1) INTRODUCTION OF SBI BANK

State Bank of India (SBI) is the largest commercial bank in India in terms of assets, deposits,
profits, branches, customers and employees. The Government of India itself is the largest
shareholder of this Fortune 500 company, with 58.60% ownership, and SBI was ranked 152 nd in
The Forbes list of Global 2000 firms in May 2015

The origins of State Bank of India date back to 1806 when the Bank of Calcutta (later called the
Bank of Bengal) was established. In 1921, the Bank of Bengal and two other banks (Bank of
Madras and Bank of Bombay) were amalgamated to form the Imperial Bank of India. In 1955,
the Reserve Bank of India acquired the controlling interests of the Imperial Bank of India and
SBI was created by an act of Parliament to succeed the Imperial Bank of India.

The SBI group consists of SBI and five associate banks. The group has an extensive network,
with over 20000 plus branches in India and another 186 offices in 34 countries across the world.
As of 31st March 2013, the group had assets worth USD 392 billion, deposits of USD 299 billion
and capital & reserves in excess of USD 23.03 billion. The group commands over 23% share of
the domestic Indian banking market.

SBI’s non- banking subsidiaries/joint ventures are market leaders in their respective areas and
provide wide ranging services, which include life insurance, merchant banking, mutual funds,
credit cards, factoring services, security trading and primary dealership, making the SBI Group a
truly large financial supermarket and India’s financial icon. SBI has arrangements with over
1500 various international / local banks to exchange financial messages through SWIFT in all
business centers of the world to facilitate trade related banking business, reinforced by dedicated
and highly skilled teams of professionals.’
State Bank of India is one of the Big Four banksof India, along with ICICI Bank, Bank of
Baroda and Punjab National Bank. The bank traces its ancestry to British India, through
the Imperial Bank of India, to the founding, in 1806, of the Bank of Calcutta, making it the oldest
commercial bank in the Indian Subcontinent. Bank of Madras merged into the other two
"presidency banks" in British India, Bank of Calcutta and Bank of Bombay, to form the Imperial
Bank of India, which in turn became the State Bank of India in 1956.Government of India owned
the Imperial Bank of India in 1955, with Reserve Bank of India (India's Central Bank) taking a
60% stake, and renamed it the State Bank of India. In 2008, the government took over the stake
held by the Reserve Bank of India.

State Bank of India is a banking behemoth and has 20% market share in deposits and loans
among Indian commercial banks.

Figure1:SBI Shareholding pattern

SBI Shareholding (%)

Promoters
Banks/FIs
FIIs
Insurance
Mutual Funds
Indian Public
Custodians
Other
 Table 1: Profit and loss of SBI Bank

PARTICULARS Mar-12 Mar-13 Mar-14 Mar-15 Mar-16 Mar-17

INCOME
Interest / Discount on 102,484.1
Advances / Bills 81,077.70 90,537.10 0 112,343.91 115,666.01
Income from Investments 23,949.14 27,200.63 31,941.87 37,087.77 42,303.98
Interest on Balance with RBI
and Other Inter-Bank funds 350.47 545.14 409.31 505.12 621.07
Others 1,144.14 1,374.23 1,515.52 2,460.27 5,094.25
106,521.4 136,350.8 175,518.2
Total Interest Earned 5 119,657.10 0 152,397.07 163,685.31 4
Other Income 14,351.45 16,034.84 18,552.92 22,575.89 28,158.36 35,460.93
120,872.9 154,903.7 210,979.1
Total Income 0 135,691.94 2 174,972.96 191,843.67 7
EXPENDITURE
Interest Expended 63,230.37 75,325.80 87,068.63 97,381.82 106,803.49 113,658.50
Payments to and Provisions 26,489.28
for Employees 16,974.04 18,380.90 22,504.28 23,537.07 25,113.82
Depreciation 1,007.17 1,139.61 1,333.94 1,116.49 1,700.30 2,293.31
Operating Expenses
(excludes Employee Cost &
Depreciation) 8,087.78 9,763.91 11,887.63 14,024.08 14,968.24
Total Operating Expenses 26,068.99 29,284.42 35,725.85 38,677.64 41,782.37 46,472.78
Provision Towards Income
Tax 6,335.37 5,951.06 4,227.47 6,689.95 3,577.93
Provision Towards Deferred
Tax 455.93 -107.97 1,055.25 -477.56 245.47
Provision Towards Other
Taxes 6.00 2.82 0 0 0
Other Provisions and
Contingencies 13,068.95 11,130.83 15,935.35 19,599.54 29,483.75
Total Provisions and
Contingencies 19,866.25 16,976.74 21,218.07 25,811.93 33,307.15
109,165.6 144,012.5 200,495.0
Total Expenditure 1 121,586.96 5 161,871.39 181,893.01 7
Net Profit / Loss for The 10,484.10
Year 11,707.29 14,104.98 10,891.17 13,101.57 9,950.65
Net Profit / Loss After EI &
Prior Year Items 11,707.29 14,104.98 10,891.17 13,101.57 9,950.65
Profit / Loss Brought
Forward 0.34 0.34 0.34 0.32 0.32 0.32
Total Profit / Loss available
for Appropriations 11,713.34 14,105.32 10,891.51 13,101.89 9,950.98 10,484.42
APPROPRIATIONS
Transfer To / From Statutory
Reserve 3,516.98 4,417.86 3,339.62 4,029.08 2,985.20
Transfer To / From Capital
Reserve 14.38 19.17 0 0 345.27
Transfer To / From Revenue
And Other Reserves 5,536.50 6,453.26 5,013.40 5,994.56 4,267.35
Dividend and Dividend Tax
for The Previous Year 0.00 0 0.01 0 0.01
Equity Share Dividend 2,348.66 2,838.74 2,239.71 2,557.28 2,018.32
Tax On Dividend 296.49 375.95 298.45 520.65 334.51
Balance Carried Over To
Balance Sheet 0.34 0.34 0.32 0.32 0.32
Total Appropriations 11,713.34 14,105.32 10,891.51 13,101.89 9,950.98
OTHER INFORMATION
EARNINGS PER SHARE
Basic EPS (Rs.) 184.31 210.06 156.76 17.55 12.98
Diluted EPS (Rs.) 184.31 210.06 156.76 17.55 12.98
DIVIDEND PERCENTAGE
Equity Dividend Rate (%) 350 415 300 350 260
Table 2: Balance Sheet of SBI
PARTICULARS Mar-12 Mar-13 Mar-14 Mar-15 Mar-16 Mar-17
EQUITIES AND
LIABILITIES
SHAREHOLDER'S
FUNDS
Equity Share Capital 671.04 684.03 746.57 746.57 776.28
Total Share Capital 671.04 684.03 746.57 746.57 776.28
Reserves and Surplus 83,280.16 98,199.65 117,535.68 127,691.65 143,498.16
Total Reserves and
Surplus 83,280.16 98,199.65 117,535.68 127,691.65 143,498.16
Total ShareHolders
Funds 83,951.21 98,883.69 118,282.25 128,438.22 144,274.44
Deposits 1,043,647.36 1,202,739.57 1,394,408.51 1,576,793.24 1,730,722.44
Borrowings 127,005.57 169,182.71 183,130.88 205,150.29 224,190.59
Other Liabilities and
Provisions 80,915.09 95,455.07 96,412.96 137,698.05 159,875.57
Total Capital and
Liabilities 1,335,519.23 1,566,261.04 1,792,234.60 2,048,079.80 2,259,063.03
ASSETS
Cash and Balances
with Reserve Bank of
India 54,075.94 65,830.41 84,955.66 115,883.84 129,629.33
Balances with Banks
Money at Call and
Short Notice 43,087.23 48,989.75 47,593.97 58,977.46 37,838.33
Investments 312,197.61 350,927.27 398,308.19 495,027.40 477,097.28
Advances 867,578.89 1,045,616.55 1,209,828.72 1,300,026.39 1,463,700.42
Fixed Assets 5,466.55 7,005.02 8,002.16 9,329.16 10,389.28
Other Assets 53,113.02 47,892.03 43,545.90 68,835.55 140,408.41
Total Assets 1,335,519.23 1,566,261.04 1,792,234.60 2,048,079.80 2,259,063.03
OTHER
ADDITIONAL
INFORMATION
Number of Branches 14,270.00 15,002.00 16,059.00 16,524.00 16,784.00
Number of Employees 215,481.00 228,296.00 222,033.00 213,238.00 207,739.00
Capital Adequacy
Ratios (%) 14.00 13 13 12 13
KEY
PERFORMANCE
INDICATORS
Tier 1 (%) 10.00 9 10 10 10
Tier 2 (%) 4.00 3 3 2 3
ASSETS QUALITY
Gross NPA 39,676.46 51,189.39 61,605.00 56,725.00 98,172.80
Gross NPA (%) 5.00 5 5 4 7
Net NPA 15,818.85 21,956.48 0 0 55,807.02
 2) SWOT Analysis of SBI

Strengths

 SBI is the largest bank in India in terms of market share, revenue and assets.
 As per recent data the bank has more than 20000 plus branches and 25,000 plus ATM
centres
 The bank has its presence in 32 countries engaging currency trade all over the world
 The bank has a merged with State Bank of Saurashtra, State bank of Indore and all other
state bank are going merge together with SBI which will increase the efficiency of SBI.
 SBI has the first mover advantage in commercial banking service
 SBI has recently changed its vision and mission statements showing a sign of inclination
towards new age banking services

Weakness

 Lack of proper technology driven services when compared to private banks

Employees show reluctance to solve issues quickly due to higher job security and
customers’ waiting period is long when compared to private banks
 The banks spends a huge amount on its rented buildings
 SBI has the largest number of employees in banking sector, hence the bank spends a
considerable amount of its income in employee’s salary compensation
 In spite of modernization, the bank still carries the perception of traditional bank to new
age customers
 SBI fails to attract salary accounts of corporate and many government sector employees
salary accounts are also shifted to private bank for ease of operations unlike before
Opportunities

 SBI’s merger with five more banks namely State Bank of Hyderabad, State bank of
Patiala, State bank of Bikaner and Jaipur, State of bank of Travancore and State bank of
Mysore has been approved and it will merge soon
 Mergers will result in expansion of market share to defend its number one position
SBI is planning to expand and invest in international operations due to good inflow of
money from Asian Market
 Since the bank is yet to modernize few of its banking operations, there is a better scope of
using advanced technologies and software to improve customer relations
 Young and talented pool of graduates and B schools are in rise to open new horizon to so
called “old government bank”

Threats

 Net profit of the year has decline from 13101.57cr in the year FY 2015 to 9950.65cr in
the year FY2016
 This shows the reduce in market share to its close competitor ICICI
other private banks like HDFC, AXIS Bank etc.
 FDIs allowed in banking sector is increased to 49% , this is a major threat to SBI as
people tend to switch to foreign banks for better facilities and technologies in banking
service
 Other governments banks like PNB, Andhra, Allahabad bank and Indian bank are
showing
Customer prefer to switch to private banks and financial service providers for loans and
mortgages, as SBI involves stringent verification procedures and take long time for
processing.

3) Introduction of ICICI bank

ICICI Bank is India's largest private sector bank with total assets of Rs. 6,461.29 billion (US$
103 billion) at March 31, 2015 and profit after tax Rs. 111.75 billion (US$ 1,788 million) for the
year ended March 31, 2015. ICICI Bank currently has a network of 4,450 Branches and 13,993
ATM's across India.

ICICI Bank was originally promoted in 1994 by ICICI Limited, an Indian financial institution,
and was its wholly-owned subsidiary. ICICI's shareholding in ICICI Bank was reduced to 46%
through a public offering of shares in India in fiscal 1998, an equity offering in the form of ADRs
listed on the NYSE in fiscal 2000, ICICI Bank's acquisition of Bank of Madura Limited in an all-
stock amalgamation in fiscal 2001, and secondary market sales by ICICI to institutional investors
in fiscal 2001 and fiscal 2002. ICICI was formed in 1955 at the initiative of the World Bank, the
Government of India and representatives of Indian industry. The principal objective was to create
a development financial institution for providing medium-term and long-term project financing
to Indian businesses.

In the 1990s, ICICI transformed its business from a development financial institution offering
only project finance to a diversified financial services group offering a wide variety of products
and services, both directly and through a number of subsidiaries and affiliates like ICICI Bank.
In 1999, ICICI become the first Indian company and the first bank or financial institution from
non-Japan Asia to be listed on the NYSE.

After consideration of various corporate structuring alternatives in the context of the emerging
competitive scenario in the Indian banking industry, and the move towards universal banking, the
managements of ICICI and ICICI Bank formed the view that the merger of ICICI with ICICI
Bank would be the optimal strategic alternative for both entities, and would create the optimal
legal structure for the ICICI group's universal banking strategy. The merger would enhance value
for ICICI shareholders through the merged entity's access to low-cost deposits, greater

Opportunities for earning fee-based income and the ability to participate in the payments system
and provide transaction-banking services. The merger would enhance value for ICICI Bank
shareholders through a large capital base and scale of operations, seamless access to ICICI's
strong corporate relationships built up over five decades, entry into new business segments,
higher market share in various business segments, particularly fee-based services, and access to
the vast talent pool of ICICI and its subsidiaries.

In October 2001, the Boards of Directors of ICICI and ICICI Bank approved the merger of ICICI
and two of its wholly-owned retail finance subsidiaries, ICICI Personal Financial Services
Limited and ICICI Capital Services Limited, with ICICI Bank. The merger was approved by
shareholders of ICICI and ICICI Bank in January 2002, by the High Court of Gujarat at
Ahmedabad in March 2002, and by the High Court of Judicature at Mumbai and the Reserve
Bank of India in April 2002.

Figure 2: ICICI Bank Shareholding pattern

ICICI Bank Shareholding (%)

Promoters
Individuals
Institutions
FII
Govt.
Others

Table3:Profit and loss of ICICI Bank

PARTICULARS Mar-12 Mar-13 Mar-14 Mar-15 Mar-16 Mar-17
INCOME
Interest / Discount on
Advances / Bills 22,129.89 27,341.11 31,427.93 35,631.08 38,943.15
Income from Investments 9,684.02 11,009.27 11,557.06 11,944.57 10,625.35
Interest on Balance with RBI
and Other Inter-Bank funds 491.14 542.98 199.98 195.1 158.24
Others 1,237.60 1,182.24 993.19 1,320.39 3,012.69
Total Interest Earned 33,542.65 40,075.60 44,178.15 49,091.14 52,739.43
Other Income 7,502.76 8,345.70 10,427.87 12,176.13 15,323.05
Total Income 41,045.41 48,421.30 54,606.02 61,267.27 68,062.49
EXPENDITURE
Interest Expended 22,808.50 26,209.18 27,702.59 30,051.53 31,515.39
Payments to and Provisions
for Employees 3,515.28 3,893.29 4,220.11 4,749.88 3,012.69
Depreciation 482.27 457.34 544.27 623.89 679.29
Depreciation on Leased
Assets 42.26 32.82 31.7 35.06 19.22
Operating Expenses
(excludes Employee Cost &
Depreciation) 3,810.63 4,629.44 5,512.79 6,087.01 8,972.36
Total Operating Expenses 7,850.44 9,012.88 10,308.86 11,495.83 12,683.56
Provision Towards Income
Tax 2,187.42 2,998.20 3,839.50 4,859.14 5,788.61
Provision Towards Deferred
Tax 144.65 66.02 313.19 -219.57 -3,319.18
Provision Towards Other
Taxes 6.1 7 5 5 0
Other Provisions and
Contingencies 1,583.05 1,802.54 2,626.41 3,899.99 11,667.82
Total Provisions and
Contingencies 3,921.22 4,873.76 6,784.10 8,544.56 14,137.25
Total Expenditure 34,580.15 40,095.83 44,795.55 50,091.92 58,336.20
Net Profit / Loss for The
Year 6,465.26 8,325.47 9,810.48 11,175.35 9,726.29
Net Profit / Loss After EI &
Prior Year Items 6,465.26 8,325.47 9,810.48 11,175.35 9,726.29
Profit / Loss Brought
Forward 5,018.18 7,054.23 9,902.29 13,318.59 17,261.42
Total Profit / Loss available
for Appropriations 11,483.44 15,379.71 19,712.76 24,493.94 26,987.70
APPROPRIATIONS
Transfer To / From Statutory
Reserve 1,617.00 2,082.00 2,453.00 2,793.90 2,431.60
Transfer To / From Reserve
Fund 1.07 2.78 4.61 0.77 0.93
Transfer To / From Special
Reserve 650 760 900 1,100.00 1,350.00
Transfer To / From Capital
Reserve 38 33 76 291.93 2,382.24
Transfer To / From General
Reserve 0.32 0 0 0 0
Transfer To / From
Investment Reserve 0 0 127 -127 0
Transfer To / From Revenue
And Other Reserves 0 0 0 0 500
Dividend and Dividend Tax
for The Previous Year 0.43 0.25 -53.97 2.98 3.85
Equity Share Dividend 1,902.04 2,307.23 2,656.28 2,898.81 2,907.52
Tax On Dividend 220.35 292.16 231.25 271.15 279.37
Balance Carried Over To
Balance Sheet 7,054.23 9,902.29 13,318.59 17,261.42 17,132.19
Total Appropriations 11,483.44 15,379.71 19,712.76 24,493.94 26,987.70
OTHER INFORMATION
EARNINGS PER SHARE
Basic EPS (Rs.) 56.11 72.2 84.99 19.32 16.75
Diluted EPS (Rs.) 55.95 71.93 84.65 19.13 16.65
DIVIDEND PERCENTAGE
Equity Dividend Rate (%) 165 200 230 250 250
 Table 4: Balance Sheet of ICICI

PARTICULARS Mar-12 Mar-13 Mar-14 Mar-15 Mar-16 Mar-17

EQUITIES AND
LIABILITIES
SHAREHOLDER'S
FUNDS
Equity Share Capital 1,152.77 1,153.64 1,155.04 1,159.66 1,163.17
Total Share Capital 1,152.77 1,153.64 1,155.04 1,159.66 1,163.17
Revaluation Reserve 0 0 0 0 2,817.47
Reserves and Surplus 59,250.09 65,547.84 72,051.71 79,262.26 85,748.24
Total Reserves and Surplus 59,250.09 65,547.84 72,051.71 79,262.26 88,565.72
Employees Stock Options 2.39 4.48 6.57 7.44 6.7
Total Shareholders’ Funds 60,405.24 66,705.96 73,213.33 80,429.36 89,735.58
Deposits 255,499.96 292,613.63 331,913.66 361,562.73 421,425.71
Borrowings 140,164.91 145,341.49 154,759.05 172,417.35 174,807.38
Other Liabilities and
Provisions 17,576.98 32,133.60 34,755.55 31,719.86 34,726.44
Total Capital and Liabilities 473,647.09 536,794.68 594,641.58 646,129.29 720,695.10
ASSETS
Cash and Balances with
Reserve Bank of India 20,461.29 19,052.73 21,821.83 25,652.91 27,106.09
Balances with Banks Money
at Call and Short Notice 15,768.02 22,364.79 19,707.77 16,651.71 32,762.65
Investments 159,560.04 171,393.60 177,021.82 186,580.03 160,411.80
Advances 253,727.66 290,249.44 338,702.65 387,522.07 435,263.94
Fixed Assets 4,614.69 4,647.06 4,678.14 4,725.52 7,576.92
Other Assets 19,515.39 29,087.07 32,709.39 24,997.05 57,573.70
Total Assets 473,647.09 536,794.68 594,641.58 646,129.29 720,695.10
OTHER ADDITIONAL
INFORMATION
Number of Branches 2,752.00 3,100.00 3,753.00 4,050.00 4,450.00
Number of Employees 58,276.00 62,065.00 72,226.00 66,327.00 72,175.00
Capital Adequacy Ratios (%) 19 19 18 17 17
KEY PERFORMANCE
INDICATORS
Tier 1 (%) 13 13 13 13 13
Tier 2 (%) 6 6 5 4 4
ASSETS QUALITY
Gross NPA 9,475.33 9,607.75 10,505.84 15,094.69 26,221.25
Gross NPA (%) 0 0 0 4 6
Net NPA 1,860.84 2,230.56 3,297.96 6,255.53 12,963.08
Net NPA (%) 1 1 1 2 3
Net NPA To Advances (%) 1 1 1 2 3
CONTINGENT
LIABILITIES,
COMMITMENTS
Bills for Collection 7,572.06 12,394.53 13,534.91 16,212.97 68,932.74
Contingent Liabilities 915,465.11 789,989.31 781,430.45 851,977.61 853,520.77
 4) Swot Analysis of ICICI bank

Strengths of ICICI Bank

 ICICI is the second largest bank in terms of total assets and market share
 Total assets of ICICI areRs. 6461.29 Billion and recorded a profit after tax of Rs. 111.75
billion at March 2015.
 One of the major strength of ICICI bank according to financial analysts is its strong and
transparent balance sheet
 ICICI bank has first mover advantage in many of the banking and financial services.
ICICI bank is the first bank in India to introduce complete mobile banking solutions and jewelry
card
 The bank has PAN India presence of around 4450 branches and 13993 ATM’s
 ICICI bank is the first bank in India to attach life style benefits to banking services for
exclusive purchases and tie-ups with best brands in the industry such as Nakshatra, Asmi,
D’damasetc.
 ICICI bank has the longest working hours and additional services offering at ATM’s
which attracts customers
 Marketing and advertising strategies of ICICI have good reach compared to other banks
in India

Weaknesses of ICICI Bank

 Customer support of ICICI section is not performing well in terms of resolving

complaints
 There are lot of consumer complaints filed against ICICI
 The ICICI bank has the most stringent policies in terms of recovering the debts and loans,
and credit payments. They employ third party agency to handle recovery management
 There are also complaints of customer assault and abuse while recovering and the credit
payment reminders are sent even before the deadlines which annoys the customers
 The bank service charges are comparatively higher
 The employees of ICICI are bank in maximum stress because of the aggressive policies
of the management to win ahead in the race. This may result in less productivity in future years

Opportunities of ICICI Bank

 Banking sector is expected to grow at a rate of 17% in the next three years
 The concept of saving in banks and investing in financial products is increasing in rural
areas as more than 62% percentage of India’s population is still in rural areas.
 Within next four years ICICI bank is planning to open 1500 new branches
 Small and non performing banks can be acquired by ICICI because of its financial
strength
 ICICI bank is expected to have 20% credit growth in the coming years.
 ICICI bank has the minimum amount of non-performing assets

Threats of ICICI Bank

 RBI allowed foreign banks to invest up to 74% in Indian banking

 Government sector banks are in urge of modernizing the capacities to ensure the
customers switching to new age banks are minimized
 In rural areas the micro financing groups hold a major share
 HDFC is the major competitor for ICICI, and other upcoming banks like AXIS, HSBC
impose a major threat
 Though customer acquisition is high on one side, the unsatisfied customers are increasing
and make them to switch to other banks