while 10% replied somewhat due to personal reasons.

5. Investment made through HDFC Bank


Yes 60 30%

No 140 70%

Total 200 100%

Interpretation

The above diagram shows that out of 200 responded customers only 30% have made their investment through HDFC Bank in different schemes. But 70% of them have not invested through this bank.

30

70

0 20 40 60 80

No. of Respondents in %

Yes

No

Investment made through HDFC Bank

We understand your worldReasons:

1. Not aware of HDFC investment service option.

2. Other banks approached the customers much earlier than PB of HDFC Bank does and these banks rendered good customized service and support after their investment.

3. Most of the customers have invested through their personal agent and they offer valuable incentives in return.

4. Some financial institutions also offers brokerage cost at lower level.

5. Getting direct online trading options from other banks.

6. Some customers are Priority banking customers of other banks and their any kind of activities are handled from home and office with the help of bank representative.

7. Invested before opening an Account with HDFC Bank.

8. Customers investing in LIC feel that their investment is much more reliable and secured in according to Insurance sector.


6. Invested In


Mutual Funds 20 10%

Insurance 25 13%

SIP 15 7%

Total 60 30%

Interpretation

As it has been already shown that only 30% of the respondents have made their investment through HDFC Bank. Accordingly, the graph exhibits that out of 30% customers - 13% have invested in different plans of Insurance; 10% and 7% invested in diversified schemes of Mutual Fund and SIP respectively.

7. Customer invested in different schemes through HDFC Bank

10

13

7

0

24

6

810

12

14

1


Invested In

MutualFund

Insurance

SIP

We understand your worldMUTUAL FUNDS

INSURANCE SIP

Tata Tata Infrastructure Fund, Tata Contra Fund

Sundaram*Sundaram Select Midcap Fund, Sundaram Rural India Fund

*Sundaram Select Midcap Fund

SBI SBI Magnum Comma Fund

KotakKotak Opportunities Fund, Kotak Midcap Fund

HSBC

HSBC Equity Fund, *HSBC Advantage India Fund, *HSBC India Opportunities Fund, HSBC Gilt Fund, HSBC Midcap Equity Fund

*HSBC Advantage India Fund

HDFC

*HDFC Equity Fund, *HDFC TOP 200 Fund, HDFC Core & Satellite Fund

*HDFC Unit Linked Endowment Plan, *HDFC Pension Plan, Accident Insurance Plan, HDFC CHUBB

*HDFC Equity Fund, *HDFC TOP 200 Fund

ABN AMRO

Franklin TempletonFT India Balanced Fund, Franklin India Opportunities Fund

Prudential ICICI

*Prudential ICICI Emerging Star Fund, Prudential ICICI Infrastructure Fund

*Prudential ICICI Dynamic Fund, Prudential ICICI Power Fund, *Prudential ICICI Emerging Star Fund

Reliance*Reliance Growth Fund, Reliance Equity Fund, Reliance Vision fund

*Reliance Growth Fund

UTI UTI Infrastructure FundIDBI IDBI Flexi Bond

DSP Merrill Lynch*DSPML TIGER Fund, DSPML Opportunities Fund

*DSP Merrill Lynch TIGER Fund

Birla Birla Advantage Fund Birla Sun Life

Endowment & pension Plan

Fidelity Fidelity Equity FundDeutscheING VysyaStandard Chartered

Note: * indicates that percentages of investment among customers are more

8. Invested through other Financial Institutions or Banks



LICI 22 11%

UTI Bank 15 7%

ICICI Bank & icicidirect.com 32 16%

Kotak Securities 9 5%

Indiabulls 8 4%

Sharekhan 4 2%

Personal Agent 42 21%

Post Office (MIS) 8 4%

Total 140 70%

Interpretation

The percentage of investment made through others apart form HDFC Bank is 70%. Out of these, customers prefer most through their Personal Agent, ICICI Bank & icicidirect.com and to put money in LICI.

9. Customers dealing with other banks apart from HDFC Bank

117

16

5 42

21

4

0

5

10

15

20

25

1


Invested through others

LICI UTI BankICICI Bank & icicidirect.com Kotak SecuritiesIndiabulls SharekhanPersonal Agent Post Office (MIS)


Private Banks in India % of Dealing

Bank of Rajasthan

Bharat Overseas Bank 5%

Catholic Syrian Bank

Centurion Bank of Punjab

Dhanalakshmi Bank

Federal Bank 5%

ICICI Bank 35%

IDBI Bank 10%

IndusInd Bank 5%

ING Vysya Bank 5%

Jammu & Kashmir Bank

Karnataka Bank

Karur Vysya Bank

Kotak Mahindra Bank 10%

SBI Commercial and

International Bank

South Indian Bank

United Western Bank

UTI Bank 20%

YES Bank 5%

Foreign Banks in India % of Dealing

ABN-AMRO Bank 5%

Abu Dhabi Commercial Bank

Ltd.

American Express Bank Ltd

BNP Paribas

Citibank 20%

DBS Bank Ltd

Deutsche Bank 5%

HSBC Ltd 30%

Standard Chartered Bank 40%

Interpretation

Nationalized Banks in India

% of Dealing

Allahabad Bank 5%

Andhra Bank

Bank of Baroda 5%

Bank of India 5%

Bank of Maharashtra

Canara Bank 2%

Central Bank of India 5%

Corporation Bank 5%

Dena Bank

Indian Bank 2%

Indian Overseas Bank 5%

Oriental Bank of Commerce

Punjab and Sind Bank

Punjab National Bank 5%

State Bank of Bikaner & Jaipur

State Bank of Hyderabad

State Bank of India (SBI) 40%

State Bank of Indore

State Bank of Mysore 4%

State Bank of Patiala

State Bank of Saurashtra

State Bank of Travancore

Syndicate Bank 1%

UCO Bank 1%

Union Bank of India

United Bank of India 15%

Vijaya Bank

http://www.iloveindia.com/finance/bank/foreign-banks/standard-chartered-bank.html

http://www.iloveindia.com/finance/bank/foreign-banks/hsbc-bank.html

http://www.iloveindia.com/finance/bank/foreign-banks/deutsche-bank.html

http://www.iloveindia.com/finance/bank/foreign-banks/dbs-bank.html

http://www.iloveindia.com/finance/bank/foreign-banks/citibank.html

http://www.iloveindia.com/finance/bank/foreign-banks/bnp-paribas.html

http://www.iloveindia.com/finance/bank/foreign-banks/american-express-bank.html

http://www.iloveindia.com/finance/bank/foreign-banks/abu-dhabi-commercial-bank.html

http://www.iloveindia.com/finance/bank/foreign-banks/abu-dhabi-commercial-bank.html

http://www.iloveindia.com/finance/bank/foreign-banks/abn-amro-bank.html

http://www.iloveindia.com/finance/bank/private-banks/yes-bank.html

http://www.iloveindia.com/finance/bank/private-banks/uti-bank.html

http://www.iloveindia.com/finance/bank/private-banks/united-western-bank.html

http://www.iloveindia.com/finance/bank/private-banks/south-indian-bank.html

http://www.iloveindia.com/finance/bank/private-banks/sbi-commercial-and-international-bank.html

http://www.iloveindia.com/finance/bank/private-banks/sbi-commercial-and-international-bank.html

http://www.iloveindia.com/finance/bank/private-banks/kotak-mahindra-bank.html

http://www.iloveindia.com/finance/bank/private-banks/karur-vysya-bank.html

http://www.iloveindia.com/finance/bank/private-banks/karnataka-bank.html

http://www.iloveindia.com/finance/bank/private-banks/jammu-and-kashmir-bank.html

http://www.iloveindia.com/finance/bank/private-banks/ing-vysya-bank.html

http://www.iloveindia.com/finance/bank/private-banks/indusind-bank.html

http://www.iloveindia.com/finance/bank/private-banks/idbi-bank.html

http://www.iloveindia.com/finance/bank/private-banks/icici-bank.html

http://www.iloveindia.com/finance/bank/private-banks/federal-bank.html

http://www.iloveindia.com/finance/bank/private-banks/dhanalakshmi-bank.html

http://www.iloveindia.com/finance/bank/private-banks/centurion-bank-of-punjab.html

http://www.iloveindia.com/finance/bank/private-banks/catholic-syrian-bank.html

http://www.iloveindia.com/finance/bank/private-banks/bharat-overseas-bank.html

http://www.iloveindia.com/finance/bank/private-banks/bank-of-rajasthan.html

http://www.iloveindia.com/finance/bank/nationalised-banks/vijaya-bank.html

http://www.iloveindia.com/finance/bank/nationalised-banks/united-bank-of-india.html

http://www.iloveindia.com/finance/bank/nationalised-banks/union-bank-of-india.html

http://www.iloveindia.com/finance/bank/nationalised-banks/uco-bank.html

http://www.iloveindia.com/finance/bank/nationalised-banks/syndicate-bank.html

http://www.iloveindia.com/finance/bank/nationalised-banks/state-bank-of-travancore.html

http://www.iloveindia.com/finance/bank/nationalised-banks/state-bank-of-saurashtra.html

http://www.iloveindia.com/finance/bank/nationalised-banks/state-bank-of-patiala.html

http://www.iloveindia.com/finance/bank/nationalised-banks/state-bank-of-mysore.html

http://www.iloveindia.com/finance/bank/nationalised-banks/state-bank-of-indore.html

http://www.iloveindia.com/finance/bank/nationalised-banks/state-bank-of-india.html

http://www.iloveindia.com/finance/bank/nationalised-banks/state-bank-of-hyderabad.html

http://www.iloveindia.com/finance/bank/nationalised-banks/state-bank-of-bikaner-and-jaipur.html

http://www.iloveindia.com/finance/bank/nationalised-banks/punjab-national-bank.html

http://www.iloveindia.com/finance/bank/nationalised-banks/punjab-&-sind-bank.html

http://www.iloveindia.com/finance/bank/nationalised-banks/oriental-bank-of-commerce.html

http://www.iloveindia.com/finance/bank/nationalised-banks/indian-overseas-bank.html

http://www.iloveindia.com/finance/bank/nationalised-banks/indian-bank.html

http://www.iloveindia.com/finance/bank/nationalised-banks/dena-bank.html

http://www.iloveindia.com/finance/bank/nationalised-banks/corporation-bank.html

http://www.iloveindia.com/finance/bank/nationalised-banks/central-bank-of-india.html

http://www.iloveindia.com/finance/bank/nationalised-banks/canara-bank.html

http://www.iloveindia.com/finance/bank/nationalised-banks/bank-of-maharashtra.html

http://www.iloveindia.com/finance/bank/nationalised-banks/bank-of-india.html

http://www.iloveindia.com/finance/bank/nationalised-banks/bank-of-baroda.html

http://www.iloveindia.com/finance/bank/nationalised-banks/andhra-bank.html

http://www.iloveindia.com/finance/bank/nationalised-banks/allahabad-bank.html


These are the following banks in which the customers are dealing with their seed capital apart from HDFC Bank. The banks are being segregated into three different types according their nature

1. Nationalized Banks of India

2. Private Banks in India

3. Foreign Banks in India

The percentage has been calculated differently on three different types of banks as because customers banking with Private or Foreign banks might have an Account in Nationalized banks also.

From the above chart it can be assumed that major percentages of customers are dealing with State Bank of India in Nationalized Banking Segment; with ICICI Bank in Private Banking Segment and with Standard Chartered Bank in Foreign Banking Segment.

10. Products of other banks

Savings A/c

Current A/c

Fixed Deposit

Credit Card

Mutual Funds

Insurance Locker Loan NRE &

Others

We understand your worldNRO A/c

No. of Customers Responded

200 200 200 200 200 200 200 200 200 200

% of Customers having the products

85% 10% 30% 30% 10% 5% 20% 8% 5% 6%

Interpretation

As the customers are dealing with other banks apart from HDFC Bank, these are the following products offered by those banks and accordingly shown the percentage of holding the various products of these 200 responded customers.

11. Reasons for availing the facilities


Reasons for availing the facilities

18%

35%14%

15%

10%5% 3% Good Customized

ServicesOld Accounts

Convenience

Nearer to the house

Opened for Salary A/c

Equity Advance A/c

Unavailability of locker

We understand your worldGood customized services 36 18%

Old Accounts 70 35%

Convenience 28 14%

Nearer to the house 30 15%

Opened for Salary A/c 20 10%

Equity Advanced A/c 10 5%

Unavailability of locker 6 3%

Total 200 100%

Interpretation

The customers have depicted some important reasons of availing the aforementioned facilities from other banks. One of the important reasons is that they are maintaining an Old Account with other banks before becoming a customer of HDFC Bank.

12. Frequency of transaction of PB customers with other banks


Regularly 100 50%


Often 60 30%

Sometimes 30 15%

Occasionally 10 5%

Never 0 0%

Total 200 100%

Interpretation

Being a customer of other banks, obviously they will do their transaction regularly as 50% says yes. 30% and 15% replied often and sometimes respectively due to some constraints.

13. Customer enjoying extra benefits through other banks

Apart from the facilities providing by the HDFC Bank, the customers are also enjoying extra benefits while being a part of other banks. The benefits are enumerated as below:

50

30

15

50

0

10

20

30

40

50

Regularly Often Sometimes Occasionally Never

Frequency of transaction


Good personalized service

Takes care of the problems with helping hand by the bank representatives

Facility of saving money into bank through Recurring Deposit

Doorstep banking through easy availability of ATM of concerned bank

Unlimited withdrawal from other bank ATM without any withdrawal charges

Gets the facility of evening banking

Customers having an account with ICICI Bank gets banking hours from 8 a.m to 8 p.m

Getting the facility of Passbook instead of quarterly statement

UTI Bank provided the customers with total yearly interest credited statement separately

Provide At Par cheque for all kind of Savings A/c in UTI Bank

CONCLUSION


On 18th February, 1995, the first branch of a new bank was inaugurated called HDFC Bank. It was promoted by India's premier housing finance institution. Now HDFC Bank is being listed as one of the leading private banks in India.

HDFC Bank began its operations with the mission of becoming a World-class Indian Bank, and the endeavour of fulfilling all the financial requirements of the customers under one roof. With this determination HDFC Bank came into the market to satisfy the needs of the profitable customers by providing products and services in most efficient way. Within the time span of 10 years the bank has made a great impact upon the customers regarding their service and support they extended in enhancing the customers profitability and apart from this, bank itself marked its glorified path towards the success.

Within a short interval bank use used to experiment itself by introducing new product or new concept of marketing strategy. Recently they came up with an innovative concept of Classic Portfolio Programme under which the customers will be getting certain benefits to further enhance their profitability. Till, this programme has been really a triumph for the HDFC bank as far as the banking part is concerned and it also helped in creating a good image upon the customers.

SUGGESTIONS


Good relationships are pivotal to business success. With this organizational objective HDFC Bank tries to maintain a fine balance between high level of customer satisfaction and the quality of service provided by them but it lacks in some sense. These are the following suggestions that should be taken care of while upgrading the quality of service by which they can able penetrate more classic customers into portfolio management.

Suggestions and Recommendations:

The bank should take initiative in calling up the existing classic based customers and try to solve the problems that they are facing relating to the service quality.

Inspite of phenomenal success of “Classic Portfolio Programme” of HDFC bank, still lot of customers are unaware of the aforementioned programme and this should be taken care off in order to generate more profitable customers.

The bank must approach the customers personally in order to share

more of their seed capital.


PART - II

COMPARATIVE STUDY OF VARIOUS VALUE ADDED SERVICES PROVIDED BY HDFC BANK IN COMPARISON WITH OTHER BANKS


RESEARCH OBJECTIVE

The objective of the project is enumerated as below:

To get a comparative analysis of various value added services provided by HDFC in comparison to other Private Banks.


RESEARCH METHODOLOGY

Research Design:

The research conducted was analytical in nature.

Source Collection Of Data:

The data that is used for this project is secondary data. All the data are collected from internet and various banks report and records.


FINDINGS &INTERPRETATION

1. Total Branches in India

Options Total Branches

ICICI BANK 614UTI BANK 450HSBC BANK 43STANDARD CHARTERED BANK 81CITI BANK 39ING VYSYA BANK 374INDUSIND BANK 145IDBI BANK 179KOTAK MAHINDRA BANK 85HDFC BANK 535

Total Branches

614

450

43

81

39

374

145

179

85

535

0 200 400 600 800ICICI BANK

UTI BANK

HSBC BANK


CITI BANK

ING VYSYA BANK

INDUSIND BANK

IDBI BANK

KO TAK MAHINDRA BANK

HDFC BANK


2. Account Opening Experience

Options Time taken for account

opening

Time committed for receipt pf Welcome Kit

Account material received within

ICICI BANK 15 – 20 mins 7 days 7 daysUTI BANK 10 – 15 mins Less than 7 days 7 daysHSBC BANK 15 – 20 mins 7 days 7 daysSTANDARD CHARTERED BANK 15 – 20 mins 10 days Within 12 days

CITI BANK 15 – 20 mins 10 days 10 daysING VYSYA BANK 20 – 30 mins 10 days 15 daysINDUSIND BANK 10- 15 mins 7 days 7 daysIDBI BANK 15 – 20 mins 10 days 15 daysKOTAK MAHINDRA BANK 15 – 20 mins 10 days 10 daysHDFC BANK 7 – 10 mins 7 days 7 days

Interpretation

As the table shows that different banks have different timing schedule regarding the Account opening of the customers. HDFC Bank showed better service in regard to other banks in a manner that it takes 7 to 10 mins of initial Account opening and the customer receives the welcome kit within the committed time made the bank. While in UTI Bank & Standard Chartered Bank the customer does not receive the welcome kit within the committed time.


3. Service provided by Personal Banker

Options Does PB greets enthusiastically

& politely

PB area neat & clean with name plate

visible

PB response the queries satisfactorily

ICICI BANK 4 4 4UTI BANK 3 3 3HSBC BANK 5 5 5STANDARD CHARTERED BANK 5 5 5CITI BANK 5 5 4ING VYSYA BANK 3 3 3INDUSIND BANK 2 2 2IDBI BANK 3 3 3KOTAK MAHINDRA BANK 4 4 4HDFC BANK 5 4 4

Note: A parameter of 5 to 1 scale is being set to judge the level of effectiveness. 5 = Best, 3 = Average, 1 = Worst

Interpretation

To analyze the service rendered by the Personal Banker, a parameter of 5 to 1 scale is being set to judge the level of efficiency and effectiveness. The table exhibits that all the banks perform their duty with most efficient way to survive in this competitive world.

If comparison is made between Standard Chartered Bank, HSBC Bank and HDFC Bank; these two banks are much more professionalized than HDFC Bank in terms of service and on this part bank needs improvement.


4. Total ATMs in India

Options Total ATMs

ICICI BANK 2200UTI BANK 1891HSBC BANK 137STANDARD CHARTERED BANK 183CITI BANK 440ING VYSYA BANK 101INDUSIND BANK 200 + CorrespondenceIDBI BANK 395KOTAK MAHINDRA BANK 61 + CorrespondenceHDFC BANK 1323

5. Total Phone Banking Locations in India

0 500 1000 1500 2000 2500

ICICI BANKUTI BANK

HSBC BANKSTANDARD CHARTERED BANK

CITI BANKING VYSYA BANK

INDUSIND BANKIDBI BANK

KO TAK MAHINDRA BANKHDFC BANK

Total ATMs


Options Total Phone Banking LocationsICICI BANK 37

UTI BANK Localized No., but connecting directly to Mumbai

HSBC BANK 19STANDARD CHARTERED BANK 46CITI BANK 25ING VYSYA BANK 28INDUSIND BANK N/AIDBI BANK 48KOTAK MAHINDRA BANK Toll Free No. for North India & Rest of IndiaHDFC BANK 189

6. Net Banking Services

Options Ease of Connectivity

Range of Transaction

Requests action taken within

committed time

More effective than other Banks

ICICI BANK 4 4 3 3UTI BANK 4 4 4 4

Total Phone Banking Locations

37

119 25 28

0

48

2

189

46

020406080

100120140160180200

We understand your worldHSBC BANK 5 5 5 4STANDARD CHARTERED BANK 5 4 4 4CITI BANK 4 4 4 4ING VYSYA BANK 4 4 3 3INDUSIND BANK 3 3 3 3IDBI BANK 5 5 4 3KOTAK MAHINDRA BANK 5 5 4 4HDFC BANK 5 4 3 3


Interpretation

On the part of Net Banking service, the most efficient banks are HSBC Bank, IDBI Bank, and Kotak Mahindra Bank in comparison with HDFC BankA same parameter of scale is being used to judge to level of efficiency and effectiveness.

7. Mobile Banking Services

Options Ease of Connectivity

Range of Transaction

Requests action taken within committed time

ICICI BANK 5 5 4UTI BANK 3 3 3

We understand your worldHSBC BANK 5 4 5STANDARD CHARTERED BANK 4 4 4CITI BANK 5 4 4ING VYSYA BANK 4 4 4INDUSIND BANK N/A N/A N/AIDBI BANK 4 4 3KOTAK MAHINDRA BANK 4 3 3HDFC BANK 4 4 4


Interpretation

In Mobile Banking service, the above table shows that ICICI Bank, CITI Bank and HSBC Bank provide better service in compare to the service rendered by HDFC Bank.

A same parameter of scale is being used to judge to level of efficiency and effectiveness.

8. Extra Benefits given to the customers apart from other Banks

Options Benefits provided by the bank

ICICI BANK i) Money Multiplier A/cii) Largest network of ATMs in India

UTI BANKi) Providing Reward Card

We understand your worldii) Easy availability of ATM anywhere in India

HSBC BANKi) Customers taking loan can enjoy free Gold Credit Cardii) Free Home Bankingiii) HSBC Power Vintage A/c

STANDARD CHARTERED BANKi) Frequent meeting with customers in Five star hotelsii) Distributing gifts and giving privileges to profitable customers from time to time

CITI BANK i) Providing Citi Bank Jet Airways Gold Card

ING VYSYA BANKi) Free ATM transactions with any bank except UBIii) Providing loan at preferential rate for agricultural equipments

INDUSIND BANK i) Kingfisher Airlines tickets at discounted rates.ii) Mobile Top Up through ATM.

IDBI BANK

i) Special loan for financing IPOsii) Customer can open a Sabka A/c with minimum balance of Rs. 250iii) Providing World Currency Card for the tourists.

KOTAK MAHINDRA BANK i) Kotak Capital Multiplier Planii) Kotak Edge Savings A/c

HDFC BANK

i) Prepaid Refilling through ATMii) Providing RFC Domestic A/c to the customersiii) Express loaniv) Enhanced EquiAll service on demand

9. Promotional activities the bank usually does

Options Promotional Activities

Outdoor IndoorICICI BANK i) Sponsoring an event

ii) Giving Advertisement on i) Displaying informative posters on the wall

We understand your worldtelevision regarding banking information

UTI BANK i) Campaignii) Sponsorship

i) Hanging out the banners inside the bank premises

HSBC BANKi) Indulging in social activitiesii) Distributing gifts to the customers

i) Providing brouchers inside the bank


i) Sponsoring various eventsii) Do philanthropic activitiesiii) Distributing gifts to the customers

i) Informative posters hanging on the wall

CITI BANK

i) Contributing funds in Tsunami Tragedy Relief Fundii) Funding for primary education

i) Posters are being put on the wall of the bank premises and ATMs

ING VYSYA BANKi) Giving Advertisement on television regarding banking information

i) Providing brouchers on demand

INDUSIND BANK

i) Sponsoring social welfare organizing by NGOsii) Offer discount coupons on certain commodities

i) Various information posters are being displayed in front of Teller counter

IDBI BANK

i) Financed in Film industry to promote their Brand nameii) Giving Advertisement on television regarding banking information

i) Easy available of brouchers inside the bank

KOTAK MAHINDRA BANK i) Do philanthropic activities i) Displaying informative posters on the wall and ATMs

HDFC BANK

i) Giving Advertisement on television regarding bank informationii) Sponsoring various eventsiii) Offer discount coupons on certain commodities

i) Hanging out the various informative posters inside the bank premises specially in front of Teller counter

CONCLUSION

The Indian financial sector underwent a radical change during the nineties to the beginning of 21st century. From the relatively closed and regulated environment in which agents had to operate earlier, the sector was opened up


as part of the efficiency enhancing structural policies to bring about high sustainable long-term growth of the economy. The banking sector was also not an exception to this rule. More specifically private sector banks and foreign banks like ICICI Bank, UTI Bank, Standard Chartered Bank, HSBC Bank, HDFC Bank, CITI Bank etc differ significantly in performance, performance being measured in terms of profitability, efficiency in portfolio management and operating efficiency. The environment was made friendlier for domestic private sector and foreign banks too. As a result, many private players entered the banking sector giving rise to the heightened competitive pressure. Amongst them HDFC Bank showed its development in all respect immensely for the last ten years.

Being aware of the current economic environment is challenging, with persistent sluggishness in industrial production and an overall dampening of business confidence. The rapid dismantling of trade barriers, decline in several international commodity prices and intensifying global competition have exposed the Indian corporate sector to greater risk. In such an environment, HDFC Bank's growth have been driven by enhanced customer acquisition, geographic expansion and new product introductions as well as increased penetration of the existing customer base by enlisting on classic portfolio programme.

It could be believed that HDFC Bank is well positioned in this respect and should be able to achieve healthy growth in long run both in terms of business volumes and profitability.

BIBLIOGRAPHY

Research Methodology : C. R. Kothari.

Statistical Method : Dr. S. P. Gupta.


Financial Management : I. M. Pandey.

Journals : Annual Report of HDFC Bank (2005-06)Annual Report (2004-05).

Websites : www.google.co.in www.hdfcbank.comwww.hsbc.co.inwww.standardchartered.co.inwww.idbibank.comwww.icicibank.comwww.kotakmahindrabank.comwww.citibank.co.inwww.ingvysyabank.comwww.indusindbank.comwww.utibank.comwww.information.com

ANALYSIS OF THE FINDINGS Awareness of Classic Portfolio Programme among the customers is

very low which counts only 45% and 40% of the respondent knows about the facilities provided by the bank under this programme.

http://www.indusindbank.com/

http://www.ingvysyabank.com/

http://www.citibank.co.in/

http://www.kotakmahindrabank.com/

http://www.icicibank.com/

http://www.idbibank.com/

http://www.standardchartered.co.in/


50% of the customers are relatively satisfied with the service rendered by HDFC Bank.

About 70% of the Classic customers did not invest their money through HDFC Bank due to some reasons.

Maximum customers have invested their seed capital through other financial institutions like LICI, Indiabulls, Post Office (MIS) and Sharekhan etc.

The Classic Portfolio customers are also having their account with other Banks due to following reasons like old account, opened for salary a/c, good customized services, nearer to the house etc.

ANALYSIS OF THE FINDINGS Regarding the total Branches in India, HDFC Bank is in the second

position (535 branches) among these ten private banks. The first position is occupied by ICICI Bank with total branches of 614.


HDFC Bank showed a better service regarding account opening as it takes 7-10 mins for initial account opening and customers received the welcome kit within the committed time.

In total ATMs in India, ICICI Bank and UTI Bank leads the way whereas HDFC Bank ranked as third position.

In total Phone Banking in India, HDFC Bank clearly leads the position with 189 phone banking locations and the second position is occupied by IDBI Bank.

CONTENTS

Chapter: 1


Overview of Banking Sector

Chapter: 2

HDFC Bank a. Historical Preludeb. Group Membersc. Organizational Structure

i. Composition of HDFC Bank, Golpark Branch (Kolkata)d. Management Stylee. Distribution Networkf. Capital Structureg. Mission and Business Strategyh. Technologyi. Risk Management and Portfolio Qualityj. Human Resourcesk. Segmentation Informationl. Products and Marketm. Main Competitors

Chapter: 3

HDFC Bank – Operations a. Business Segment Updateb. Financial Highlights

Chapter:4

Achievements a. Credit Rating

Chapter: 5

HDFC Bank – SWOT Analysis a. Strengthsb. Weaknessesc. Opportunities

We understand your worldd. Threats

Chapter:6

Portfolio Penetration Of HDFC Bank A. Part I: Cross Selling to Classic Portfolio Customers

a. Introduction b. Research Objectivesc. Research Methodologyd. Findings and Interpretatione. Analysis of the findingsf. Limitationsg. Conclusionh. Suggestions

B. Part II: Comparative Study of Various Value Added Services provided by HDFC Bank in comparison with Other Banks

a. Research Objectivesb. Research Methodologyc. Findings and Interpretationd. Analysis of the findingse. Conclusion

Chapter: 7

Annexure

Chapter: 8

Bibliography

QUESTIONNAIRE FOR THE CUSTOMERS


Name:Customer ID:

Please mark (√) where applicable:

1. What products of HDFC Bank are you availing?

i) Savings A/c ii) Current A/c iii) Fixed Deposit

iv) Credit Card v) Mutual Fund vi) Insurance

vii) Lockers viii) Loan ix) NRE & NRO A/c

2. Are you aware that you have been enlisted as a classic portfolio customer of our bank?

i) Yes ii) No

3. Being a classic portfolio customer, are you aware of the facilities that our bank is providing?

i) Yes ii) NoFacilities:[Free Gold Credit Card, Free International Debit card, reduced charges for lockers and demat A/c, opening Zero Balance A/c for your family members, better Forex rates, preferencial loan rates, personalized investment advice and services.]

4. Are you satisfied with the service that our bank is providing?

i) Absolutely ii) Relatively iii) Somewhat iv) Not at all.

5. Have you ever invested through HDFC Bank?

i) Yes ii) No

Invested In Yes/No SchemesMutual FundsInsuranceSIP

6. Any means of investment you did through others financial institutions apart from HDFC Bank?

………………………………….....................................................................................................

…………………………………………………………………………………………………….

7. Why?

Reason:……………………………………………………………………………………………

We understand your world 8. Apart from HDFC Bank what other banks are you dealing with?

i) ii) iii) iv)

9. What products of other banks are you having?

i) Savings A/c ii) Current A/c iii) Fixed Deposit

iv) Credit Card v) Mutual Fund vi) Insurance

vii) Lockers viii) Loan ix) NRE & NRO A/c

10. Why do you avail the aforementioned products from other banks?

Reason:…………………………………………………………………………………………..

11. How often you do your transaction with other banks?

i) Regularly ii) Often iii) Sometimes iv) Occasionally v) Never.

12. What extra benefits are you getting while being a customer of other banks?

i) ii) iii) iv)

Documents

HDFC Financial Analysis & Marketing Research