Company profile IDBI Bank Ltd. is today one of India's largest commercial Banks.

For over 40 years, IDBI Bank has essayed a key nation-b ilding role, first as the a!e" Develo!ment Financial Instit tion #DFI$ #% ly &, &'(4 to )e!tember *0, +004$ in the realm of ind stry and thereafter as a f ll-service commercial Bank #,ctober &, +004 on-ards$. .s a DFI, the erst-hile IDBI stretched its canvas beyond mere !ro/ect financing to cover an array of services that contrib ted to-ards balanced geogra!hical s!read of ind stries, develo!ment of identified back-ard areas, emergence of a ne- s!irit of enter!rise and evol tion of a dee! and vibrant ca!ital market. ,n ,ctober &, +004, the erst-hile IDBI converted into a Banking com!any #as Ind strial Develo!ment Bank of India Limited$ to ndertake the entire gam t of Banking activities -hile contin ing to !lay its sec lar DFI role. 0ost the mergers of the erst-hile IDBI Bank -ith its !arent com!any #IDBI Ltd.$ on .!ril +, +001 #a!!ointed date2 ,ctober &, +004$ and the s bse3 ent merger of the erst-hile 4nited 5estern Bank Ltd. -ith IDBI Bank on ,ctober *, +00(, the tech-savvy, ne- generation Bank -ith ma/ority 6overnment shareholding today to ches the lives of millions of Indians thro gh an array of cor!orate, retail, )78 and .gri !rod cts and services. 9ead3 artered in 7 mbai, IDBI Bank today rides on the back of a rob st b siness strategy, a highly com!etent and dedicated -orkforce and a state-of-the-art information technology !latform, to str ct re and deliver !ersonalised and innovative Banking services and c stomised financial sol tions to its clients across vario s delivery channels.

Industry introduction :he Indian Banking ind stry, -hich is governed by the Banking ;eg lation .ct of India, &'4' can be broadly classified into t-o ma/or categories, non-sched led banks and sched led banks. )ched led banks com!rise commercial banks and the co-o!erative banks. In terms of o-nershi!, commercial banks can be f rther gro !ed into nationali<ed banks, the )tate Bank of India and its gro ! banks, regional r ral banks and !rivate sector banks #the old= ne- domestic and foreign$. :hese banks have over (>,000 branches s!read across the co ntry in every city and villages of all nook and corners of the land. :he first !hase of financial reforms res lted in the nationali<ation of &4 ma/or banks in &'(' and res lted in a shift from ?lass banking to 7ass banking. :his in t rn res lted in a significant gro-th in the geogra!hical coverage of banks. 8very bank had to earmark a minim m !ercentage of their loan !ortfolio to sectors identified as @!riority sectorsA. :he man fact ring sector also gre- d ring the &'>0s in !rotected environs and the banking sector -as a critical so rce. :he ne"t -ave of reforms sa- the nationali<ation of ( more commercial banks in &'B0. )ince then the n mber of sched led commercial banks increased fo r-fold and the n mber of bank branches increased eight-fold. .nd that -as not the limit of
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gro-th.

.fter the second !hase of financial sector reforms and liberali<ation of the sector in the early nineties, the 0 blic )ector Banks #0)B$ s fo nd it e"tremely diffic lt to com!ete -ith the ne- !rivate sector banks and the foreign banks. :he ne!rivate sector banks first made their a!!earance after the g idelines !ermitting them -ere iss ed in %an ary &''*. 8ight ne- !rivate sector banks are !resently in o!eration. :hese banks d e to their late start have access to state-of-the-art technology, -hich in t rn hel!s them to save on man!o-er costs.

D ring the year +000, the )tate Bank ,f India #)BI$ and its > associates acco nted for a +1 !ercent share in de!osits and +B.& !ercent share in credit. :he +0 nationali<ed banks acco nted for 1*.+ !ercent of the de!osits and 4>.1 !ercent of credit d ring the same !eriod. :he share of foreign banks #n mbering 4+$, regional r ral banks and other sched led commercial banks acco nted for 1.> !ercent, *.' !ercent and &+.+ !ercent res!ectively in de!osits and B.4& !ercent, *.&4 !ercent and &+.B1 !ercent res!ectively in credit d ring the year +000.abo t

the detail of the c rrent scenario -e -ill go thro gh the trends in modern economy of the co ntry.

Current Scenario: :he ind stry is c rrently in a transition !hase. ,n the one hand, the 0)Bs, -hich are the mainstay of the Indian Banking system are in the !rocess of shedding their flab in terms of e"cessive man!o-er, e"cessive non 0erforming .ssets #C!as$ and e"cessive governmental e3 ity, -hile on the other hand the !rivate sector banks are consolidating themselves thro gh mergers and ac3 isitions.

0)Bs, -hich c rrently acco nt for more than >B !ercent of total banking ind stry assets are saddled -ith C0.s #a mind-boggling ;s B*0 billion in +000$, falling reven es from traditional so rces, lack of modern technology and a massive -orkforce -hile the ne- !rivate sector banks are forging ahead and re-riting the traditional banking b siness model by -ay of their

sheer innovation and service. :he 0)Bs are of co rse c rrently -orking o t challenging strategies even as +0 !ercent of their massive em!loyee strength has d-indled in the -ake of the s ccessf l Dol ntary ;etirement )chemes #D;)$ schemes.

:he !rivate !layers ho-ever cannot match the 0)BEs great reach, great si<e and access to lo- cost de!osits. :herefore one of the means for them to combat the 0)Bs has been thro gh the merger and ac3 isition #7F .$ ro te. ,ver the last t-o years, the ind stry has -itnessed several s ch instances. For instance, 9DF? BankEs merger -ith :imes Bank Icici BankEs ac3 isition of I:? ?lassic, .nagram Finance and Bank of 7ad rai. ?ent rion Bank, Ind sind Bank, Bank of 0 n/ab, Dysya Bank are said to be on the looko t. :he 4:I bank- 6lobal :r st Bank merger ho-ever o!ened a !andoraEs bo" and bro ght abo t the reali<ation that all -as not -ell in the f nctioning of many of the !rivate sector banks.

0rivate sector Banks have !ioneered internet banking, !hone banking, any-here banking, mobile banking, debit cards, . tomatic :eller 7achines #.:7s$ and combined vario s other services and integrated them into the mainstream banking arena, -hile the 0)Bs are still gra!!ling -ith disgr ntled em!loyees in the aftermath of s ccessf l D;) schemes. .lso, follo-ing IndiaEs commitment to the
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5 :o agreement in res!ect of the services sector, foreign banks, incl ding both ne- and the e"isting ones, have been !ermitted to o!en ! to &+ branches a year -ith effect from &''B-'' as against the earlier sti! lation of B branches. :asks of government dil ting their e3 ity from 1& !ercent to ** !ercent in Covember +000 has also o!ened ! a ne- o!!ort nity for the takeover of even the 0)Bs. :he FDI r les being more

rationali<ed in G&FH0+ may also !ave the -ay for foreign banks taking the 7F . ro te to ac3 ire -illing Indian !artners. 7ean-hile the economic and cor!orate sector slo-do-n has led to an increasing n mber of banks foc sing on the retail segment. 7any of them are also entering the ne- vistas of Ins rance. Banks -ith their !henomenal reach and a reg lar interface -ith the retail investor are the best !laced to enter into the ins rance sector. Banks in India have been allo-ed to !rovide fee-based ins rance services -itho t risk !artici!ation, invest in an ins rance com!any for !roviding infrastr ct re and services s !!ort and set ! of a se!arate /oint-vent re ins rance com!any -ith risk !artici!ation.

Aggregate Performance of the Banking Industry .ggregate de!osits of sched led commercial banks increased at a com!o nded ann al average gro-th rate #?agr$ of &>.B !ercent d ring &'('-'', -hile bank credit e"!anded at a ?agr of &(.* !ercent !er ann m. BanksE investments in government and other a!!roved sec rities recorded a ?agr of &B.B !ercent !er ann m d ring the same !eriod. In FH0& the economic slo-do-n res lted in a 6ross Domestic 0rod ct #6D0$ gro-th of only (.0 !ercent as against the !revio s yearEs (.4 !ercent. :he 50I Inde" #a meas re of inflation$ increased by >.& !ercent as against *.* !ercent in FH00. )imilarly, money s !!ly #7*$ gre- by aro nd &(.+ !ercent as against &4.( !ercent a year ago. :he gro-th in aggregate de!osits of the sched led commercial banks at &1.4 !ercent in FH0& !ercent -as lo-er than that of &'.* !ercent in the !revio s year, -hile the gro-th in credit by

)?Bs slo-ed do-n to &1.( !ercent in FH0& against +* !ercent a year ago.

:he ind strial slo-do-n also affected the earnings of listed banks. :he net !rofits of +0 listed banks dro!!ed by *4.4* !ercent in the 3 arter ended 7arch +00&. Cet !rofits gre- by 40.>1 !ercent in the first 3 arter of +000-+00&, b t dro!!ed to 4.1( !ercent in the fo rth 3 arter of +000-+00&. ,n the ?a!ital .de3 acy ;atio #?.;$ front -hile most banks managed to f lfill the norms, it -as a feat achieved -ith its o-n share of diffic lties. :he ?.;, -hich at !resent is '.0 !ercent, is likely to be hiked to &+.0 !ercent by the year +004 based on the Basle ?ommittee recommendations. .ny bank that -ishes to gro- its assets needs to also shore ! its ca!ital at the same time so that its ca!ital as a !ercentage of the risk--eighted assets is maintained at the sti! lated rate. 5hile the I0, ro te -as a m ch-fancied one in the early I'0s, the c rrent scenario doesnEt look too attractive for bank ma/ors.

?onse3 ently, banks have been forced to e"!lore other aven es to shore ! their ca!ital base. 5hile some are -ooing foreign !artners to add to the ca!ital others are em!loying the 7F . ro te. 7any are also going in for right iss es at !rices considerably lo-er than the market !rices to -oo the investors.
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Interest Rate Scene :he t-o years, !ost the 8ast .sian crises in &''>-'B sa- a climb in the global interest rates. It -as only in the later half of FH0& that the 4) Fed c t interest rates. India has ho-ever

remained more or less ins lated. :he !ast + years in o r co ntry -as characteri<ed by a mo nting intention of the ;eserve Bank ,f India #;BI$ to steadily red ce interest rates res lting in a narro-ing differential bet-een global and domestic rates.

:he ;BI has been affecting bank rate and ?;; c ts at reg lar intervals to im!rove li3 idity and red ce rates. :he only e"ce!tion -as in % ly +000 -hen the ;BI increased the ?ash ;eserve ;atio #?;;$ to stem the fall in the r !ee against the dollar. :he steady fall in the interest rates res lted in s3 ee<ed margins for the

banks in general.

Governmental Policy: .fter the first !hase and second !hase of financial reforms, in the &'B0s commercial banks began to f nction in a highly reg lated environment, -ith administered interest rate str ct re, 3 antitative restrictions on credit flo-s, high reserve re3 irements and reservation of a significant !ro!ortion of lendable reso rces for the !riority and the government sectors. :he restrictive reg latory norms led to the credit rationing for the !rivate sector and the interest rate controls led to the n!rod ctive se of credit and lo- levels of investment and gro-th. :he res ltant Ifinancial re!ressionE led to decline in !rod ctivity and efficiency and erosion of !rofitability of the banking sector in general. :his -as -hen the need to develo! a so nd commercial banking system -as felt. :his -as -orked o t mainly -ith the hel! of the recommendations of the ?ommittee on the Financial
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)ystem #?hairman2 )hri 7. Carasimham$, &''&. :he res ltant financial sector reforms called for interest rate fle"ibility for banks, red ction in reserve re3 irements, and a n mber of str ct ral meas res. Interest rates have th s been steadily dereg lated in the !ast fe- years -ith banks being free to fi" their 0rime Lending ;ates#0L;s$ and de!osit rates for most banking !rod cts. ?redit market reforms incl ded introd ction of ne- instr ments of credit, changes in the credit delivery system and integration of f nctional roles of diverse !layers, s ch as, banks, financial instit tions and non-banking financial com!anies #Cbfcs$. Domestic 0rivate )ector Banks -ere allo-ed to be set !, 0)Bs -ere allo-ed to access the markets to shore ! their ?ars. Implications Of Some Recent Policy easures:

:he allo-ing of 0)Bs to shed man!o-er and dil tion of e3 ity are moves that -ill lend greater a tonomy to the ind stry. In order to lend more de!th to the ca!ital markets the ;BI had in Covember +000 also changed the ca!ital market e"!os re norms from 1 !ercent of bankEs incremental de!osits of the !revio s year to 1 !ercent of the bankEs total domestic credit in the !revio s year. B t this move did not have the desired effect, as in, -hile most banks ke!t a-ay almost com!letely from the ca!ital markets, a fe- !rivate sector banks -ent overboard and e"ceeded
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limits and ind lged in d bio s stock market deals. :he chances of seeing banks making a comeback to the stock markets are therefore 3 ite nlikely in the near f t re.

:he move to increase Foreign Direct Investment FDI limits to 4' !ercent from +0 !ercent

d ring the first 3 arter of this fiscal came as a -elcome anno ncement to foreign !layers -anting to get a foot hold in the Indian 7arkets by investing in -illing Indian !artners -ho are starved of net -orth to meet ?.; norms. ?eiling for FII investment in com!anies -as also increased from +4.0 !ercent to 4'.0 !ercent and have been incl ded -ithin the ambit of FDI investment. IDBI bank: all about :he economic develo!ment of any co ntry de!ends on the e"tent to -hich its financial system efficiently and effectively mobili<es and allocates reso rces. :here are a n mber of banks and financial instit tions that !erform this f nctionJ one of them is the develo!ment bank. Develo!ment banks are ni3 e financial instit tions that !erform the s!ecial task of fostering the develo!ment of a nation, generally not ndertaken by other banks.
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Develo!ment banks are financial agencies that !rovide medi m-and long-term financial assistance and act as catalytic agents in !romoting balanced develo!ment of the co ntry. :hey are engaged in !romotion and develo!ment of ind stry, agric lt re, and other key sectors. :hey also !rovide develo!ment services that can aid in the accelerated gro-th of an economy. :he ob/ectives of develo!ment banks are2 :o serve as an agent of develo!ment in vario s sectors, vi<. ind stry, agric lt re, and international trade !o accelerate the gro"th of the economy !o allocate resources to high priority areas !o foster rapid industriali#ation$ particularly in the private sector$ so as to provide employment opportunities as "ell as higher production !o develop entrepreneurial skills

!o promote the development of rural areas !o finance housing$ small scale industries$ infrastructure$ and social utilities% In addition, they are assigned a s!ecial role in2
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0lanning, !romoting, and develo!ing ind stries to fill the ga!s in ind strial sector. ?oordinating the -orking of instit tions engaged in financing, !romoting or develo!ing ind stries, agric lt re, or trade, rendering !romotional services s ch as discovering !ro/ect ideas, ndertaking feasibility st dies, and !roviding technical, financial, and managerial assistance for the im!lementation of !ro/ects

Industrial development &ank of India :he ind strial develo!ment bank of India#IDBI$ -as established in &'(4 by !arliament as -holly o-ned s bsidiary of reserve bank of India. In &'>(, the bankEs o-nershi! -as transferred to the government of India. It -as accorded the stat s of !rinci!al financial instit tion for coordinating the -orking of instit tions at national and state levels engaged in financing, !romoting, and develo!ing ind stries. IDBI has !rovided assistance to develo!ment related !ro/ects and contrib ted to b ilding ! s bstantial ca!acities in all ma/or ind stries in India. IDBI has directly or indirectly assisted all com!anies that are !resently reckoned as ma/or cor!orates in the co ntry. It has !layed a dominant role in balanced ind strial develo!ment.

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IDBI set ! the small ind stries develo!ment bank of India #)IDBI$ as -holly o-ned s bsidiary to cater to s!ecific the needs of the small-scale sector.

IDBI has engineered the develo!ment of ca!ital market thro gh hel!ing in setting ! of the sec rities e"change board of India#)8BI$, Cational stock e"change of India limited#C)8$, credit analysis and research limited#?.;8$, stock holding cor!oration of India limited#)9?IL$, investor services of India limited#I)IL$, national sec rities de!ository limited#C)DL$, and clearing cor!oration of India limited#??IL$ In &''+, IDBI accessed the domestic retail debt market for the first time by iss ing innovative bonds kno-n as the dee! disco nt bonds. :hese ne- bonds became highly !o! lar -ith the Indian investor. In &''4, IDBI .ct -as amended to !ermit ! blic o-nershi! ! to 4' !er cent. In % ly &''1, it raised over ;s +0 billion in its first initial ! blic #I0,$ of e3 ity, thereby red cing the government stake to >+.&4 !er cent. In % ne +000, a !art of government shareholding -as converted to !reference ca!ital. :his ca!ital -as redeemed in 7arch +00&, -hich led to a red ction in government stake. :he government stake c rrently is 1& !er cent.

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In a g st +000, IDBI became the first all India financial instit tion to obtain I), '00+2 &''4 certification for its treas ry o!erations. It also became the first organi<ation in the Indian financial sector to obtain I), '00&2+000 certification for its fore" services.

ilestones

'uly ()*+: )et ! nder an .ct of 0arliament as a -holly-o-ned s bsidiary of ;eserve Bank of India.

,e&ruary ()-*: ,-nershi! transferred to 6overnment of India. Designated 0rinci!al Financial Instit tion for co-coordinating the -orking of instit tions at national and )tate levels engaged in financing, !romoting and develo!ing ind stry.

arch ()./: International Finance Division of IDBI transferred to 8"!ortIm!ort Bank of India, established as a -holly-o-ned cor!oration of 6overnment of India, nder an .ct of 0arliament.

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April ())0: )et ! )mall Ind stries Develo!ment Bank of India #)IDBI$ nder )IDBI .ct as a -holly-o-ned s bsidiary to cater to s!ecific needs of small-scale sector. In terms of an amendment to )IDBI .ct in )e!tember +000, IDBI divested 1&K of its shareholding in )IDBI in favo r of banks and other instit tions in the first !hase. IDBI has s bse3 ently divested >'.&*K of its stake in its erst-hile s bsidiary to date.

'anuary ())/: .ccessed domestic retail debt market for the first time -ith innovative Dee! Disco nt BondsJ registered !ath-breaking s ccess.

1ecem&er ())2: )et ! IDBI ?a!ital 7arket )ervices Ltd. as a -hollyo-ned s bsidiary to offer a broad range of financial services, incl ding Bond :rading, 83 ity Broking, ?lient .sset 7anagement and De!ository )ervices. IDBI ?a!ital is c rrently a leading 0rimary Dealer in the co ntry.

Septem&er ())+: )et ! IDBI Bank Ltd. in association -ith )IDBI as a !rivate sector commercial bank s bsidiary, a se3 el to ;BI's !olicy of o!ening ! domestic banking sector to !rivate !artici!ation as !art of overall financial sector reforms.

Octo&er ())+: IDBI .ct amended to !ermit ! blic o-nershi! !to 4'K.

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'uly ())3: 7ade Initial 0 blic ,ffer of 83 ity and raised over ;s.+000 crore, thereby red cing 6overnment stake to >+.&4K.

arch /000:8ntered into a %D agreement -ith 0rinci!al Financial 6ro !, 4). for !artici!ation in e3 ity and management of IDBI Investment 7anagement ?om!any Ltd., erst-hile a &00K s bsidiary. IDBI divested its entire shareholding in its asset management vent re in 7arch +00* as !art of overall cor!orate strategy.

arch /000: )et ! IDBI Intech Ltd. as a -holly-o-ned s bsidiary to ndertake I:-related activities.

'une /000: . !art of 6overnment shareholding converted to !reference ca!ital, since redeemed in 7arch +00&J 6overnment stake c rrently 1B.4>K.

August /000: Became the first .ll-India Financial Instit tion to obtain I), '00+2&''4 ?ertification for its treas ry o!erations. .lso became the first organisation in Indian financial sector to obtain I), '00&2+000 ?ertification for its fore" services.

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arch /00(: )et ! IDBI :r steeshi! )ervices Ltd. to !rovide technologydriven information and !rofessional services to s bscribers and iss ers of debent res.

,e&urary /00/: .ssociated -ith select banks=instit tions in setting ! .sset ;econstr ction ?om!any #India$ Limited #.;?IL$, -hich -ill be involved -ith the

)trategic management of non-!erforming and stressed assets of Financial Instit tions and Banks.

Septem&er /002: IDBI ac3 ired the entire shareholding of :ata Finance Limited in :ata 9omefinance Ltd, signalling IDBI's foray into the retail finance sector. :he ho sing finance s bsidiary has since been renamed 'IDBI 9omefinance Limited'.

1ecem&er /002: ,n December &(, +00*, the 0arliament a!!roved :he Ind strial Develo!ment Bank #:ransfer of 4ndertaking and ;e!eal Bill$ +00+ to re!eal IDBI .ct &'(4. :he 0resident's assent for the same -as obtained on December *0, +00*. :he ;e!eal .ct is aimed at bringing IDBI nder the ?om!anies .ct for investing it -ith the re3 isite o!erational fle"ibility to ndertake commercial banking b siness nder the Banking
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;eg lation .ct &'4' in addition to the b siness carried on and transacted by it nder the IDBI .ct, &'(4.

'uly /00+: :he Ind strial Develo!ment Bank #:ransfer of 4ndertaking and ;e!eal$ .ct +00* came into force from % ly +, +004.

'uly /00+: :he Boards of IDBI and IDBI Bank Ltd. take in-!rinci!le decision regarding merger of IDBI Bank Ltd. -ith !ro!osed Ind strial Develo!ment Bank of India Ltd. in their res!ective meetings on % ly +', +004.

Septem&er /00+: :he :r st Deed for )tressed .ssets )tabilisation F nd #).)F$ e"ec ted by its :r stees on )e!tember +4, +004 and the first meeting of the :r stees -as held on )e!tember +>, +004.

Septem&er /00+: :he ne- entity LInd strial Develo!ment Bank of IndiaL -as incor!orated on )e!tember +>, +004 and ?ertificate of commencement of b siness -as iss ed by the ;egistrar of ?om!anies on )e!tember +B, +004.

Septem&er /00+:Cotification iss ed by 7inistry of Finance s!ecifying ).)F as a financial instit tion nder )ection +#h$#ii$ of ;ecovery of Debts d e to Banks F Financial Instit tions .ct, &''*.
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Septem&er /00+:Cotification iss ed by 7inistry of Finance on )e!tember +', +004 for iss e of non-interest bearing 6oI IDBI )!ecial )ec rity, +0+4, aggregating ;s.'000 crore, of +0-year ten re.

Septem&er /00+: Cotification for a!!ointed day as ,ctober &, +004, iss ed by 7inistry of Finance on )e!tember +', +004.

Septem&er /00+:;BI iss es notification for incl sion of Ind strial Develo!ment Bank of India Ltd. in )ched le II of ;BI .ct, &'*4 on )e!tember *0, +004.

Octo&er /00+: .!!ointed day - ,ctober 0&, +004 - :ransfer of ndertaking of IDBI to IDBI Ltd. IDBI Ltd. commences o!erations as a banking com!any. IDBI .ct, &'(4 stands re!ealed. 'anuary /003::he Board of Directors of IDBI Ltd., at its meeting held on %an ary +0, +001, a!!roved the )cheme of .malgamation, envisaging merging of IDBI Bank Ltd. -ith IDBI Ltd. 0 rs ant to the scheme a!!roved by the Boards of both the banks, IDBI Ltd. -ill iss e &00 e3 ity shares for &4+ e3 ity shares held by shareholders in IDBI Bank Ltd. 867 has been convened on Febr ary +*, +001 for seeking shareholder a!!roval for the scheme.

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IDBI Bank Business Chart

IDBI BANK

RETAIL BANKING

DEVELOPMENT BANK.

SAVING ACCOUNT

CURRENT ACCOUNT

INVESTMENT

PERSONAL SAVING

CORPORATE SAVING

IDBI Bank Organizational Chart

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Ch !"# $

P"%&!'%$(

V!)% *"%&!'%$( +!$ $)%

V!)% *"%&!'%$( /. R.

V!)% *"%&!'%$( M ",%(!$-

V!)% *"%&!'%$( O*%" (!.$&

R%-!.$ 1 /% '

2.$ 1 /% '

D!0!&!.$ 1 S 1%& M $ -%"

T%""!(."3 I$ )h "-%

S4O! A5A67SIS
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Strength :he keys strength areas of IDBI Bank are their motivated and highly com!etent staff -ho is aggressive in their ! rs it for e"cellence in terms of em!loyee com!etence it rivals the highly rated foreign banks. 4eakness :ho gh IDBI Bank has -ide coverage of .:7 Cet-ork thro gho t the co ntry it is not considered ade3 ate kee!ing in vie- is -ide c stomer base. Opportunity IDBI Bank has good o!!ort nity in ; ral area and offices etc. -hich are still nto ched by banks of s ch re! te an are considered virgin markets. !hreat ,ther banks like I?I?I, ?ent rion, 4:I, 9DF?, an e"!anding at a very fast rate and are !erceived as threat to IDBI Bank.

Revie" Of 6iterature In dec +00+ elissa B% 'aco&y had st died abo t the IDBI bank !erformance Beyond a ) b!rime ?risis2 :he ;ole of Delin3 ency 7anagement. :hey st died
24

that 0 blic investment in and !romotion of homeo-nershi! and the mortgage market often relies on three / stifications to s !!lement shelter goals2 to b ild -ealth and economic self-s fficiency, to generate !ositive social-!sychological states, and to develo! stable neighborhoods and comm nities. o-nershi! and mortgage obligations do not inherently f rther these ob/ectives, ho-ever, and sometimes ndermine them. :he most visible triggers of the recent s rge in s b!rime delin3 ency have !rod ced calls for emergency foreclos re avoidance interventions #as -ell as front-end reg latory fi"es$. 5hatever their merit, I contend that a system of mortgage delin3 ency management sho ld be an end ring com!onent of ho sing !olicy. F rtherance of ho sing and ho sehold !olicy ob/ectives hinges in !art on the conditions nder -hich homeo-nershi! is obtained, maintained, leveraged, and - in some sit ations - e"ited. 6iven that high leverage or trigger events s ch as /ob loss and medical !roblems !lay significant roles in mortgage delin3 ency inde!endent of loan terms, better origination !ractices cannot eliminate the need for delin3 ency management. ,ne f nction of this brief essay is to identify an e"isting ro gh frame-ork for managing delin3 ency. Legal scholarshi! sho ld no longer disc ss mortgage enforcement !rimarily in terms of foreclos re la- and instead sho ld incl de other debtor-creditor la-s s ch as bankr !tcy, ind stry loss mitigation efforts, and third-!arty interventions s ch as delin3 ency ho sing co nseling. In terms of analy<ing this frame-ork, it is tem!ting to foc s on its im!act on mortgage credit cost and access or on the absol te n mber of homes tem!orarily saved, b t my !ro!osed analysis is based on -hether the system honors and f rthers the goals of -ealth b ilding, !ositive social !sychological states, and comm nity develo!ment. Beca se those ends are not ine"orably linked to o-nershi! generally or o-ning a !artic lar home, a system of delin3 ency management that honors these ob/ectives sho ld strive to !rovide fair, trans!arent, h mane, and !redictable strategies for home e"it as -ell as for home retention. .ltho gh more em!irical research is needed, this essay starts the !rocess of analy<ing mortgage delin3 ency management tools in the !ro!osed fashion.

O&8ective

25

- :o kno- abo t environmental factors affecting IDBI BankEs !erformance. - :o analy<e the role of advertisement for bank !erformance. - :o kno- the !erce!tion and conce!tion of c stomers to-ards banking !rod cts and s!ecially foc sed for IDBI BankEs !rod ct. - :o e"!lore the !otential areas for the ne- bank branches -hich -ill !rovide both !rice and !eo!le to the bank -ith constant !romotion and !lacing strategy.

SCOP9 O, S!:17 )co!e of the )t dy

26

- ;esearch st dy co ld give an idea of net-ork e"!ansion for ca!t ring more market and c stomer -ith better services and lo-er cost, -ith o t com!romising -ith 3 ality. - In f t re c stomer re3 irements co ld be added -ith the !rod ct and services for getting an edge over com!etitors. - ?ons mer behavior co ld also be sed for the ! r!ose of la nching a ne!rod ct -ith e"tra benefits -hich are re3 ired by c stomers for their acco nt #saving or c rrent $ and=or for their investments. - Factors -hich are res!onsible for the !erformance for bank can also be sed for the modification of the strategy and !rod ct for being more !rofitable. - Factors -hich I observed -hile doing !ro/ect st dy are follo-ing?om!etitors ? stomer Behavior .dvertisement=!romotional activities .ttit de of man!o-er and 8conomic conditions

Sources of Primary and Secondary data: For the ! r!ose of !ro/ect data is very m ch re3 ired -hich -orks as a food for !rocess -hich -ill ltimately give o t! t in the form of information. )o before
27

mentioning the so rce of data for the !ro/ect I -o ld like to mention that -hat ty!e of data I have collected for the ! r!ose of !ro/ect and -hat it is e"actly. (% Primary 1ata: 0rimary data is basically the live data -hich I collected on field -hile doing cold calls -ith the c stomers and I sho-n them list of 3 estion for -hich I had re3 ired their res!onses. In some cases I got no res!onse form their side and than on the basis of my !revio s e"!eriences I filled those fields. Source: 7ain so rce for the !rimary data for the !ro/ect -as 3 estionnaires -hich I got filled by the c stomers or sometimes filled myself on the basis of disc ssion -ith the c stomers. /% Secondary 1ata: )econdary data for the base of the !ro/ect I collected from intranet of the Bank and from internet, ;BI B lletin, %o rnal by I?F.I 4niversity. Statistical Analysis In this segment I -ill sho- my findings in the form of gra!hs and charts. .ll the data -hich I got form the market -ill not be disclosed over here b t e"tract of that in the form of information -ill definitely be here. Si#e of 1ata !ype of 1ata : /30 Area : 1elhi /% Secondary

: (% Primary

6I I!A!IO5S O, !;9 S!:17:

D ring the !ro/ect follo-ing limitations -here kno-n2

28

 :he area -as large and it -as not !ossible to deal -ith each and every c stomers. :ime -as the ma/or constraint as I have only t-o months and the area is very vast .8ven tho gh I have ! t ! the best of my efforts to cover all the areas given to me. 7any of the c stomers -here not coo!erative -hen they are asked give femin tes. .s IDBI Bank is a big brand, many times the ans-ers of the res!ondent may be affected by his good or bad e"!erience abo t some other !rod ct. :o convince the !eo!le for a !ro!er intervie-ing !rocess is also diffic lt. ?om!ilation of data on com!etitor analysis -as diffic lt d e to nonavailability of correct information.

<(: Correlation &et"een a"areness of customers a&out I1BI &ank = their Age

29

AG9 5O% O, R9SPO5S9

+0-+1 +1

+1-*0 4(

*0-*1 *4

*1-40 +*

40-41 +&

4110 ++

10(0 +4

(0.B,D8 11

60

Interpretation
Bet-een the age gro ! of +1-*0 .they kno- more abo t the IDBI Bank F the age limit of (0 they also kno- more abo t the bank.

< /: P9RC9P!IO5 O, I1BI AS A BA5>

30

20 -2 5 25 -3 0 30 -3 5 35 -4 0 40 -4 5 45 -5 0 5 60 0-6 -A 0 BO VE

RESPONSES

50 40 30 20 10 0 NO. OF RESPONSE

AGE GROUP

!7P9 O, BA5> R9SPO5S9S

0;ID.:8 10

04BLI? 41

0;ID.:8=04BLI? &00

D,C': MC,5 11

RESPONSES

DON'T KNOW

PRIVATE PUBLIC

PRIVATE PUBLIC PRIVATE/PUBLIC DON'T KNOW

PRIVATE/PUB LIC

Interpretation 0eo!le say that the IDBI Bank are !rivate and ! blic bank and the 11K of the !eo!le donEt kno- the IDBI bank.

< 2 : RA!I5G O, C:S!O 9RS ,OR I1BI BA5> AS A GOO1 BA5>

PARA 9!9R EFFICIENCY INTERNET BANKING/ATMs PRODUCT RANGE NETWORK PHONE BANKING R9SPO5S9S >1K +1K '1K **K ++K 31

33

22 75

EFFICIENC" INTERNET BANKIN#/AT$% PRODUCT RAN#E NETWORK

!5 25

P&ONE BANKIN#

Interpretation '1K !eo!le think that the !rod ct range of the IDBI Bank are almost good.and >1K !eo!le seems that the efficiency of bank is good and rest of c stomer says the internet banking is also good. <+: AR>9! S;AR9S I5 196;I I5 CO PARISIO5 !O

CO P9!I!ORS
BA5> 5A 9 SBI IDBI ICICI ? O, S;AR9 *0K &1K +1K 32

PNB HDFC HSBC OTHERS

&0K 1K 1K &0K

SBI 30 ICICI 25 20 IDBI 15 PNB 10 &DFC&SBC 5 0 OT&ERS SBI IDBI ICICI PNB &DFC &SBC OT&ERS

OF S&ARE

Interpretation :he most of the share in Delhi are of )BI after that I?I?I and then IDBI Bank. ;est of 1K and &0K share of 9DF? and 9)B? Bank. <3: ,AC!ORS R9SPO5SIB69 ,OR P9R,OR A5C9 O, I1BI BA5> I5 196;I

PARA ? S;AR9

PRODUCT 10K

AD 1K

MANPOWER +1K

NETBANKING +K

PHONE BANKING 1K

INVESTMENT SCHEME &0K

NET *K 33

60 PERSENTAGE 50 40 30 20 10 0 OF S&ARE PARAMETERS 10 5 2 5 3 25 50 PRODUCT ADVERTIS$ENT $ANPOWER NET-BANKIN# P&ONE BANKIN# INVEST$ENT SC&E$E NETWORK

Interpretation 0rod ct of IDBI Bank are region able thatEs -hy 10K of the !eo!le think that !rod ct are too m ch good,1K think that advertisement is effective.+1K !eo!le think that the man!o-er is totally hel!f l.

<* : CO PARA!I@9 S!:17 4I!; BASIC PARA 9!9RS

PARA 9!9R SABA5>S PRO DUC T +0K &1K *0K ADVERTI SMENT MANP OWER

A'OR CO P9!I!ORS O5

NETBAN KING *K 10K &0K

PHO NE BAN KING &0K 40K 1K

INVEST MENT SCHEM E 1K +1K 10K

NETW ORK

CREDI BILITY

I1BI ICICI SBI

*K 41K &1K

&0K 10K +K

+K 40K 40K

+0K &0K 40K 34

P5B ;SBC CA5ARA BA5>

&1K &0K &0K

+0K >K &0K

*K +1K &0K

&+K BK &>K

1K *0K &0K

&0K 1K 1K

1K *K &0K

+0K 1K 1K

COMPARATIVE GRAPHS
60 50 40 30 20 10 0
ID BI CI SB I CA &S NA BC RA BA NK PN B IC I

PERCENTAGE

PRODUCT ADVERTIS$ENT $ANPOWER NET-BANKIN# P&ONE BANKIN# INVEST$ENT SC&E$E NETWORK CREDIBILIT"

BANKS

Interpretation: :here are com!arison -ith other commercial bank, there are close

com!ition -ith the I?I?I bank and the )BI bank they both are large enter!rises and there no of c stomer are totally high if com!are -ith other commercial bank.
< -: !;9 9,,9C!I@959SS O, CO 9RCIA6S O, I1BI BA5>

1A7S A,!9R !;9 A1 IS S995 0-5 days -!0 days !!-!5 days "#$% &'a( !5 days

POSI!I@9 R9SPO5S9 &00 (> 4* 40

35

POSITIVE RESPONSE NO. OF PEOPLE REMEMBERED THE AD 120 100 '0 60 40 20 0 0-5 ()*% 6-10 ()*% 11-15 ()*% +,-. /0)1 15 ()*% POSITIVE RESPONSE

NO. OF DAYS AFTER AD

Interpretation :he !eo!le are a-are abo t the advertisement of IDBI Bank and their res!onses are also !ositive and in favo rable.-ith in 1 days the res!onses are of &00K !eo!le are a-are abo t the com!any and their !olicies.

,indings

36

&. :he credibility of IDBI bank is good in com!arison to its com!etitors 6,I #6overnment ,f India$ is a ma/or share holder in the com!any.

as

+. IDBI bank has !otential a ta!!ed market in ).M8: in region and hence has an o!!ort nities for gro-th.

*. :he !rod cts of IDBI bank has good credibility in the region com!are to its com!etitors.

4. :he advertisement of the bank -as very effective from the first day of its airing till the fifth day and there after it starts declining.

1. :he initial balance for .=? o!ening is ;s, 1000=- and thatEs -hy !eo!le are rel ctant in o!ening the same.

Recommendations

37

&. )ince there is only t-o branch of IDBI bank and only three atms in Delhi, so it is necessary for IDBI bank to o!en more branches and install more atms to serve the vast market of Delhi es!ecially. +. 7ore reso rces sho ld be allocated in the market of Delhi as there is big nta!!ed market in Delhi, so it becomes necessary for IDBI bank for taking an edge over the com!etitors. *. . short advertising cam!aign in Delhi has !rod ced good res lts in a short s!an of times, so to gain long term benefits is very necessary for IDBI bank to carry on this cam!aign -ith more intensity. 4. Besides o!ening more branches it sho ld also look for o!ening some e"tension co nter in M t b near mehera li and one in Mhan! r. 1. .s 6overnment is the ma/ority share holder in the shares of IDBI bank, -hich makes this bank more reliable than other !rivate banks, this thing can be sed in the favo r of IDBI bank by making !eo!le a-are abo t this fact and -inning their faith.

Conclusions
38

&. ?ons mers of Delhi have good a-areness level abo t IDBI bank as -ell as abo t its services and !rod cts. +. :he advertising cam!aign has s ccessf lly been able to increase the market share of IDBI in Delhi. *. :he modern days technology like internet banking, !hone banking, sed by IDBI bank for !roviding banking services has sent !ositive signals in the mind of cons mes. 4. :he net-ork of IDBI in Delhi is lagging behind a little than its com!etitors like I?I?I bank and 9DF? bank. 1. It can be distilled from data that IDBI bank has good market share as com!ared to its com!etitors considering the amo nt of reso rces de!loyed by them in the market.

39

40

41