ANALYSIS OF HDFC BANK

SUBMITTED BY:
ARUSH JAIN
HARDIK JOSHI
VANDANA KABRA
MONIKA KAR
SUMEET KASLIWAL
KHUSHBOO RAGHAVAN
DURATION GAP ANALYSIS
 COUPON YEARS OF YIELD TO MARKET
AMOUNT RATE MATURITY MATURITY VALUE

ASSET

Loans &
advances 5527511 15.25% 3 15.25% 55,275,11
Loans &
advances 937291 15.25% 5 15.25% 9,372,91

TOTAL   6464802        

LIABILITIES

Deposits 8307549 6.25% 3 11.25% 83,075,49

Deposits 1812739 7.50% 5 11.25% 18,127,39

TOTAL 10120288        
 LOAN & ADVANCES
 
Coupon Cash PV Discounted No. of DCF * No. of Duration on
Rate  Flows FACTOR Cash Flows years years assets

3 YRS
5527511 15.25% 842945.43 0.909 766237.3936 1 766237.3936    

    842945.00 0.826 696272.57 2 1392545.14    

    6370456.43 0.751 4784212.777 3 14352638.33    

        6246722.741   16511420.86 2.64  

5 YRS                

937291 15.25% 142936.88 0.909 129929.62 1 129929.62    

    142936.88 0.826 118065.86 2 236131.72    

    142936.88 0.751 107345.60 3 322036.79    

    142936.88 0.683 97625.89 4 390503.55    

    1080227.88 0.620 669741.28 5 3348706.42    

        1122708.25   4427308.10 3.94 2.83

 DEPOSITS
 
Coupon Cash PV Discounted No. of DCF * No. of Duration on
Rate  Flows FACTOR Cash Flows years years liabilities

3 YRS

8307549 6.25% 519221.81 0.909 471972.63 1 471972.63    

    934599.26 0.826 771978.99 2 1543957.98    

    8826770.81 0.751 6628904.88 3 19886714.64    

        7872856.50   21902645.25 2.78  

5 YRS                

1812739 7.50% 135955.43 0.909 123583.48 1 123583.48    

    203933.14 0.826 168448.77 2 336897.54    

    203933.14 0.751 153153.79 3 459461.36    

    203933.14 0.683 139286.33 4 557145.33    

    1948694.43 0.620 1208190.54 5 6040952.72    

        1792662.92   7518040.43 4.19 3.03

TOTAL DURATION GAP = 0.74

DURATION OF ASSETS > DURATION OF

LIABILITIES
ALTMAN “Z” SCORE
 (X) weight Weighted
Ratio Formula Cal factor ratio

Return on total
assets EBIT/TA 0.054 3.3 0.179
Sales to total
assets Net sales/TA 0.090 0.999 0.090

(capital+reserves)/
Equity to debt debt 0.980 0.6 0.588

Working capital
to total assets WC/TA 0.069 1.2 0.082

Retained
earnings to total
assets RE/TA 0.020 1.4 0.029

Z Score 0.968
 KEY ELEMENTS
Our Z-Score is: 0.9678

Z-SCORE ABOVE 2.99-- IN GOOD SHAPE

Z-SCORE BETWEEN 2.99 and 1.81--WARNING

SIGNS

Z-SCORE BELOW 1.81--BIG TROUBLE--COULD BE

HEADING TOWARD BANKRUPTCY
IMPACT OF MONETARY
POLICY ON HDFC BANK
3 FOLD IMPACT OF MONETARY POLICY
 Part one contains monetary measures like bank rate, repo rate,
reverse repo rate, SLR and CRR.
 HDFC reduced its PLR by 25 basis points to 15.75 per cent,
turning the loans cheaper for customers. HDFC has reduced
benchmark lending rate by 75 basis points during last six
months. The latest move came amid reduced fund costs in recent
times, due to low demand across all sectors of the economy and
not in reciprocation of the credit policy declared by RBI.
 Second part contains a credit policy measure which advises the
bank to meet segmental targets like advances to Priority sector
(40%), to agriculture segment (18%).
 HDFC doesn’t meet RBI’s norms for priority sector lending
requirement as it lends to only 35% borrowers against prescribed
40%.
3 FOLD IMPACT OF MONETARY POLICY

 Third part of the policy prescribes operational guidelines

like banks will have to comply with KYC norms also
banks are required to open no deposit account for
financial inclusion.

 HDFC provides ‘No Frills’ savings accounts through all its branches
as a stepping stone towards financial inclusion. These accounts are
offered only to customers who do not have any other bank account
(are un-banked) and who are either beneficiaries of a government
welfare scheme or have annual incomes less than a defined
threshold (constitute the bottom of the economic pyramid).
THANK
YOU