GLOBAL

EXPANSIO
N

CASE PRESENTATION GROUP1

SACHIN , TUSHAR, VINEET

INTRODUCTION

Formed in 1955

Model of working -: Raising money by bonds and

financing projects by it

Started Changing the model in mid 1980s

Moved in to Retail deposits ,venture capital and

asset management .

Change of CEO in 1996 KV Kamath

Moved to retail banking space in 1999

Introduced voluntary retirement and feedback

system to increase the efficiency of the Bank

Moved for International banking in 2002.

RETAIL SECTOR

Tapped the Huge market potential

Mortgage volumes in India 1% of GDP compared to 30-40 % in

other Southeast Asian Countries

Auto finance merely 0.3 % of GDP

Raised capital for Retail endeavor by listing on New York Stock

Exchange.

Hired not heads of Competitors but who were ambitious

hungry and talented .

Initially entered into Housing ,Auto finance ,then went into

Credit Cards ,Consumer finance and insurance .

Ventured into Internet banking and installed a huge no of ATM

Retail Landing increased at 25 % a year and grew 300% in

fiscal year 2001 that is 600 million

Competition at Later stage

Led to Lowering of Spreads form 9% to 3%

KEY REASONS FOR

GOING GLOBAL

To continue the growth as severe competition

from local market in both retail and commercial
sector leading to lowering of spread

Diversify risk across geographies

Enhance profitability by offering comprehensive

and product suite and exploring new markets

Maximize opportunities that arise through

international operations

Enhance size and scale of operations

INTERNTIONAL OPORTUNITY

NRI opportunity

Seeking ethnic familiarity and Indian linkage but with

internationally benchmarked product and services.

US $ 15 billion remittances to India ,money transfer

companies charging too high (5-10 %)

Following the Customer

As Indian companies are going global

Leveraging the Indian base

International network served by Low cost India based

infrastructure (Back Office)

Indian banks ideally placed to leverage Indian

platform for Global Competitiveness.

COMPETITORS

Foreign Banks such ( CITI ,HSBC)

Competition

Both catered in Retail and Commercial Banking

CITI providing NRI services for 15 years

CITI approach changing from High-net-worth Client to Mass

market

Scope

Smaller Branch network and lower penetration in domestic

market

Still Attitude towards high-net worth clients I

Public Sector banks (SBI ,State bank of Baroda etc)

Competition

Vast branch network and established relationship with Indian

Community Abroad

Out of 70 % SBI had 40 % of Remittance business

Collaborated with Independent Exchange Houses.

Scope

Credit decisions very slow due to lack of technology and

decisions taken in Indian Head quarters

Bad Credit decisions leading to Bad NPAs

No aggressive Marketing

No product Innovation

Indian staff with no idea of Local Environment

Due to this Banks had been scaling down

Money transfer companies ( Western Union)

Competition

Western Union had 101000 agents in 186 countries

In 2000 it signed a Multi year aggrement with

Department of Posts to increase its availability in
India

Scope

High processing fees (5 to 10 %)

Discussion Topics

What geographic footprint should ICICI target.

On which products and customer segments

should it focus.

Should It partner with Local banks or Go alone

Should it enter market at a time or across many

simultaneously .

Thank you