HDFC BANK

INTRODUCTION
1.
2.
3.
4.
5.

INTRODUCTION TO THE SECTOR PUBLIC / PVT.

BRIEF HISTORY OF THE BANK
USP OF THE BANK
MANAGEMENT
PRODUCTS AND SERVICES - CATEGORYWISE - RETAIL, CORPORATE
BANKING, VALUE ADDED ETC.
6. COMPETITIVE POSITION SWOT - INDUSTRY, SECTOR (PUB/PVT)

1. INTRODUCTION TO THE SECTOR PUBLIC / PVT:

The Indian Banking Sector is made up of both Public Sector and Private Sector Banks
Banking in India has been dominated by public sector banks since the 1969 when all major
banks were nationalised by the Indian government.
However since liberalisation in government banking policy in the 1990s, old and new private
sector banks have re-emerged. They have grown faster & bigger over the two decades since
liberalisation using the latest technology, providing contemporary innovations and monetary
tools and techniques

PRIVATE SECTOR BANKS:

The private sector banks are split into two groups by financial regulators in India, old and
new.
o The old private sector banks existed prior to the nationalisation in 1969 and kept their
independence because they were either too small or specialist to be included in
nationalisation.
o The new private sector banks are those that have gained their banking license since
the liberalisation in the 1990s.

OLD PRIVATE SECTOR BANKS:

The banks, which were not nationalized at the time of bank nationalization that took place
during 1969 and 1980, are known to be the old private-sector banks. These were not
nationalized, because of their small size and regional focus.
Most of the old private-sector banks are closely held by certain communities their operations
are mostly restricted to the areas in and around their place of origin. Their Board of directors
mainly consist of locally prominent personalities from trade and business circles.
One of the positive points of these banks is that, they lean heavily on service and technology
and as such, they are likely to attract more business in days to come with the restructuring of
the industry round the corner.

List of the old private-sector banks in India

Name

Year
established

1. Bank of punjab merged with Centurion Bank to form Centurion Bank of

1943
Punjab in June 2005
2. City Union Bank
1904
3. Dhanlaxmi Bank
1927
4. Federal Bank
1931
5. ING Vysya Bank
1930
6. Jammu and Kashmir Bank
1938
7. Karnataka Bank
1924

8. Karur Vysya Bank

1916
9. Lakshmi Vilas Bank
1926
10. Nainital Bank
1922
11. Bipasa Bank
1943
12. SBI Commercial and international Bank
1955
13. South Indian Bank
1929
14. Tamilnad Mercantile Bank Limited
1921
15. Ratnakar Bank Ltd.
1943
16. IDB Bank Ltd (reverse merged with parent IDBI in 2004 to become IDBI
1964
Bank. Making this public sector bank private)
17. Catholic Syrian Bank
1920
NEW PRIVATE SECTOR BANKS:

The banks, which came in operation after 1991, with the introduction of economic
reforms and financial sector reforms are called "new private-sector banks".
Banking regulation act was then amended in 1993, which permitted the entry of new
private-sector banks in the Indian banking s sector.
However, there were certain criteria set for the establishment of the new private-sector
banks, some of those criteria being.
o The bank should have a minimum net worth of Rs. 200 crores.
o The promoters holding should be a minimum of 25% of the paid-up capital.
o Within 3 years of the starting of the operations, the bank should offer shares to
public and their net worth must increase to 300 crores.

List of the new private-sector banks in India

Name

Year

1. Axis Bank (earlier UTI Bank)

1994

2. Bank of Punjab (actually an old generation private bank since it was not founded
1989
under post-1993 new bank licensing regime)
3. Centurion Bank Ltd. (Merged Bank of Punjab in late 2005 to become Centurion
1994
Bank of Punjab, acquired by HDFC Bank Ltd. in 2008)
4. Development Credit Bank (Converted from Co-operative Bank, now DCB Bank
1995
Ltd.)
6. ICICI Bank (previously ICICI and then both merged; total merger
1996
SCICI+ICICI+ICICI Bank Ltd)

7. IndusInd Bank

1994

8. Kotak Mahindra Bank

2003

9. Yes Bank

2005

10. Times Bank (Merged with HDFC Bank Ltd.)

Unknown

11. Global Trust Bank (India) (Merged with Oriental Bank of Commerce)

Unknown

12. Balaji Corporation Bank Limited

2010

13. HDFC bank

1994

2. BRIEF HISTORY OF THE BANK

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 RBIs liberalisation of the Indian Banking Industry in
1994.
The bank was incorporated in August 1994 in the name of HDFC Bank Limited, with
its registered office in Mumbai, India.
HDFC Bank commenced operations as a Scheduled Commercial Bank in January 1995.
The bank was one of the first four companies, which subjected itself to a Corporate
Governance and Value Creation (GVC)
DISTRIBUTION NETWORK:

HDFC Bank is headquartered in Mumbai. As of September 30, 2014, the Banks

distribution network was at 3,600 branches in 2,272 cities.
All branches are linked on an online real-time basis.
Customers across India are also serviced through multiple delivery channels such as
Phone Banking, Net Banking, Mobile Banking and SMS based banking.
The Banks expansion plans take into account the need to have a presence in all major
industrial and commercial centers, 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 centers where the NSE / BSE have a strong and active member base.
The Bank also has a network of 11,515 ATMs across India. HDFC Banks ATM network
can be accessed by all domestic and international Visa / MasterCard, Visa Electron /

Maestro, Plus / Cirrus, Diners-Discover and American Express Credit / Charge

cardholders.
CAPITAL STRUCTURE:

As on March 31, 2014 the authorized share capital of the Bank is Rs. 550 crore.
The paid-up capital as on the said date is Rs 479, 81, 00,870/- (2399050435) equity
shares of Rs. 2/- each).
The HDFC Group holds 22.64 % of the Bank's equity and about 16.97 % of the equity is
held by the ADS / GDR Depositories (in respect of the bank's American Depository
Shares (ADS) and Global Depository Receipts (GDR) Issues).
34.11 % of the equity is held by Foreign Institutional Investors (FIIs) and the Bank has 4,
22,314 shareholders.
The shares are listed on the Bombay Stock Exchange Limited and the National Stock
Exchange of India Limited.
The Bank's American Depository Shares (ADS) are listed on the New York Stock
Exchange (NYSE) under the symbol 'HDB' and the Bank's Global Depository Receipts
(GDRs) are listed on Luxembourg Stock Exchange under ISIN No US40415F2002.
BUSINESS FOCUS:

HDFC Banks mission is to be a World Class Indian Bank.

The objective is to build sound customer franchises across distinct businesses so as to be
the preferred provider of banking services for target retail and wholesale customer
segments, and to achieve healthy growth in profitability, consistent with the banks risk
appetite.
The bank is committed to maintain the highest level of ethical standards, professional
integrity, corporate governance and regulatory compliance. HDFC Banks business
philosophy is based on five core values: Operational Excellence, Customer Focus,
Product Leadership, People and Sustainability.

3. USP OF THE BANK

It is market leader in mortgages. Its outstanding loan portfolio covers well over a million
dwelling units.
HDFC has developed significant expertise in retail mortgage loans to different market
segments and also has a large corporate client base for its housing related credit facilities.
With its experience in the financial markets, strong market reputation, large shareholder
base and unique consumer franchise, HDFC was ideally positioned to promote a bank in
the Indian environment.

4. MANAGEMENT:

Mr. C.M. Vasudev has been appointed as the Chairman of the Bank with effect from 6th
July 2010. Mr. Vasudev has been a Director of the Bank since October 2006. A retired
IAS officer, Mr. Vasudev has had an illustrious career in the civil services and has held
several key positions in India and overseas, including Finance Secretary, Government of
India, Executive Director, World Bank and Government nominee on the Boards of many
companies in the financial sector.
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.

5. PRODUCTS & SERVICES OF BANKING

1) Accounts & Deposits
Experience banking of the future with a bank account from HDFC Bank. A
world of smart features, multiple banking channels and prompt customer
service awaits you.
Savings Account

Choose an account to suit your needs from a basic banking account to a feature rich
premium option

Our accounts come with everything you require to make your day to day banking easy.
Plus more.

Salary Accounts

Customised salary accounts to suit the needs of every corporate

Expect benefits beyond the ordinary like our Free Insurance Cover

Current Accounts

Cost effective banking solutions for your businesses to maximize your cash-flow

Fast and efficient transactions to help you take advantage of every opportunity

Deposits

Whether you want to save regular amounts every month or in lump sum, we have a
solution for you

Competitive interest rates and flexibility to do more with your money

Safe Deposit Locker

Get one close to your work or home

Range of sizes to choose from

Rural Accounts

Everyday banking solutions for farmers

Accounts that understand your unique requirements

2) Loans
Whatever be your need, we have a loan for you. Choose HDFC Bank for quick check on
eligibility, competitive interest rates, flexible terms, minimum paperwork and fast disbursal.
Personal Loan

Personal Loan eligibility in 1 minute available online & across all branches

Loan in your account in 2 days*

Special loan offers* for women employees

Business Loan

Check eligibility in just 1 minute online & across all branches

Simple documentation

Speedy approvals

Home Loan

Pioneer in the Home Loan industry

4.4 Million satisfied home owners

Faster processing of loan with door step service

Car Loans

Faster approvals and doorstep services

Widest range of authorized dealers

Pre-approved cash loan for existing Car Loan customers

Two Wheeler Loans

2% lower rate and 50% discount on processing fees for account holders

Savings up to Rs. 2375/-

Loan approval in 4 hours

Gold Loan

Safe: Unique triple layered security for your gold

Quick: spot sanction and disbursal

Easy: One page documentation

Loans Against Assets

The smart way to meet all your financial needs; be it business or personal needs.

Best in class product offering

Flexibility in repayment

Educational Loan

Get loans up to Rs. 10 lacs for education in India

Get our service at your doorstep

Government Sponsored Programs

HDFC Bank participates in a variety of Government Sponsored Programs to support the

lesser privileged strata of the society

These schemes assist socially backward classes and help increase employment generation

Rural Loans

Easy documentation and speedy approvals, getting a loan couldnt get any easier.

Tractor Loans available for farmers and non-farmers to buy new or pre-owned tractors!

3) Cards
Explore a world of convenience, customized benefits, rewards and Smart buy cash back offers
with credit and debit cards from HDFC Bank.

Credit Card

Debit Card

Pre-Paid Card

Credit Card Reward Program

Loan on Credit Card

4) Demat
Presenting flexible demat accounts. From simple demat accounts to 3 in 1 accounts offering a
combination of demat, trading and savings accounts making investing easy!

2 in 1 Account

3 in 1 Account

5) Investments
Ensure your hard-earned money is working hard for you. Explore investment opportunities with
HDFC Bank. Choose from an array of financial products like mutual funds, stocks, etc.

Distribution of Financial Products

Investment Products

Investment Advisory Report

6) Forex
Benefit from HDFC Banks wide network of correspondent banks and representatives across the
globe. Organise all your foreign exchange when travelling abroad through us - from cash to
multicurrency Forex card you can get it all from any HDFC Bank branch.
Travel Solutions

Forex facilities across all HDFC Bank Branches

Foreign currency cash in 21 currencies

Remittances in 18 major currencies

Multi-currency chip-based Forex Cards 12 currencies in one card

Remittance Products

Quick and reliable Remittances

Service at competitive rates

Foreign Currency Demand Drafts in 10 currencies

Cheque Collection in 16 currencies

Other Forex Services

Cash to Master facility for foreign ships travelling through India

Forex Help

View current FOREX rates

Check Correspondent Bank details

View Foreign Exchange limits

7) Premium Banking
Experience personalized banking like never before. HDFC Bank extends the services of a
dedicated relationship manager for delivering customized banking and investments solutions to
meet your needs.
8) Private Banking
Bespoke banking and advisory services for the truly discerning. Make the much awarded Private
Banking service from HDFC Bank your preferred choice

6. COMPETITIVE POSITION:
SWOT Analysis:
Private Banking Sector:Strengths:

All the private banks have professional, dedicated and well-trained manpower.
In contrast to their public sector counterparts, efficiency is maintained at the
highest level.
The new private banks have commenced with strong financials and with a clean slate i.e.
without having to pursue NPAs.
Almost all these banks have complied with Capital Adequacy
r e q u i r e m e n t s a n d prudential norms.
Most of these banks are fully computerized and techno-savvy

Weaknesses:

Both old and new private banks are operating in a limited area confined to a region.
Although highly networked, the number of branches are limited.
The employee turnover appears to be on higher side.
There is dissimilarity between old and new private banks by virtue of their age,
functional area, products and services, etc.

Opportunities:

Being in private sector, these banks enjoy high level of autonomy facilitating
them for faster decision making.
To face stiff competition, they can innovate new products and services and achieve high
customer satisfaction.
With full computerization, they can offer cost-effective services like ATMs, electronic
fund Transfer, etc.

Threats:

Expansion of foreign banks in the post WTO era poses severe competition.
Dominant PSBs which are recharged with a high market share will
o v e r - s h a d o w t h e private sector banks.
Frequent announcements of takeover / Mergers & Acquisitions by PSBs as
well as new private sector banks disturb the very functioning of old private sector
banks.
RBI / GOI relaxation of FDI investment norms cause worry among the managements.

HDFC Bank:
Strengths

HDFC bank is the second largest private banking sector in India having 3,600 branches
and 11,515 ATMs

HDFC bank is located in 2,272 cities in India and has more than 800 locations to serve
customers through Telephone banking

The banks ATM card is compatible with all domestic and international Visa/Master card,
Visa Electron/ Maestro, Plus/cirus and American Express. This is one reason for HDFC
cards to be the most preferred card for shopping and online transactions

HDFC has lots of awards and recognition, it has received Best Bank award from various
financial rating institutions like Dun and Bradstreet, Financial express, Euromoney
awards for excellence, Finance Asia country awards etc

HDFC has good financial advisors in terms of guiding customers towards right
investments

Weakness

HDFC bank doesnt have strong presence in Rural areas.

HDFC lacks in aggressive marketing strategies.

The bank focuses mostly on high end clients.

Some of the banks product categories lack in performance and doesnt have reach in the
market

Opportunities

HDFC bank has better asset quality parameters over government banks, hence the profit
growth is likely to increase

The companies in large and SME are growing at very fast pace. HDFC has good
reputation in terms of maintaining corporate salary accounts

HDFC has very good opportunities in abroad

Greater scope for acquisitions and strategic alliances due to strong financial position

Threats

HDFCs nonperforming assets (NPA) increased from 0.20 % to 0.27%. Though it is a

slight variation its not a good sign for the financial health of the bank

The non-banking financial companies and new age banks are increasing in India

The government banks are trying to modernize to compete with private banks

RBI has opened up to 74% for foreign banks to invest in Indian market