Irp Report 2020 - Seniors
Irp Report 2020 - Seniors
Dr. Vanishree M. R
Associate Professor
BANGALORE- 560029
2020
DECLARATION
We, Jaanvi Asoodani, Ishika Chowdhary and Shubham Earla hereby declare that the Industry
Review Project Report, submitted to CHRIST (Deemed to be University), in partial fulfilment of
the requirements for the award of the Degree of Bachelor of Business Administration is a record
of the Industry Analysis done by us during 2020-21 under the supervision and guidance of Dr.
Vanishree M R School of Business and Management, CHRIST (Deemed to be University).
Place: Bangalore
Date: 25/11/2020
CERTIFICATE
This is to certify that Jaanvi Asoodani, Register No 1920565, Ishika Chowdhary, Register No
1920537 and Shubham Earla, Register No 1920527, is a bona fide student of Bachelor of Business
Administration Program studying in Christ (Deemed to be University). He/she has prepared and
submitted Industry Review Project completed titled “Banking Industry”, in partial fulfilment of
the requirement for the award of Degree of Bachelor of Business Administration Program of
CHRIST (Deemed to be University), for the Academic Year 2020-21.
Place: Bangalore
This is to certify that the industry review project report, submitted to CHRIST, (Deemed to be
University) in partial fulfillment of the requirements for the award of the Degree of Bachelor of
Business Administration Program of CHRIST (Deemed to be University), is a record of the
industry study done by Jaanvi Asoodani, Ishika Chowdhary and Shubham Earla, during 2020-21,
under my supervision and guidance.
Place: Bangalore
Dr. Vanishree M.
We would like to express our profound gratitude to all those who have been instrumental in the
preparation of this project report. We wish to place on record, our deep gratitude to our project
guide Dr. Vanishree M.R , a highly esteemed and distinguished guide, for her expert advice and
help.
We would like to thank Hon. Col. Dr. (Fr.) Abraham V M, Vice Chancellor, CHRIST (Deemed to
be University), Dr. Jain Mathew, Deanery of Commerce and Management, CHRIST (Deemed to
be University), and Dr. Amalanathan S, Head of the Department, Department of Management
Studies, CHRIST (Deemed to be University). for their support.
Lastly we would like to thank God, our Parents and Friends for their constant help and support.
CONTENTS
Company Profile
II
YES Bank 8-42
IDFC Bank
Federal Bank Ltd
Reference -
Annexure -
CHAPTER I-
INDUSTRY PROFILE
1
HISTORY AND EVOLUTION
The traces of the banking system can be noticed from the last decades of the 18th century when
the Bank of Hindustan was established in 1770 and it was the first bank at Calcutta under European
management. It was liquidated in 1830-32. From Bank of Hindustan in 1770, the change of
managing a record in India can be isolated into three noteworthy periods as takes after: Phase I:
Early time of unpleasant Indian banks to Nationalization of Banks in 1969 Phase II: From
Nationalization of India banks in 1969 up to appearance of movement and putting aside some trade
changes out 1991 Phase III: From Indian Financial and Banking Sector Reforms 1991 ahead.
In 1786 General Bank of India was set up. Since Calcutta was the most one-of-a-kind exchanging
port in India, on an exceptionally essential level because of the exchanging of the British Empire,
it changed into a keeping money focus. Three Presidency banks were set up under contracts from
the British East India Company-Bank of Calcutta, Bank of Bombay and the Bank of Madras. These
functioned as semi national banks in India for a long time. The Bank of Calcutta created in 1806
instantly progressed toward getting the chance to be Bank of Bengal. In 1921 these 3 banks joined
with each other and Imperial Bank of India got birth. Stupendous Bank of India was later renamed
in 1955 as the State Bank of India. In this manner, State bank of India is the most settled Bank of
India. In 1839, there was a pointless exertion by Indian intermediaries to build up a Bank called
Union Bank. It struggled inside 10 years. Next came Allahabad Bank which was set up in 1865
and working even today. The most settled Public Sector Bank in India having branches each
finished Indium and serving the clients all through the previous 145 years is Allahabad Bank.
Allahabad bank is for the most part called one of India's Oldest Joint Stock Banks. Regardless, the
Oldest Joint Stock bank of India was the Bank of Upper India created in 1863 and drooped in 1913.
The best and the most arranged bank which is still in proximity is State Bank of India. It was
started as Bank of Calcutta in 1806 and later renamed as Bank of Bengal in 1809. It ended up
Imperial Bank of India when it was met with two one-of-a-kind banks – Bank of Madras and Bank
of Bombay in 1921. After adaptability it was again renamed and progressed toward getting the
chance to be State Bank of India in 1955.
Advancement and Globalization of Indian Banking System
In the mid-1990s, the administration set out on an arrangement of progression, permitting few
private banks.
2
These came to be known as New Generation educated banks and included Global Trust Bank (the
first of such new age banks to be set up), which later amalgamated with Oriental Bank of
Commerce, UTI Bank (since renamed Axis Bank), ICICI Bank and ICICI Bank.
This move, alongside the quick development in the economy of India, renewed the managing an
account division in India, which has seen fast development with solid commitment from all the
three segments of banks, to be specific, government banks, private banks and outside banks.
The present Era
By 2010, keeping money in India was for the most part genuinely developed regarding supply,
item range and reach-despite the fact that compass in rustic India remains a test for the private
division and remote banks.
The Reserve Bank of India is a self-governing body, with insignificant weight from the legislature.
By 2013 the Indian Banking Industry utilized 1,175,149 workers and had a sum of 109,811
branches in India and 171 branches abroad and deals with a total store of ₹54 billion (US$1.1
trillion or €1.0 trillion) and bank credit of ₹52604.59 billion (US$840 billion or €780 billion).The
net benefit of the banks working in India was ₹51 billion (US$16 billion or €15 billion) against a
turnover of ₹9148.59 billion (US$150 billion or €140 billion) for the money related year 2012-
13.On 28 Aug, 2014,Pradhan Mantri Jan Dhan Yojana which is a plan for exhaustive budgetary
consideration propelled by the Prime Minister of India, Narendra Modi. Keep running by
Department of Financial Services, Ministry of Finance, on the initiation day, 1.5 Crore (15 million)
ledgers were opened under this plan. By 10 January 2015, 11.5 crore accounts were opened, with
around ₹8698 crore (US$1.4 billion) were stored under the plan, which additionally has a
possibility for opening new financial balances with zero balance. Physical and also virtual
extension of managing an account through versatile saving money, web keeping money, tele
saving money, biometric and portable ATMs is occurring since a decade ago and has picked up
force in the most recent couple of years.
3
MARKET PLAYERS
The Indian keeping money space is an energizing and dynamic one and the real players are:
State Bank of India
ICICI Bank Limited
HDFC Bank
Axis Bank
Bank of Baroda
Truly Bank
Punjab National Bank
Canara Bank
Association Bank
Dena Bank
Pivot bank
Vijaya bank
South Indian Bank and so forth.
Private area banks in the nation are relied upon to pick up piece of the overall industry at a quicker
pace in the coming quarters as state-run moneylenders; monetary record development is probably
going to be topped because of ascend in awful advances and low capital ampleness proportions.
State-run banks commanded the keeping money framework, with a piece of the pie of 72.1 for
each penny toward the finish of March 2014.
New-age private moneylenders have 15.9 for every penny share, while outside banks and old- age
private loan specialists have 7.2 for each penny and 4.9 for every penny, from the Reserve Bank
of India#39;s (RBI) information. Capital surely has all the earmarks of being an imperative for
government-possessed banks in developing their organizations quickly. It is assessed that near Rs
4.5 lakh-crore of level I capital will be required by these banks to meet the new Basel-III capital
standards. Of this Rs 2.4 lakh-crore will be required as value capital. With state-claimed banks
woefully shy of capital, private moneylenders are probably going to continue picking up share no
matter how you look at it — in credits, stores, and charges — at a forceful pace; This will help
private banks in developing their income at an annualized rate of more than 20 for every penny for
a couple of years.
4
The administration’s intent to downsize its possessions out in the open area banks to 52 for every
penny may not by any means take care of their capital issue; This may not be adequate to
completely meet the capital needs of open division banks under Basel-III standards, especially
since the projections depend on least prerequisites. Open area banks should diagram an
unmistakable capital raising arrangement throughout the following five years; R Gandhi,
representative legislative head of RBI.Non-performing resources stay another stress. Many state-
run banks have diminished corporate loaning and are concentrating on little ticket credits and retail
progresses because of advantage quality concerns. In one specific bank, the controller has topped
the advance size after it found the credit examination framework was remiss.
Area specialists said nonappearance of government impedance, better administration benchmarks
and solid frameworks are a few elements helping private banks in enhancing piece of the overall
industry.
Market Size: - The Indian saving money framework comprises of 27 open area banks, 22 private
part banks, 44 outside banks, 56 local country banks, 1,589 urban agreeable banks and 93,550
provincial helpful banks, notwithstanding agreeable credit foundations. Bank credit developed at
12.64 for each penny year-on-year to Rs 85.511 lakh crore (US$ 1,326.78 billion) on May 11,
2018 from Rs 75.91 lakh crore (US$ 1,131.47) on May 12, 2017.
5
pleasing banks, despite supportive credit establishments. As of Q4FY17-18, indicate credit
connected by business banks overwhelmed to Rs 86,825,727 million (US$ 1,347 billion) and stores
created to Rs 114,792,883 million (US$ 1,781 billion). Assets of open division banks stayed at
US$ 1,557.04 billion in FY18. Indian banks are dynamically focusing on grasping a joined
approach to manage chance organization. Banks have quite recently gotten a handle on the overall
keeping cash supervision accord of Basel II, and larger piece of the banks adequately meet capital
necessities of Basel III, which has a due date of March 31, 2019. Spare Bank of India (RBI) has
set up Public Credit Registry (PCR) an expansive database of credit information which is available
to all stakeholders. The Insolvency and Bankruptcy Code (Amendment) Ordinance, 2017 Bill has
been passed and is required to fortify the setting aside some cash fragments. Stores under Pradhan
Mantri Jan Dhan Yojana (PMJDY) are growing Rs 80,674.82 crore (US$ 12.03 billion) and
32.25million records were opened in India. In May 2018, the Government of India gave Rs 6
trillion (US$ 93.1 billion) advances to 120 million beneficiaries under Mudra contrive. In May
2018, the total number of endorsers was 11 million, under Atal Pension Yojna. Rising profit is
depended upon to enhance the necessity for setting aside some cash benefits in commonplace
regions and in this way drive the advancement of the portion.The mechanized portions change will
trigger enormous changes in the way in which credit is apportioned in India. Charge cards have
supplanted Mastercard as the favoured portion mode in India, after demonetisation. Platinum cards
earned an offer of 86.79 for each penny of the total card spending.
GOVERNMENT REGULATIONS/POLICIES
India has both private area banks (which incorporate branches and backups of outside banks) and
open part banks (ie, banks in which the administration specifically or by implication holds
proprietorship premium). Banks in India can basically be named:
Scheduled business banks (ie, business banks playing out all managing an account
capacities);
Cooperative banks (set up by agreeable social orders for giving financing to little
borrowers); and
regional provincial banks (RRBs) (for giving credit to rustic and farming zones).
6
As of late, the RBI has likewise presented specific banks, for example, installments banks and little
fund banks that perform just some managing of account capacities. The key statutes and controls
that represent the saving money industry in India and especially planned business banks are as per
the following:
1. RBI Act
The RBI Act was sanctioned to build up and set out elements of the RBI. It concedes the RBI
forces to direct the money related arrangement of India and sets out the constitution, consolidation,
capital, administration, business and elements of the RBI.
2. BR Act
The BR Act gives a system to supervision and direction everything being equal. It additionally
enables the RBI to concede licenses to banks and control their business activity.
3. FEMA
FEMA is the essential trade control enactment in India. FEMA and the standards made thereunder
control cross-outskirt exercises of banks. These are controlled by the RBI.
7
CHAPTER II –
COMPANY PROFILE
8
COMPANY 1: YES BANK
Brand Ethos
To be the Professionals’ Bank of India
Vision: Building the Finest Quality Large Bank of the World in India
Mission: To establish a high-quality, customer-centric, service-driven, private Indian Bank
catering to the ‘Future Businesses of India’
9
NO OF EMPLOYEES : 22,973
10
CORPORATE GOVERNANCE
As the fourth largest private sector Bank, YES BANK is establishing the highest standards of
Corporate Governance across the organization. With an excellent Board of Directors and the
institution of all recommended sub committees, the Bank is compliant with all the necessary
statutory requirements.
YES BANK is ordained to set the highest standards of Corporate Governance right from its
inception benchmarked with the best class practices across the globe. Effective Corporate
Governance is the manifestation of professional beliefs and values, which configures the
organizational values, credo and actions of its employees. Transparency and accountability are the
fundamental principles to sound Corporate Governance, which ensure that the organization is
managed and monitored in a responsible manner for 'creating and sharing value'.
YES BANK believes that there is a need to view Corporate Governance as more than just
regulatory requirements as there exists a fundamental link with the organization of business,
corporate responsibility and shareholder wealth maximization.
Therefore, YES BANK is articulating a multi-stakeholder model (including shareholder value) of
accountability that will manage the symbolic relationship between the various stakeholders. This
approach will be central to the day-to-day functioning of the Bank and in implementation of its
business strategy.
Corporate Governance Initiatives at YES BANK
The Composition of the Board of Directors of YES BANK is in compliance with the
Banking Regulation Act, all RBI guidelines (including the Ganguly Committee
recommendations), Companies Act, 2013, SEBI Listing Regulations and in
accordance with best practices in Corporate Governance
In compliance with the requirements of the Companies Act, 2013, Banking
Regulation Act, 1949, RBI guidelines, SEBI Listing Regulations, 9 Board level sub-
committees have been set up to ensure effective functioning of the Board.
The Bank has implemented a Code of Conduct and Ethics for the Board of Directors
and Senior Management.
11
YES BANK has instituted a comprehensive code of conduct for prevention of insider
trading in accordance with the requirements of SEBI (Prohibition of Insider Trading)
Regulations, 2015.
The Bank has formulated a Whistle Blower Policy in line with the best international
governance practices.
Familiarisation Programmes for Directors
A science graduate and a law graduate from Delhi University, Prashant Kumar joined SBI in the
year 1983 as Probationary Officer and since then he has held various important portfolios in the
Bank.
With over three decades of experience, Kumar has worked in the fields of credit, human resources
and training systems at the bank. Over the years, Kumar has served as chief general manager of
the bank's Kolkata Circle as well as the Mumbai Circle.
Yes Bank was placed under a "moratorium" in march 2020, with the RBI capping depositor
withdrawals at Rs 50,000 per account for a month and superseding the board with immediate
effect.
The RBI took the decision in consultation with the government to protect depositors' interest. The
RBI also superseded the board of Yes Bank, which has not been able to raise the required capital
for the last six months.
TOTAL SHARE CAPITAL
12
SHAREHOLDING PATTERNS AND MAJOR SHAREHOLDERS
13
ORGANISATIONAL STRUCTURE
14
TOTAL SALES
The sales have been significantly rising over the years but we could witness a huge dip owing to
the coupled effect of bankruptcy and pandemic downfall. The sales have risen from Rs. 13,533 Cr
in 2016 to Rs. 26,066 Cr in 2020.
15
ANNUAL GROWTH RATE OF YES BANK LTD.
2
Yes Bank Limited, Asset Management Arm
3
YES Asset Management (India) Ltd.
4
Yes Trustee Limited
5
Yes Securities (India) Limited
16
CORPORATE ADDRESS OF YES BANK
ONE International Center, Tower II, 15th Floor, Senapati Bapat Marg, Elphinstone (W), Mumbai
400 013, India.
M& A TRANSACTIONS
Colossus Holdings Pte Ltd - Acquisition of Honiton Energy Holdings plc Formation of JV
with Arcapita Bank B.S.C © - USD 300 mn.
e4e Mauritius- 32.57% stake sale in Aztecsoft Limited to Mindtree Limited- INR 1.17 bn.
Senergy Global Pvt. Ltd.- Acquisition of majority stake in IT Power Limited, UK
Sintex Industries Zeppelin Mobile Systems India Limited -Acquisition of Digvijay Group,
India- INR 540 mn
Apar Industries- Acquisition of strategic stake (48%) in Uniflex Cables- INR 1.27 bn.
PRODUCT PROFILE
· Investment Banking Solutions
· Yes First Corporate Credit Card
· Yes Prosperity Purchase Credit Card
· Treasury And Risk Management Solutions
· Loans
· Transactions Banking Solutions
· Debt Capital Markets
· Surplus and Investments
· Digital Banking
YES! i m the CHANGE (YIAC) is a social filmmaking challenge, where college going students
are encouraged to make short films on social causes.
Launched in 2013 by YES FOUNDATION, the social development arm of YES BANK, YES! i
am the CHANGE is a nationwide social film project which aims to ignite inner transformation of
youth, where youth participants make short films of up to 3 minutes duration on NGOs, social
causes and everyday heroes. In 2016 the program emerged as the largest social filmmaking
17
program globally with over 1.3 million registered participants from 2500 cities and towns across
India. Till date the program has engaged with more than 2 million youth who made and submitted
more than 40,000 short films. The best films are showcased in film festivals, youth festivals and
community events to spread awareness about social organizations and social causes to build wider
social engagement. Yes Bank is successful because it is a highly interactive bank because it
undertakes numerous engaging activities for the lower income groups as well as he youth.
Since its inception in 2004, YES BANK has adopted international best practices, with the highest
standards of service quality and operational excellence. It offers comprehensive banking and
financial solutions to all its customers. YES BANK has received numerous recognitions for its IT
infrastructure and payments solutions, as well as excellence in human capital. Today, YES BANK
has over 570 branches across 350 cities, with 1,150+ ATMs and two National Operating Centers
in Mumbai and Gurgaon. Using technology to provide superior customer service is central to YES
BANK's business philosophy. By offering innovations such as mobile banking, two-factor
authentication, radio-frequency identification and advanced speech-enabled interactive voice-
response systems, YES BANK delivers a differentiated service to its commercial and retail
customers.
MARKET CAPITALISATION
Rs. 36755.55 Crores.
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LITIGATIONS AGAINST YES BANK:
Yes Bank Case: Supreme Court stays Bombay HC order granting bail to DHFL promoters
Kapil and Dheeraj Wadhawan.
Axis Trustee sends legal notice to YES Bank for allegedly hiding facts while raising
funds.
Yes Bank Case: Madras HC upholds legal validity of RBI’s circular on Additional Tier 1
Capital Bonds
Mr. Ravneet Gill takes charge as MD & CEO, YES BANK celebrates 15 Years of
Institutional Excellence
YES BANK successfully completes maiden USD 600 million Bonds issuance under its
MTN program, in International Debt Markets
Received final license from SEBI for Custodian of Securities Business
Receives SEBI approval to launch Mutual Fund Business
Raised INR 4906.68 Cr (USD 750 Mn) QIP which is India’s largest private sector QIP in
INR terms
YES BANK signs MoU with IFC and Goldman Sachs 10,000 women for USD 50 Million
Loan
Youngest Indian Company to be part of the Forbes Global 2000 List
FMO, Dutch Development Bank signs definitive agreement to invest USD 50 Mn in YES
BANK’s Green Infrastructure Bond
19
COMPANY 2 : IDFC BANK
IDFC First Bank (formerly IDFC Bank) is an Indian banking company with headquarters in
Mumbai that forms part of IDFC, an integrated infrastructure finance company. The bank started
operations on 1 October 2015. IDFC FIRST received a universal banking licence from the Reserve
Bank of India (RBI) in July 2015. On 6 November 2015, IDFC Bank was listed on BSE and NSE.
Vision -To be a leading financial services provider- admired and respected for high corporate
governance, ethics and values. To finance the aspirations of the Indian Consumers using new-age
analytics and technology solutions.
Mission- To primarily support the growth of MSMEs in India with debt capital through technology
enabled platforms and processes.
KEY EXECUTIVES:
20
2. Head - Legal & Co. Secretary Mr.Satish Gaikwad
Code of Practices and Procedure for Fair Disclosure of Unpublished Price Sensitive
Information -
This Code is called IDFC FIRST Bank’s Code of Practices and Procedure for Fair
Disclosure of Unpublished Price Sensitive Information (“Code”) and is framed based on
the principles of fair disclosure envisaged in Regulation 8 of Securities and Exchange
Board of India (SEBI) (Prohibition of Insider Trading) Regulations, 2015, to adhere to
practice and procedures for fair disclosure in respect of Unpublished Price Sensitive
Information (UPSI), relating to Bank and/or its securities.
1. All UPSI shall be handled on a need to know basis only and no UPSI shall be
communicated to any person except in furtherance of legitimate purposes, performance of
duties or discharge of legal obligations. Also, the UPSI shall be communicated for the
aforesaid purposes only after consulting Managing Director / Chief Financial Officer /
Company Secretary in advance.
21
2. UPSI that would impact price discovery shall be promptly disclosed to the public no sooner
than credible and concrete information comes into being in order to make such information
generally available. No UPSI should be released/ communicated to any stakeholder, until
such time.
3. UPSI shall be usually disseminated in a uniform and universal manner by the Bank through
the following means: - Intimation to the Stock Exchanges or any other Regulatory
authorities as may be required from time to time; - Press releases or presentations to
analysts/ investors or briefings to media.
PROFILE OF CEO/CMD :
Mr. V. Vaidyanathan is the first Managing Director and CEO of IDFC FIRST Bank, a bank
founded by the merger of Capital First and IDFC Bank in December 2018.
22
Prior to this role, he founded Capital First Limited by first acquiring an equity stake in an existing
NBFC, and then executing a Management Buyout (MBO) by securing an equity backing of Rs.
810 crores in 2012 from PE Warburg Pincus. The MBO included (a) buyout of majority and
minority shareholders through Open Offer to public; (b) Fresh capital raise of Rs. 100 crores into
the company; (c) Reconstitution of the Board of Directors (d) Change of business from wholesale
to retail lending; (e) Creation of a new brand "Capital First".
From To (Rs. cr) (Rs. cr) Shares (nos) Face Capital (Rs.
Value Cr)
23
TOTAL SALES (INDIAN &INTERNATIONAL OPERATIONS)
The sales have been consistently rising over the years. The sales have grown from Rs. 3648 Cr in
2016 to Rs. 15, 867 Cr in 2020.
24
ForeignInstitutions 636918291 11.23%
25
26
ORGANISATIONAL STRUCTURE
Kotak Mahindra Bank Ltd: Lowest Interest rate of Kotak Bank Business Loan is 16.00%,
which is lower than the lowest interest rate of IDFC First Bank at 22.00%. Hence, Kotak
Bank is offering a cheaper loan option.
HDFC Bank: Lowest Interest rate of HDFC Home Loan is 6.90%, which is lower than the
lowest interest rate of IDFC First Bank at 9.50% and hence, HDFC is offering a cheaper
loan option.
Axis Bank Ltd.: Lowest Interest rate of Axis Bank Home Loan is 6.90%, which is lower
than the lowest interest rate of IDFC First Bank at 9.50% and hence, Axis Bank is offering
a cheaper loan option.
27
ANNUAL GROWTH RATE:
S. No. Name
3. IDFC Securities
28
4. IDFC Pension Fund Management
5. IDFC Foundation
Mumbai – 400051
Mergers:
In January 2018, Erstwhile IDFC Bank and Erstwhile Capital First announced a merger.
Shareholders of Erstwhile Capital First were to be issued 13.9 shares of the merged entity for every
1 share of Erstwhile Capital First. Thus, IDFC FIRST Bank was founded as a new entity by the
merger of Erstwhile IDFC Bank and Erstwhile Capital First on December 18 2018
Joint Ventures:
IDFC Bank has partnered with Bangalore-based online lending platform, Capital Float, to provide
digital lending to small businesses across India.
29
The partnership will address the needs of borrowers who have no access to organized bank credit,
with limited or no documentation and without existing credit history. It is thus expected to bring
more small businesses into the organized finance architecture
Licencing:
The ‘in-principle’ approval implies that the lender now has 18 months to comply with all
conditions required to get the final SFB license from the RBI.
Strategic Alliance:
IDFC Bank entered into a strategic partnership with digital payments solution company
MobiKwik to launch a co-branded virtual Visa prepaid card for customers of MobiKwik.
The bank serves corporate and private customers in India including the infrastructure sector that
IDFC specialized in from its founding in 1997. The bank also aims to provide services to people
in rural areas and to the self-employed. It is a holding company mainly holding investment in IDFC
Financial Holding Company Limited (IDFC FHCL) which is a non-operative financial holding
company. IDFC FHCL in turn holds investments in IDFC Bank IDFC Asset Management
Company Limited IDFC Alternatives Limited IDFC Securities Limited and IDFC Infrastructure
Finance Limit.
PRODUCT PROFILE:
Personal Banking:
1. Savings Account
2. Deposits
3. Loans
4. Investment
30
5. Insurance
6. Way To Bank
7. Payments
8. Card
9. Forex
IDFC FIRST Bank Limited, listed in NSE and BSE, is a leading Indian financial institution,
specializing in providing debt financing to MSMEs and Consumers in India.
Unlike traditional models of financing, IDFC FIRST Bank has successfully created new models
to finance MSMEs and Indian consumers, in the hitherto unbanked and under-penetrated
segments. The Company uses a differentiated model, based on new technologies and deep
analytics. With this differentiated approach, IDFC FIRST Bank has financed over 7.0 million
customers in more than 225 locations across India and built loan assets of Rs 326.22 Bn (USD
4.47 bn) as on 30 September, 2018, with 91% of its loan assets in the Consumer & MSME
financing space. IDFC FIRST Bank has maintained high asset quality over the years. The Gross
and Net NPA of the Company is 1.62% and 1.00% respectively as of 30th June 2018 on 90 dpd
NPA recognition basis.
The company enjoys the highest long term credit rating of AAA. IDFC FIRST Bank is focused on
building an institution on strong pillars of ethics, values and high corporate governance.
Its current market capitalization stands at Rs 18917.29 Cr. In the latest quarter, company has
reported Gross Sales of Rs. 162403.19 Cr and Total Income of Rs.179627.28 Cr.
31
MAJOR CLIENTS/CUSTOMERS
Flipkart
BNP Paribas
Indigo
AWARDS/RECOGNITIONS:
32
COMPANY 3 : FEDERAL BANK LTD
Federal Bank Limited is a major Indian commercial bank in the private sector headquartered at
Aluva Kerala. The Bank operates in four segments: treasury operations wholesale banking retail
banking and other banking operations. Treasury operations include investment and trading in
securities shares and debentures. The Bank's products and services include working capital term
finance trade finance specialized corporate finance products structured finance foreign exchange
syndication services and electronic banking requirements. The bank has 1252 branches, 1696
ATMs and 231 Cash Machines as on 31 March 2018. The bank also has its representative offices
in Abu Dhabi and Dubai and an IFSC Banking Unit (IBU) in Gujarat International Finance Tec-
City (GIFT City).The Bank offer its customers a variety of services such as Internet banking
Mobile banking On-line bill payment Online fee collection depository services Cash Management
Services merchant banking services insurance mutual fund products and many more as part of its
strategy to position itself as a financial super market and to enhance customer convenience.Federal
Bank Ltd was incorporated on April 28 1931 with the name Travancore Federal Bank Ltd. The
company was established with an authorized capital of rupees five thousand at Nedumpuram a
place near Tiruvalla in Central Travancore under the Travancore Company's Act. The Bank was
founded by K.P.Hormis.
Vision: To be the ‘Most Admired Bank' which is digitally enabled with a sharp focus on Micro,
Medium and Middle market enterprises.
NO OF EMPLOYEES: 12227
33
KEY EXECUTIVES OF FEDERAL BANK LTD
S. No Designation Name
1. EVP & Chief Human Resources Officer Mr. Ajith Kumar K K
CORPORATE GOVERNANCE:
Corporate governance is essentially a set of standards, systems, and procedures aimed at effective,
honest, transparent, and responsible management of a company within the applicable statutory and
regulatory structures. This Code represents a set of desirable, if not necessarily ideal, corporate-
governance practices to be adopted by the Bank. The Code takes into account the relevant statutory
and current stock-exchange listing requirements and Reserve Bank of India (RBI) directives and
guidelines. The efficacy of the Code lies in how well it is put into practice. In adopting the Code,
the stress should be on its substance and spirit rather than on its form.
Good corporate governance practices help support and strengthen corporate actions aimed at
achieving the corporate objective. The Bank’s principal corporate objective, like that of any
corporate business entity, is to perpetuate its business while protecting and enhancing, over the
long term, the value of the investments of its shareholders in the Bank.
34
a. to guide, approve, and review the Bank’s corporate objectives; competitive position and
strategy; operational, financial, personnel, and other policies; and operational goals, and business
plans;
b. to monitor the Bank’s performance, including effective implementation of the approved policies,
strategies, and plans, and statutory and regulatory compliance;
c. to appoint and replace the chief executive officer and the Executive Directors (whether or not
members of the Board), determine their compensation, counsel and guide them on important
issues, oversee and review their performance, and plan their succession;
d. to review the utilisation and development of the Bank’s human resources;
e. to ensure that appropriate internal control systems, including those relating to accounting,
financial management, risk exposure and management, and statutory and regulatory compliance,
are in place and are effective.
PROFILE OF CEO/CMD
Shri Shyam Srinivasan took charge as the Managing Director & CEO of Federal Bank on 23rd
September 2010. He joined Federal Bank, equipped with the experience of over 20 years with
leading multinational banks in India, Middle East and South East Asia, where he gained significant
expertise in retail lending, wealth management and SME banking.
Shri Shyam Srinivasan is an alumnus of the Indian Institute of Management, Kolkata and Regional
Engineering College, Tiruchirapally. He has completed a Leadership Development Program from
the London Business School and has served on the Global Executive Forum (the top 100
executives) of Standard Chartered Bank from 2004 to 2010.
At Federal Bank, he has been instrumental in implementing various path-breaking initiatives which
include : Increasing the presence and visibility of the Bank to a national level; creating an inherent
capability within the Bank to reinvent and re-implement processes - especially the customer-
critical ones, initiating the Total Quality Management Journey of the Bank, focusing on under-
writing quality at every stage right from credit selection, incubating the human resource potential
35
of the Bank and so on. He continues his mission to create a culture of Ethics and Excellence in the
Bank, which he so believes in.
SHAREHOLDING PATTERN
36
MAJOR SHAREHOLDERS
ORGANIZATIONAL STRUCTURE
37
TOTAL SALES
The sales have increased over the years with Rs. 7748. 15 Cr in 2016 to a whopping Rs. 11419 Cr
in 2020. This has been caused because of the shift of focus from corporate portfolio to retail
customers.
MAJOR COMPETITORS
Bandhan Bank Ltd. : The Company has a great impact in the eastern region of India. It is
the go-to bank for retail customers in the microfinance industry.
Axis Bank: It is one of the largest private sector financiers in Indian agriculture.
City Union Bank Ltd: It is one of the leading scheduled commercial banks in the private
sector with major presence in urban, semi-urban and rural centers in South India.
38
ANNUAL GROWTH RATE OF FEDERAL BANK LTD.
S.No Name
1
Fedbank Financial Services Limited
2
Federal Bank International
3
Federal Bank Ltd., Asset Management Arm
39
CORPORATE ADDRESS OF FEDERAL BANK LTD.
Federal Bank Limited, Federal Towers, Aluva-683101, Kerala, India.
M & A TRANSACTIONS:
Acquisition: Federal Bank recently took over 32 branches of the 85-year-old GBK spread across
Maharashtra and Karnataka with deposits of Rs 250 crore and loans of Rs 105 crore. GBK’s loss
of Rs 7.5 crore triggered the merger process and even after RBI’s order for the merger, the matter
was pending in the Supreme Court. The depositors were agitating for a quick merger and had even
sent pleas to the apex court to expedite the merger.
Merger: Federal Bank and Lord Krishna Bank boards signed into a merger in October 2005.
Federal Bank launched its International Debit Cards in the year 2004. The same year, it also
provided Real Time Gross Settlement (RTGS) facility in all the branches, followed by Online
Railway Reservation (with the first kiosk at the Marine Drive branch of Kochi). One year later,
the bank launched Fed+Amrita, an online system for fixing medical consultation, health check up,
and in-patient payments, from anywhere. In 2006, Federal Bank issued GDRs, becoming the first
traditional bank to do so.
Advances
BSNL Bill Payment
Cash Management Services
Cash -On- Line Express Cash Remittance
Credit Cards
Depository Services
Easy Pay-On-line Fee Payment System
E-shopping Payment Gateway
Export Credit Insurance Products in association with ECGC
40
REASON FOR THE SUCCESS
The Federal Bank Limited engages in commercial banking activities in India. It operates through
four segments: Treasury, Corporate/Wholesale Banking, Retail Banking, and Other Banking
Operations. The company's deposit products include savings accounts, current accounts, demat
accounts, salary accounts, fixed deposits, cash certificates, recurring deposits, exchange earner's
foreign currency accounts, gilt accounts, and NRI deposit schemes. Its loan portfolio comprises
gold, housing, car, property, educational or career, cash, instant digital, business, and agriculture
and agricultural allied loans; travel, gift, debit, and credit cards; and loans against fixed deposits.
The company also provides life, health, and general insurance products; mutual funds, online
trading, and national pension system, as well as term loans, project finance, bill discounting,
working capital loans, bank guarantees, letter of credit, packing credit limit, rediscounting of
export bills, Internet banking, mobile banking, ATM, telephone banking services. As of March 31,
2019, it operated through a network of 1,251 branches and 1,669 ATMs. The major reason behind
its success is that it laid its main focus on retail customers and brought in technology in the banking
system since its inception.
41
LITIGATIONS
Federal Bank Ltd vs Sagar Thomas & Ors on 26 September, 2003 - Federal bank caught in
the companies act 2013 - call itself private when listed.
Federal Bank fined Rs 5 cr for non-compliance of RBI norms - South-based Federal Bank
has been penalised Rs 5 crore for non-compliance on reporting of large borrower exposures
and non-payment of customer compensations, among other deficiencies.
Sebi penalises Federal Bank employees for violating market norms - Capital markets
regulator Securities and Exchange Board of India (Sebi) on Thursday penalised an
employee of Federal Bank , who is also a designated person, for violating insider trading
norms and not obtaining pre-clearance from the bank for his trades.
AWARDS/RECOGNITIONS
Federal Bank has won the Bank of the Year 2019 Award at the Dhanam Banking and Finance
Summit
Federal Bank has conferred with the Best Bank Small – 1st Runner Up Award under the
Overall Best Bank category at the 11th edition of Magna Awards instituted by Business
world
Federal Bank has won Indian Express Group Technology Senate Award for FedRecruit
Federal Bank won 1st prize in Best Technology Bank award organized by IBA
Federal Bank has won the Best Bank of the Year award at the Dhanam Banking and
Finance Summit
Federal Bank won 1st prize in best technology bank award 2019
Federal Bank Wins National Payment Excellence Award
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CHAPTER 3 –
INDUSTRY ENVIRONMENT
ASSESSMENT
43
PESTEL ANALYSIS
The banking industry affects all countries. But it’s subservient to many factors, particularly to the
government and the economy. Banks are unable to behave independently and must provide
services based on specific laws that affect their growth and offerings.
This PESTLE (Political, Economic, Sociocultural, Technological, Legal and Environmental)
analysis highlights key factors affecting the banking industry.
44
Technology is changing how consumers handle their funds. Many banks offer a mobile app to
witness accounts, transfer funds, and pay bills on smartphones.
Smartphones can scan cheques, and the bank can process it from their end, at their location. This
change helps to save paper and the need to drive directly to the branch to handle these affairs.
Debit cards are also changing. Chips have been implemented, requiring users to insert their card
into debit machines rather than swiping them. Other countries, such as Canada, have implemented
a “tap” option — tapping the debit card onto the device, requiring no pin, for a transaction to
complete. These changes make it easier on the user to make purchases without required intrusion
from banks.
Even banks themselves are utilizing technology within the workplace. Telecommunicating
through virtual meetings is being embraced. It replaces the need for in-person meetings.
In conclusion, the banking industry is held accountable by the government. What and how they
offer services are determined by politics and current governmental laws. Additionally, banks are
at the whim of the economy — inflation rates can devastate banking prospects as it affects the
value of currency.
45
CHAPTER 4 –
COMPARITIVE ANALYSIS
46
COMPARATIVE ANALYSIS BETWEEN YES BANK LTD, IDFC BANK
AND FEDERAL BANK LTD
S.No Parameter Yes Bank IDFC Bank Federal Bank
1 Name of the YES BANK IDFC First Bank Federal Bank Limited
Business 2004 1997 1931
Enterprise and
Year of
Establishment.
2 No. of. 18,239 20,022 12,227
Employees and Mr.Prashant Kumar Mr.Satish Gaikwad Mr. Shyam Srinivasan
Brief Profile of Mr.Parag Mr. V vaidyanath Mr. Samir Rajdev
Key Executives Gorakshakar
Mr.Anurag Adlakha
47
Major Institutions – 15% Govt – 7 % Institutions – 3%
Shareholder Others – 11%
FII – 46% Others – 78%
Public 21%
Others – 3 % FII – 8%
7 Major HDFC Bank, SBI HDFC Bank, Axis Bandhan Bank, Axis
Competitors bank, Kotak Bank, Kotak Bank, City Union Bank
48
11 Mergers and Colossus Holdings Erstwhile IDFC Acquisition Of Ganesh
Acquisitions, Pte Ltd, Apar Bank and Erstwhile Bank
Industries Capital First, IDFC Merger with Lord
Bank has partnered Krishna Bank
with Bangalore-
based online lending
platform, Capital
Float
12 Diversification in - - -
to other
businesses
13 Brief Product · Investment Personal Banking: Advances
profile Banking Solutions BSNL Bill
1. Savings
· Yes First Payment
Account
Corporate Credit Cash
Card 2. Deposits Management
· Yes Prosperity Services
Purchase Credit 3. Loans Cash -On- Line
Card Express Cash
Business Banking:
· Treasury And Remittance
Risk Management 1. Accounts & Credit Cards
Solutions Deposits Depository
· Loans Services
2. Cash
· Transactions Easy Pay-On-line
Management
Banking Solutions Fee Payment
Services
· Debt Capital System
Markets Wholesale Banking: E-shopping
Payment
1. Corporates
Gateway
2. Mncs
49
Wealth
Management:
1. Investment
Solutions
2. Personal
Insurance Solutions
14 Registered - - -
Patents/ Trade
Marks/ Copy
Rights/GI
Registrations
15 Market Rs. 36755.55 Rs 18917.29 Cr Rs. 116.90B
capitalization Crores.
50
2. Supreme Bank 26 September, 2003,
Slams Federal Bank fined Rs 5
Bankruptcy cr for non-compliance of
RBI norms
18 Awards Received National Federal Bank has
final license Payments won Indian
from SEBI Excellence Express Group
for Awards Technology
Custodian of Edge Awards Senate Award for
Securities ICAI Awards FedRecruit
Business Federal Bank
Receives won 1st prize in
SEBI Best Technology
approval to Bank award
launch organized by
Mutual IBA
Fund Federal Bank has
Business won the Best
Raised INR Bank of the Year
4906.68 Cr award at the
(USD 750 Dhanam Banking
Mn) QIP and Finance
which is Summit
India’s
largest
private
sector QIP
in INR terms
51
SWOT ANALYSIS OF YES BANK
Parameters Analysis
Strengths Largest Private Sector Bank.
Diversified Business
A Large Number of Customers
Management
High-End Technology
Weaknesses Security over Digital Media
Use of Digital in Rural Area
Heterogeneous Client
Change in Laws and Regulations
Opportunities Large Asset in one Client
Global Market
Expanding Services to Clients
Business goals towards middle and lower income groups
Awareness in Digital Media
Threats Security Issues
High Fee
Global Competitors
52
Opportunities Brokers upgraded recommendation or target price in the past three
months
Highest Recovery from 52 Week Low
Decrease in Provision in recent results
Stock with Low PE (PE < = 10)
RSI indicating price strength
53
MC KINSEY’S 7 S MODEL OF YES BANK
S Analysis
Strategy Customer retention strategy
ATM strength Strategy
Marketing and Branding Strategy
Structure Vertical Level
System Technological advancement providing great security
Customer database management
Simple plan(not complex)
Staff The company has 69,065 employees, out of which 12,295 are women
(17.80%).
Skill Professionalism
Innovation
Team Spirit
Pragmatism Integrity
Shared Values To be customer driven best managed enterprise that enjoys market
leadership in providing housing related finance.
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MC KINSEY’S 7 S MODEL OF IDFC FIRST BANK
S Analysis
Strategy The integrated vision and direction of IDFC as well as the manner, in
which it derives, articulates, communicates and implements that vision
and direction.IDFC has marketing department which keeps an eye on the
market, about tenders and decides various strategies.
System There are three types of system in IDFC. These are Marketing and sales,
Operation and Human Resource
Staff IDFC selects appropriate and well qualified candidates. Selection,
training, reward, retention, motivation and assignment to appropriate are
all key issues.
55
MC KINSEY’S 7 S MODEL OF FEDERAL BANK
S Analysis
Strategy The integrated vision and direction of Federal Bank as well as the manner,
in which it derives, articulates, communicates and implements that vision
and direction
System The system is more of flexible owing to several changes happening in the
external environment.
Staff Federal Bank selects appropriate and well qualified candidates. Selection,
training, reward, retention, motivation and assignment to appropriate are
all key issues
Style Participative leadership is practiced
Skill Federal Bank lays utmost importance on training and development of its
people as they are constantly brining in technology.
Shared Values Regional values are portrayed and the spirit of intrapreneurship is boosted.
Federal Bank has a strong culture and deep rooted shared values
56
CHAPTER 5 –
FINDINGS AND
SUGGESTIONS
57
FINDINGS
In the present era, the Banking sector is the backbone of business and trade. It regulates the
operations and flow of money among all industries. The Indian banking system consists of 12
public sector banks, 22 private sector banks, 46 foreign banks, 56 regional rural banks, 1485 urban
cooperative banks and 96,000 rural cooperative banks in addition to cooperative credit institutions.
As on January 31, 2020, the total number of ATMs in India increased to 210,263 and is further
expected to increase to 407,000 by 2021.
Banking systems have been with us for as long as people have been using money. Banks and other
financial institutions provide security for individuals, businesses and governments, alike.
In general, what banks do is pretty easy to figure out. For the average person banks accept deposits,
make loans, provide a safe place for money and valuables, and act as payment agents between
merchants and banks. Banks are quite important to the economy and are involved in such economic
activities as issuing money, settling payments, credit intermediation, maturity transformation and
money creation in the form of fractional reserve banking. To make money, banks use deposits and
wholesale deposits, share equity and fees and interest from debt, loans and consumer lending, such
as credit cards and bank fees. In addition to fees and loans, banks are also involved in various other
types of lending and operations including, buy/hold securities, non-interest income, insurance and
leasing and payment treasury services. History has proven banks to be vulnerable to many risks,
however, including credit, liquidity, market, operating, interest rate and legal risks. Many global
crises have been the result of such vulnerabilities and this has led to the strict regulation of state
and national banks. However, other financial institutions exist that are not restricted by such
regulations. Such institutions include: savings and loans, credit unions, investment and merchant
banks, shadow banks, Islamic banks and industrial banks. Important opportunities to manage risks
and developing innovative operational solutions have yet to be seized. There is still room for
country programs and projects to improve measurement of governance results, to expand overall
use of measures to foster the demand for good governance, and to deploy more systematically
enhanced GAC measures to manage fiduciary and governance-related risks. The Bank’s response
in countries experiencing governance downturns has not been consistent. Bank teams continue to
face operational challenges in helping countries address a number of GAC related issues.
Enhanced spending on infrastructure, speedy implementation of projects and continuation of
reforms are expected to provide further impetus to growth in the banking sector. All these factors
58
suggest that India’s banking sector is poised for a robust growth as rapidly growing businesses
will turn to banks for their credit needs.
Also, the advancement in technology has brought mobile and internet banking services to the fore.
The banking sector is laying greater emphasis on providing improved services to their clients and
upgrading their technology infrastructure to enhance customer’s overall experience as well as give
banks a competitive edge.
SUGGESTIONS
Exploring advances in mobile payment options.
Using biometrics, such as voice identification and eye scanning, to increase security.
Integrating systems and converting old data to new formats.
Allow Consumers to Self-Serve
Stay Consistent Across All Touch Points
Educate Your Customers on Financial Literacy
Embrace Financial Technology
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The auditors' selection has to be done with care. Yes Bank’s auditors could not find
the window-dressing the bank management was indulging in.
The former chief executive officer Rana Kapoor has been arrested for investigation
into the widespread lapses, but the guilty should not go scot-free so that a message
is sent to prevent such instances.
3. FEDERAL BANK -
At present, the company majorly focuses on retail customers. However, in order to
expand its horizon it should work towards building a strong profile in the corporate
banking segment.
The bank primarily works and operates in the south-western region of the country,
but it should work towards upscaling and spreading itself all across the nation.
60
REFERENCES
https://www.screener.in/
http://www.moneycontrol.com/
https://www.nseindia.com/
https://in.investing.com/
https://www.federalbank.co.in/
https://www.yesbank.in/
https://www.idfcfirstbank.com/
61
ANNEXURE
YES BANK
-
62
IDFC FIRST BANK
63
FEDERAL BANK
64