A PROJECT ON ANALYSIS OF BANKING SECTOR

SUBMITTED BY: KETAN JAIN RIZVI INSTITUTE OF MANAGEMENT STUDIES AND RESEARCH SUBMITTED TO: Mr. KALPESH DODIA

CERTIFICTE OF APPROVAL The following Summer Project Report Title Sector Analysis is hereby approved as certificate studies in management carried out in a manner satisfactory to warrant its acceptance as a prerequisite for the award of PGDBM for which they have been submitted. It is understood that by this approval the undersigned do not necessarily endorse or approve any statement made, opinion expressed or conclusion drawn therein but approve the summer Project only for the purpose it is submitted. Summer Project Report Examination Committee for evaluation of Summer Project Report.

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CERTIFICATE FROM SUMMER PROJECT GUIDE.

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ACKNOWLEDGEMENT It gives me immense pleasure, having done a project on an interesting and knowledgeable topic like Sector Analysis. This project has not only widened my horizon as far as academics are concerned but also helped me to enlarge my knowledge bank. Marketing Management and Human resources are not topics, which could be handled with certain amount of casualty. It requires a deep study and hard work, which is a key to success. There are many people associated with this project without which this project would not have been possible. I thank my Institute who has given me an opportunity to show my skills. I also thank all my nearer and dearer ones without whose support this project would not been possible. I would like to thank ______________, who allowed me to do this project in Max New York Life successfully.

Table of contents

1 Industrial Profile of Life Insurance Sector 2 History of Life Insurance Sector 3 Company Profile of Max New York Life Insurance 4 Global Banking Industry 5 Indian Banking Rates 6 Analysis of Banks (ICICI, Union and Sbi) 7 Comparison, Conclusion & Recommendation

01 03 11 24 26 28 47

2.0 Insurance Company 2.1 Introduction:Life is a roller coaster ride and is full of twists and turns. You cannot take anything for granted in life. Insurance policies are a safeguard against the uncertainties of life. Insurance is system by which the losses suffered by a few are spread over many, exposed to similar risks. Insurance is a protection against financial loss arising on the happening of an unexpected event. Insurance policy helps in not only mitigating risks but also provides a financial cushion against adverse financial burdens suffered. Insurance is a contract between two parties, the insurer or the insurance company, and the insured, the person seeking the cover. Within this contract, the insurer agrees to pay the insurer for financial losses arising out of any unforeseen events or risk in return for a regular payment of premium. Thus, these insurance plans are also called as a Risk Cover Plans, which means to financially compensate for losses that occur uncertainly through accident, illness, theft, natural disaster. As you cannot fight against these man-made and natural calamities, so at least be prepared for them and their aftermath by taking insurance policies. Insurance is an attractive option for investment but most people are not aware of its advantages as an investment option. Remember that first and foremost, insurance is about risk cover and protection. By buying life insurance, you buy peace of mind. Insurance also serves as an excellent tax saving mechanism. The Government of India has offered tax incentives to life insurance products in order to facilitate the flow of funds into productive assets.

2.2 Types of Insurance:1. Endowment Policy

An endowment policy covers risk for a specified period, at the end of which the sum assured is paid back to the policyholder, along with the bonus accumulated during the term of the policy. 2. Unit Linked Insurance Plan Unit linked insurance plan (ULIP) is life insurance solution that provides for the benefits of risk protection and flexibility in investment.

3. Term Life Policy Term life insurance policy covers risk only during the selected term period. If the policyholder survives the term, the risk cover comes to an end. 4. Pension Plan or Annuities A pension plan or an annuity is an investment that is made either in a single lump sum payment or through installments paid over a certain number of years. 5. Group Insurance Policy Group insurance offers life insurance protection under group policies to various groups such as employers-employees, professionals, co-operatives.

6. Loan Cover Term Assurance Policy Loan cover term assurance policy is an insurance policy, which covers a home loan. Such a policy covers the individual's home loan amount in case of an eventuality. 7. Unit Linked Insurance Plan

Unit linked insurance plan (ULIP) is life insurance solution that provides for the benefits of risk protection and flexibility in investment. 8. Joint Life Policy Joint life insurance policies are similar to endowment policies as they too offer maturity benefits to the policyholders, apart from covering risks like all life insurance policies. 9. Whole Life Policy A whole life policy runs as long as the policyholder is alive. As risk is covered for the entire life of the policyholder, therefore, such policies are known as whole life policies. 10. Money-back Policy Money back policy provides for periodic payments of partial survival benefits during the term of the policy, as long as the policyholder is alive. 2.3 History & background of Insurance industry:The story of insurance is probably as old as the story of mankind. The same instinct that prompts modern businessmen today to secure themselves against loss and disaster existed in primitive men also. They too sought to avert the evil consequences of fire and flood and loss of life and were willing to make some sort of sacrifice in order to achieve security. Though the concept of insurance is largely a development of the recent past, particularly after the industrial era past few centuries yet its beginnings date back almost 6000 years. Ancient Indian history has preserved the earliest traces of insurance in the form of marine trade loans and carriers contracts. Insurance in India has evolved over time heavily drawing from other countries, England in particular. The changes in life insurance industry in India is seen in four different phases 2.4 Benefits of Insurance:-

Life Insurance Policy is a form of security for the person who insures his life and his family. Life insurance policies have helped trade and other economic activities to flourish in a great manner. It has generated lots of job opportunities. It is looked upon as a lucrative career option. Benefits of Client:A life insurance policy vouchsafes security for your dependents after your demise. They can seek out their living even at the absence of other active source of income. Moreover the amount that you are going to get at the end of the policy period in a term life policy also makes it a rewarding investment. The following reasons substantiate benefit of a life insurance policy for an individual. Early Deaths The mortality rate is experiencing a declining trend in many parts of the world. However it is also important to note that the age at which People die is also ever decreasing. Some reasons for this include unhealthy living style, stress, pollution, and some natural calamities. This necessitates people to make adequate measures to yield income for their family and dependents. This could be a serious concern if the insured happens to be the sole bread winner. Some individuals see this as an option to plan their retirement.

Advancements in Health Care The mortality rate has declined rapidly even though the fact remains that the number of people who die at an early age is on the increase. This is mainly due to the advancement in healthcare and the awareness on medical facilities. This results in an increased spending at an old age. This increased spending is also due to increase in the costs of living apart from paying expensive medical bills. Unless they invest in Life insurance or other forms of insurance like health insurance it becomes next only to impossible to meet the financial demands especially during the old days. Increase in the Cost of Living and Spending Power The purchasing power of the consumers and the standard of living has experienced a steep rise over the years. The increase in National Income and gross domestic product are

partly responsible for this. Individuals incur many unexpected expenses due to the growing needs. Insurance comes in handy to meet such an unexpected expense. It also makes sure that an individual is able to meticulously plan his finances. Insurance option is more or less an interest free loan. An individual can cancel his insurance policy and obtain a huge amount if it is imperative in meeting an urgent expenses and he does not have alternative sources for finance. Life insurance companies therefore do the needful to consumers. Tax Concessions Income tax concessions are available to individuals and corporate houses who adopt insurance policies. Many have been making investments in Insurance with the sole aim of enjoying tax benefits. This naturally increases spending power. Since the investments increases the economic activities in the country automatically increases. Best Option for Salaried Youth Insurance is by and large regarded as one of the savings scheme. Students who earn while studying and those who take up full time employment after their studies see insurance as a profitable scheme to regulate their savings. Apart from tax concessions life insurance entails individuals to enjoy more benefits as they have special and attractive schemes for this segment.

Benefits of Economy & Society: Provides Employment. Channelizes Capital Flow. Attracts international trading partners thereby bringing in more FDI and FII, along with technical expertise (actuarial knowledge domain). Supports ancillary industries by way of bonded product marketing.

 Supports a social cause, and hence sometimes looked up as social responsibility by the Corporate. Provides coverage and safeguard against potential loses. Insurance of Risk gives higher flexibility to Business. Phase I [1800-1900] Life Insurance in its modern came to India from England in the year 1818. The advent of life insurance business in India can be seen with the establishment of the Oriental Life Insurance Company in Calcutta. This Company however failed in 1834. In 1829, the Madras Equitable had begun transacting life insurance business in the Madras Presidency. 1870 saw the enactment of the British Insurance Act and in the last three decades of the nineteenth century, the Bombay Mutual (1871), Oriental (1874) and Empire of India (1897) were started in the Bombay Residency. This era, however, was dominated by foreign insurance offices which did good business in India, namely Albert Life Assurance, Royal Insurance, Liverpool and London Globe Insurance and the Indian offices were up for hard competition from the foreign companies. Phase II [1900-1955] In 1914, the Government of India started publishing returns of Insurance Companies in India. The Indian Life Assurance Companies Act, 1912 was the first statutory measure to regulate life business. In 1928, the Indian Insurance Companies Act was enacted to enable the Government to collect statistical information about both life and non-life business transacted in India by Indian and foreign insurers including provident insurance societies. In 1938, with a view to protecting the interest of the Insurance public, the earlier legislation was consolidated and amended by the Insurance Act, 1938 with comprehensive provisions for effective control over the activities of insurers. The Insurance Amendment Act of 1950 abolished Principal Agencies. However, there were a large number of insurance companies and the level of competition was high. There were also allegations of unfair trade practices. The Government of India, therefore, decided to nationalize insurance business. An Ordinance was issued on 19th January, 1956 nationalizing the Life Insurance sector and Life Insurance Corporation came into existence in the same year. The LIC absorbed 154

Indian, 16 non-Indian insurers as also 75 provident societies245 Indian and foreign insurers in all. The LIC had monopoly till the late 90s when the Insurance sector was reopened to the private sector. The history of general insurance dates back to the Industrial Revolution in the west and the consequent growth of sea-faring trade and commerce in the 17th century. It came to India as a legacy of British occupation. General Insurance in India has its roots in the establishment of Triton Insurance Company Ltd., in the year 1850 in Calcutta by the British. In 1907, the Indian Mercantile Insurance Ltd was set up. This was the first company to transact all classes of general insurance business.

Phase III [1956-2000]: Nationalization of Insurance Sector In 1957, a General Insurance Council, a wing of the Insurance Association of India was formed. The General Insurance Council framed a code of conduct for ensuring fair conduct and sound business practices. In 1968, the Insurance Act was amended to regulate investments and set minimum solvency margins. The Tariff Advisory Committee was also set up then. In 1972 with the passing of the General Insurance Business (Nationalization) Act, general insurance business was nationalized with effect from 1st January, 1973. 107 insurers were amalgamated and grouped into four companies, namely National Insurance Company Ltd., the New India Assurance Company Ltd., the Oriental Insurance Company Ltd and the United India Insurance Company Ltd. The General Insurance Corporation of India was incorporated as a company in 1971 and it commence business on January 1sst 1973. In 1993, the Government set up a committee under the chairmanship of RN Malhotra, former Governor of RBI, to propose recommendations for reforms in the insurance sector. The objective was to complement the reforms initiated in the financial sector. Phase IV [FROM 2000] Insurance Regulatory & Development Authority:-

Insurance Regulatory & Development Authority is regulatory and development authority under Government of India in order to protect the interests of the policyholders and to regulate, promote and ensure orderly growth of the insurance industry. It is basically a ten members' team comprising of a Chairman, five full time members and four part-time members, all appointed by Government of India. This organization came into being in 1999 after the bill of IRDA was passed in the Indian parliament. Impact of IRDA in Insurance Sector:The creation of IRDA has brought revolutionary changes in the Insurance sector. In last 10 years of its establishment the insurance sector has seen tremendous growth. When IRDA came into being; only players in the insurance industry were Life Insurance Corporation of India (LIC) and General Insurance Corporation of India (GIC), however in last decade 23 new players have emerged in the field of insurance. The IRDA also successfully deals with any discrepancy in the insurance sector. Liberalization of Insurance sector: Reforms in the Insurance sector were initiated with the passage of the IRDA Bill in Parliament in December 1999. The IRDA since its incorporation as a statutory body in April 2000 has fastidiously stuck to its schedule of framing regulations and registering the private sector insurance companies. Since being set up as an independent statutory body the IRDA has put in a framework of globally compatible regulations. In the private sector 14 life insurance companies have been registered. Under the IRDA Act, private companies can now operate in India's insurance industry. However, they must obtain a license from the IRDA before being permitted to write business. To have its license application considered, a domestic private company must be registered in accordance with the Companies Act of 1956 and have approximately US$ 20 million of investment capital. The specific licensing requirements that Private Indian Companies must fulfill are set forth in the Registration on Indian Insurance Companies Regulations, published by the IRDA 2000. The IRDA Act also lifts certain barriers to foreign direct investment in Indian insurance industry. Global insurers are now permitted to set up and register a domestic company in order to write business in India. However, regulations stipulate that they have a capital base

of at least US $ 20 million, and their investment in such company is capped at 26 percent. Thus, to participate in the market, they must form a joint venture with an Indian partner that is able to invest the remaining funds. The equity investments limit is the same for global reinsures seeking to write business in India, but they are required to put up a capital of approximately US$ 45 million in order to establish a domestic company. Since the IRDA first enacted these rules, 13 new life insurance companies have entered the market. The IRDA Insurance Brokers Act in India 2002 permitted overseas insurance and reinsurance brokers to enter the market, but with the same equity cap as that governing the operations of foreign insurers and reinsurers. Thus, foreign brokers must also form a joint venture with an Indian partner in order to establish an Indian broking house. 2.5 Competition:In the years since the IRDA Act initiated market reforms, the insurance sector has experienced some remarkable changes. The entry of a large number of Indian and Foreign private companies in life insurance business has to lead greater choice in terms of products and services. Increased consumer awareness of the benefits and importance of insurance and reinsurance has generated many more buyers; and new distribution channels among them brokers, banc assurance, the Internet, and corporate agents have provided additional ways of getting products and services to customers. Private insurance companies have to date written a small percentage of business in this sector during the last three years, but they have ushered in a competitive environment that has accelerated market growth. At present there are 23 private insurers with two standalone private players and remaining private-foreign joint venture. The no of Life insurance companies are: AEGON Religare Life Insurance Company Limited. Aviva Life Insurance Co. India Pvt. Ltd. Bajaj Allianz Life Insurance Company Limited. Birla Sun Life Insurance Co. Ltd. Bharti AXA Life Insurance Company Ltd.
Canara HSBC Oriental Bank of Commerce Life Insurance Co. Ltd.

 DLF Pramerica Life Insurance Co. Ltd. Future Generali Life Insurance Company Ltd. HDFC Standard Life Insurance Co. Ltd. IDBI Fortis Life Insurance Company Ltd.
ICICI Prudential Life Insurance Co. Ltd.

ING Vysya Life Insurance Company Ltd. Kotak Mahindra Old Mutual Life Insurance Limited. Life Insurance Corporation of India. Max New York Life Insurance Co. Ltd. Met Life India Insurance Company Ltd. Reliance Life Insurance Company Limited. SBI Life Insurance Co. Ltd. Shriram Life Insurance Co, Ltd. Star Union Dai-ichi Life Insurance Comp. Ltd. Sahara India Life Insurance Co, Ltd. Tata AIG Life Insurance Company Limited. 3.0 Max New York Life Insurance Co. Ltd. 3.1 Companys Introduction:Max New York Life Insurance Company is a joint venture between New York Life International Inc., a Fortune 100 company and America's largest life insurance provider and Max India Limited one of the leading multi-business corporations in India. Max New York Life Insurance Co Ltd is a Rs. 250 cr. joint venture with a paid up capital of Rs. 807 cr. Max New York Life Insurance started its commercial operations in India in 2001. It is the first life insurance company in India to be awarded the IS0 9001:2000 certifications. The company has around 133 offices all over the country.

3.2 Values:Knowledge:

Knowledge leads to expertise; and our expertise is in helping people protect themselves. Perfectly combining global expertise with local knowledge, we are India's life insurance Specialist. Max New York Life believes that for knowledge to be of value it must be focused, Current, tested and shared. Excellence: Excellence at Max New York Life implies the ability to perform at a consistently high level. Focused on the value of continuous improvement in people, processes and the organization, the company strives for the highest standards of quality in every aspect of its business. Honesty: Honesty is the heart of the life insurance business. It is all about trust. Transparency, integrity And dependability from the cornerstones of the Max New York Life experience. The Company ensures that everyone who represents the brand carries a promise: we care in word as well as deed. Caring: Max New York Life is redefining the life insurance paradigm by focusing on customers first. The service process is responsive, personalized, humane and empathetic. Every individual who represents the company is for us our brand champion.

3.3 Company Profile:Max New York Life Insurance Company Ltd. is a joint venture between New York Life; a Fortune 100 company and Max India Limited; one of India's leading multi-business corporations. The company has positioned itself on the quality platform. In line with its vision to be the Most Admired Life Insurance Company in India, it has developed a strong corporate governance model based on the core values of excellence, honesty, knowledge,

caring, integrity and teamwork. The strategy is to establish itself as a Trusted Life Insurance Specialist through a quality approach to business. 3.4 Products:Max New York Life brings to you specially customized products and services that are flexible and can be customized to suit your needs. It now has 30 life insurance products and health insurance including 8 riders that can be customized to over 800 combinations enabling customers to choose the policy or plan that best fits their need. Max New York Life also offers 6 products and 7 riders in group insurance business. The company has a plan for every need, designed as to meet your long term financial goals & aspirations. They help you fulfilling your dreams & commitments. The list of few plans provided by Max New York Life Insurance Company Limited is given below: 1. Individual Insurance: Protection Plan (including Whole Life Plan, Life Protector, Life Protector Plus, Life Partner Plus). Children Plan (Children Endowment Plan, Stepping Stones). Savings Plan (Life Gain Endowment Plan, Life Pay Money Back Plan, Life Gain Plus, 20 Year Endowment). Retirement (Easy Life Retirement Plan, Endowment to age 60 Plan). Unit Linked (Life Maker Investment Plan, Life Maker Pension Plan). Riders. 2. Group Insurance: Group Term Life. Group Gratuity. Employee Deposit Linked Insurance. Credit Shield. Unit-Linked Group Gratuity.

3. Max Assure: Max Assure Bonus Builder. Max Assure Business Builder. Max Assure Future Builder. Max Assure Family Money Back. Max Assure secure returns builder. 4. Rural insurance: Max Suraksha. Easy Term. Max Mangal Endowment Plan. Max Vriksha Money Back Plan).

5. NAV: Life Maker Investment. Life Maker Pension Plan. Life Maker Premium. Smart Steps. 3.5 Promoters:Founded in 1985, Max India Limited is a Public Limited company listed on the NSE and BSE of India with over 26,000 shareholders. Today, Max India Limited is a multi-business corporate, driven by the spirit of Enterprise, focused on Knowledge, People and Service oriented businesses of:

 Healthcare (Max Healthcare) Life Insurance (Max New York Life Insurance) Clinical Research (Neeman Medical International) Till 1999, The Companys Main Interests and Partnerships were the following: Business Bulk Active Pharmaceuticals. Electronic Component Distribution, Mobile Telephony. V-SAT Communications. Plating Chemicals. Information Technology.

Max also maintains Interests in: Specialty Plastic Products for the packaging industry (Max Specialty Products). Healthcare Staffing (Max Health Staff). Prominent shareholders are Mr. Analjit Singh and a leading private equity firm, Warburg Pincus which accounts for 28.7% of the total shareholding. The balance shareholding is held by the public and Institutional Investors. Partners DSM Gist Brocades Motorola, USA Avnet Inc., USA Hutchison Telecom Ltd. Hong Kong

 Comsat Investment Inc., USA & Lockheed Martin, USA Atotech, Germany Mind Crossing, USA

In 2000, the Company reinvented and restructured itself to focus on the businesses of Life under the theme, LifeOur Focus. Max New York Life Insurance, founded as a Joint Venture between Max India Limited and New York Life, a Fortune 100 company, is one of the leading private life insurers in India. Max Healthcare, a subsidiary of Max India Limited is Indias first provider of comprehensive, standardized, seamless, and integrated world-class healthcare services. 3.6 Mission: Become one of the top quartile life insurance companies in India. Be a national player. Be the brand of first choice. Be the employer of choice. Become principal of choice for agents. 3.7 Vision:To become the most admired life Insurance company in India. The insurance agents employed at Max New York Life Insurance Co Ltd are trained inhouse with a rigorous training program of over 152 hrs, much higher than the standard 100 hrs of mandatory training laid down by the IRDA. Around 345 Max New York Agent Advisors qualified for Million Dollar Round table (MDRT) membership in 2006. It is an internationally renowned congregation of world's top insurance agents. 3.8 Board of Directors:Mr. Analjit Singh, Chairman, Max India Limited.

Mr. Anuroop (Tony) Singh, Vice Chairman, Max New York Life Insurance. Mr. Rajesh Sud, CEO & Managing Director, Max New York Life Insurance Mr. Rajit Mehta, Executive Director, & Chief Operating Officer, Max New York Life Insurance. Mr. John Harrison, Director, Max New York Life Insurance Mr. Richard Mucci, Director, Max New York Life Insurance Dr. Omkar Goswami, Director, Max New York Life Insurance Mr. Rajesh Khanna,Director, Max New York Life Insurance. 3.9 Management of Company:Rajesh Sud,

Chief Executive Officer, Managing Director and Executive Director of Distribution Rajesh is a founder team member of Max New York Life Insurance Co Ltd (MNYL), a joint venture formed in the year 2000 between Max India Ltd and New York Life International of USA, to establish life insurance operations in India.

Rajit Metha,

Chief Operating Officer Rajit is a founder team member of the Max New York Life team and has seen the company through its formative years and in dealing with the challenge of recruiting the best talent available in the marketplace and building team spirit among people from diverse backgrounds. Anil Mehta,

Senior Director - New Markets SBU Anil Mehta has successfully led the companys sales efforts to large corporate houses. He earlier led the companys Product Management team through coordination across all functions and transfer of best practices from New York Life. Prior to his appointment at Max New York Life Insurance, Anil was regional Head of Credit, Personal Finance Services, Middle East and South Asia at ANZ Grindlays Bank. He has been responsible for Risk Management and Product Sunil Kakar,

Senior Director & Chief Financial Officer

Sunil Kakar is in charge of finance, accounts, investment management and risk management. Prior to joining Max New York Life, Sunil has 20 years of diversified banking experience with Bank of America in areas of Financial Control.

Ajay Seth,

Senior Director- Legal & Compliance Ajay Seth joined the company in April 2003 and in a short period of time he has helped evolve the companys legal and compliance strategy, striking a balance between business objectives and statutory and regulatory requirements. Debashis Sarkar,

Senior Director & Chief Marketing Officer Debashis Sarkar is responsible in strengthening and steering the Max New York Lifes marketing programme with a vision towards building Indias most admired life insurance company. He was also instrumental in establishing additional channels of distribution across the country. John Poole,

Appointed Actuary John Poole is the Chief Actuary at Max New York life and is also the Appointed Actuary for the Company in terms of Indian insurance Regulations. John joined MNYL in early 2005 following an 18th month sabbatical at his home town in Cairns, Far North Queensland, during which time he was studying at James Cook University and working on a contract basis for Sydney based Citicorp Life the reinsurer for all Citibank generated business in Asia.

3.10 Organizational Structure:-

M. Vice

Associate Vice Regional Multi Partner & Multiple Partner In

Partn Associate Assistant Sales Manager &Sales

Advisor &

Max New York Life Insurance FACT SHEET As of September 30th, 2008 Founded Started Operations Headquarters World Wide Web Address Chairman Managing Director & CEO Paid-Up Capital Employees Number of Products (Individual) Number of Riders/Options (Individual) Product Combinations Possible (Individual) Number of Products (Group) Number of Riders/Options (Group) Number of Offices Number of Offices Dedicated To Rural Business Number of Cities MDRTs 2000 April 2001 New Delhi, India http://www.maxnewyorklife.com Analjit Singh Rajesh Sud Rs. 1,432 crore 14,568 35 8 Over 800 6 4 443 39 (9 hub offices 30 spoke offices) 277
343 (for calendar year 2007)

History of Banking in India

Without a sound and effective banking system in India it cannot have a healthy economy. The banking system of India should not only be hassle free but it should be able to meet new challenges posed by the technology and any other external and internal factors. For the past three decades India's banking system has several outstanding achievements to its credit. The most striking is its extensive reach. It is no longer confined to only metropolitans or cosmopolitans in India. In fact, Indian banking system has reached even to the remote corners of country.

The first bank in India, though conservative, was established in 1786. From 1786 till today, the journey of Indian Banking System can be segregated into three distinct phases. They are as mentioned below:

Early phase from 1786 to 1969 of Indian Banks Nationalisation of Indian Banks and up to 1991 prior to Indian banking sector Reforms. New phase of Indian Banking System with the advent of Indian Financial & Banking Sector Reforms after 1991.

Phase I The General Bank of India was set up in the year 1786. Next came Bank of Hindustan and BengaThe East India Company established Bank of Bengal (1809), Bank of Bombay (1840) and Bank of Madras (1843) as independent units and called it Presidency Banks.l BaIn 1865 Allahabad Bank was established and first time exclusively by Indiansnk.

Phase II

Government took major steps in this Indian Banking Sector Reform after independence. In 1955 The following are the steps taken by the Government:

1949 : Enactment of Banking Regulation Act. 1955 : Nationalisation of State Bank of India. 1959 : Nationalisation of SBI subsidiaries. 1961 : Insurance cover extended to deposits. 1969 : Nationalisation of 14 major banks. 1971 : Creation of credit guarantee corporation. 1975 : Creation of regional rural banks. 1980 : Nationalisation of seven banks with deposits over 200 crore.

After the nationalisation of banks, the branches of the public sector bank India rose to approximately 800%

Phase III

In 1991, under the chairmanship of M Narasimham, a committee was set up by his name which worked for the liberalisation of banking practices. The gross and net non-performing assets of 13 private banks have increased by a 36.5 percent and 36.1 percent respectively during the financial year 2008-09. PSBs with a major share of corporate borrowings have been able to work around the norms. SBI, major public sector lender, restructured nearly 50,000 small and medium enterprise loans. Dena Bank and Bank of India restructured loans worth Rs 5,350 crore and Rs 4,800 crore respectively. Amongst the private banks, Yes Bank has shown the highest growth in NNPA, followed by South Ind Bank. The NNPA(National Newspaper Publishers Association) of the major private lender, ICICI Bank increased to Rs 4,554 crore during FY2008-09.

Rates of bank CRR SLR Bank Rate Repo Rate Repo Rate Reverse Repo Rate INR / 1 USD INR / 1 Euro INR / 1 Euro INR / 100 Jap. YEN INR / 100 Jap. YEN INR / 1 Pound Sterling INR / 1 Pound Sterling PLR Savings Bank Rate : 12.75%-13.25% : 3.5% : 5.00% : 24.0% : 6.0% : 4.75% : 4.75% : 3.25% : 48.1300 : 67.0300 : 67.0300 : 49.6900 : 49.6900 : 78.6637

Savings Bank Rate Deposit Rate

: 3.5% : 7.50%-9.60%

ICICI Bank

ICICI Bank Ltd., Indias largest private bank ICICI said its net profit after tax for the January to March quarter was 7.44 billion rupees ($147 million), down from 11.5 billion rupees in the same quarter last year. Total income slid to 92.0 billion rupees ($1.8 billion) from 103.9 billion rupees. Despite the headwinds, ICICI has continued to invest in its branch network. ICICI has 1,438 branches across India, up from 755 branches two years ago, and says it is in the process of opening 580 more.12% year-on-year increase in operating profit for the year ended March 31,2009.14% year-on-year reduction in costs due to cost rationalization measures Increase of Rs. 5,286 crore in CASA deposits in quarter ended March 31, 2009

About share holding pattern. As we can see in the investment pattern of Promoter and Promoter Group that 1367 of sub unites is being invested and from all insurance sector had made a investment of 5.12 % (70) which is a good sign for an investor to invest it an earn profit. In all FII has a major stand of 677 (49%) and than by mutual funds of 369 (26%).

Graph of ICICI bank

Study This table shows an investment and growth of company. Rate of bank before two year was down as compare to present year but as we can see the graph that Bank has made its investment in smart manner so it had touch the high rate but due to some reasons (rumors) it had came down

and now these script is moving good if a person wants to invest in these script for long term than a investor will earn a handsome amount of profit.

Balance Sheet

About Balance Sheet

Share capital of bank had being increased of almost 46% from past five year and pulse point of this bank is that it provide best service to its all costumers so bank had gain revenue of almost 320% as compared to year 2005 which is very good for any company as it attract more and more costumer as well as investors towards the bank. Along with revenue deposits, borrowing, and other liabilities & provision had also shown a good face to investor and costumes because of all this bank had became a no.1 bank and costumer also started trusting the bank.

Profit and Loss of company

About P/L

Total income of bank had increased by more than 200 % but it has taken a stop in 2008 due to some of the major reason (rumors) total income of bank had came down by 3 % as compared to previous year along with these expenditure, intrest expand and operating expenses had also saw a small fall but all over icici bank had moved good. While PBT of bank had increased this shows a posetive mark in market. On other hand bank had shown a good EPS(Earning Per Share) it has almost growth of 20% but 2008-09 was a turning point of its profit it has faced a of loss of 11% but all over it has saw a good profit. So, to buy this share for long-term is good. If a person, investor or any layman wants to know his/her profit than he can find it easily by calculating EPS of his share.

Union bank

Union Bank of India was inaugurated by Mahatma Gandhi eight decades ago. Union Bank of India is having more than 600 branches and extension counters all over the country. Nearly 351 ATMs are installed. Union Bank of India is a Public Sector Unit with 60.85% Share Capital held by the Government of India. Today there are more than 26,000 employees in Union Bank of India Key Performance figures of Union Bank of India for March 2005

Union Bank of India proposes a total dividend of 35% for 2004-05. Total business crosses the landmark figure of Rs.1 lakh crores. Bank posted a net profit Of Rs.719 crores for the year ended March 2005.

Operating profit For the year ended March 2005 was Rs.1, 573 crores showing a growth of 6.07%

Capital Adequacy stands at 12.09% as of March 2005. Earnings per share at Rs.15.64. Deposits at Rs. 61,822 crores. Advances Rs.41, 103 crores. Net Interest Margin is 3.31%. Cost of Deposits has come down from 5.64% in March'04 to 4.97% in March 05. Yield on Advances which was 9.03% in the year 2004 fell to 8.33% in the year 2005 Yield on Investment declined from 9.00% in March 2004 to 8.20% in the year under report. The Ratio of Net NPA to Net Advances has improved from 2.87% in 2004 to 2.64% in 2005

Union Bank of India IPO Union Bank of India came out with its Initial Public Offer (IPO) in August 20, 2002 and 39.15 % of Share Capital is presently held by Institutions, Individuals and Others.

About share holding pattern We can see the investment pattern of union bank. Central, State Government and Foreign investor had invested in same ratio of 55.43 which is good for a Bank so its also good to invest in these bank as a long term as well as for short term also. But ,I would like to invest for long term as we can see that Central, State Government and Foreign investor had invested in these bank from long term as we know that Foreign investor play a VITAL role to move script so we should invest it as a long term investor. Total investment in the bank is of Rs.226,768(100%), from which Rs. 6(3.3%) is being covered by insurance company like MNYL.

Graph

Study

This graph shows a progress in the script so to invest as a long term investor is good opportunity as from past two years its facing a Bull market. This script has shown almost a change of 75m so its good to enter in market to buy a script . Black line shows an AVERAGE of a script.

Balance Sheet

About Balance Sheet Share capital of union bank was 4601.18 (100%) in financial year 2005 which is being increased to 5051.18 a growth of almost 12% which had being remain constant till year 2008-09 .Though share capital was EQUAL bank had saw a bull market an enjoyed Revenue growth of almost 15% Y.O.Y . Bank also has a good borrowing, but had faced a loss of 20% from financial year 2008-07. In amount of liabilities it had taken a huge jump of 220% which is good for the bank. Other, total assets had also given a good response in all Total assets had sleeps up to 220%. I would like to suggest to all investor to invest it as a short term (INTRA DAY.) Profit and Loss OF UNION BANK

About P/L of UNION BANK

Script of this bank is interesting as interest of this bank is growing by 15% each year so it is expected to increase further in coming year. But other income of this bank has taken different face (loss), which shows a loss of 22%. As bank started working smoothly bank was again able to take off its flight and had became a stable company and had generated

income of more than 40% which was unbelievable. And from that bank was so successful that it has faced 100% growth as compared to financial year 2005 04. As well as total income had also saw a growth of 100%. As income had increased side by side expenses (operating expenses) had also increased. PBT (Profit before Tax) has saw a hick of more than 380% as compared to financial year 2004 05 .Taxes were negative in financial year 2004 05.As bank had moved good in that year so it came in profit and had able to pay tax .In financial year 2004 05 tax amount was -2149.40, but in financial year 2008 09 bank had paid tax of 12600 which is a big amount of tax to pay. Total Profit & Loss had also increased 150% .while EPS had become 2.5 times of financial year 2004 05.

State Bank of India

State Bank of India net profit up 45.62 percent May 9th, 2009 MUMBAI - The country's largest lender State Bank of India (SBI) Saturday reported a 45.62 percent rise in its net profit for the quarter ended March 31. State Bank of India (SBI), the countrys largest lender, has posted a net profit of Rs 9, 121 crore for 2008-09 as against Rs.6,729 crore the year before, a rise of 35.5 percent. Net profit for the fourth quarter (January-March) of 2008-09 increased 45.62 percent to Rs.2,742 crore from Rs.1,883 crore in the corresponding quarter of 2007-08, SBI chairman O.P. Bhatt told reporters here. The net non-performing asset (NPA) ratio for 2008-09 stood at 1.76 percent, compared to 1.78 percent in 2007-08. The total amount restructured during the year was Rs.8,310 crore .SBIs total income for the fiscal rose 33 percent to Rs.76,479.2 crore from the previous years Rs.57,645.2 crore. Consolidated net profit was at Rs.10,955.2 crore, a 22 percent increase from Rs.8,960.6 crore in 2007-08. The groups consolidated net income crossed the trillion rupee mark to Rs.113,093 crore (Rs.1.1 trillion) in 2008-09, 25 percent up from the previous fiscals Rs.90,218.8 crore. The bank is already present in 33

countries. SBI has plans to increase its Singapore operations from the present five branches to 12 this year and to 20 next fiscal.

About share holding pattern We can see the investment pattern of bank. Central, State Government and Foreign investor had invested in same ratio of 62.07 which is good for a Bank so its also good to invest in this bank for long term as we can see that Central, State Government and Foreign investor had invested

in these bank from long term as we know that Foreign investor play a VITAL role to move script so we should invest it as a long term investor. Among all three banks insurance company had invested the major amount among all. As insurance company had invested an good amount so if a normal investor wants to invest in it can earn a good profit in the investment of bank there is a investor like TRUST which is a good sign for bank
Graph of SBI

Study The banks price is volatile throughout its journey. It has shown a change of 10m from 215 225 only. During this period it has touch 290 as the highest and 150 as the lowest. So, this script has a good movement. If an investor wants to invest in this script than he should invest for short term may be as intraday investor

Balance Sheet

About Balance Sheet Share capital had increased to 6348.80 from 5262.99. i.e., 20% of financial year 2004 05 .were in journey of five year in financial year 2005 06 in financial year 2006 07 capital was same of 5262.99. total revenue had also increased in the journey of almost 111% as base year of 2004 05,along with Total Revenue Deposits, Borrowings, Other Liabilities & Provisions had increased .About funds Cash and balance ,Balances with banks and money at call and short notice , Investments , Advances , Gross Block , Other Assets , Total Assets , Contingent Liability Had also taken an good walk .But, Net Block was a fall for bank

Profit and Loss OF SBI

About Profit and Loss

Bank had earned 100% more interest in terse five finance year. Other Income, Total Income, Interest Expended, Operating Expenses, Operating Profit, Provisions and Contingencies has also shown a positive response. While PBT had moved good in five years .But, it has not given a good response as compare to past financial year 2007 2008, it has fall by 9.20% Again if will see on Total Expenditure, Profit & Loss, Reported Net Profit, Equity Dividend %, Earnings Per Share, Book Value per Share all of them had given a good profit. Ratios

All red marks indicates downturn and green shows up turn.

Conclusion:-

Above compression made of all three banks I came to Conclusion that ICICI Bank is the most preferred bank by many costumers as it provides the best service among all the banks and its the most TRUSTED BRAND amongst private bank and all private insurance, due to lot of efforts made by bank it had lead bank to No.1 There was an major fall in the share price of ICICI bank in financial year 2008 2009 because some of the rumors in the market ,as bank has its wide arms of network it has large numbers of branches ,1,438 branches across India, up from 755 branches two years ago, and says it is in the process of opening 580 more and also has a numbers of ATMS through with the help of his arms and trusted costumers bank was again able to stand on its position by doing these bank had proved its value to its costumer in market. Today the world is suffering through crisis but as the demand improves than we can see its benefit on the stock price, bank had proved him in the crisis market all because of its trust whicw his costumers has on bank Any countries Economy can be said developed or developing by its infrastructure and Banking, bank are the hidden face of any country. India is a developing country so if economy wants to regains than country needs money which will be lead by banks, banks are backbone of country and ICICI bank is backbone of all banks. Banking is the booming sector in country like India which is on the egad to fly needs lot of support to country which will open million of doors of jobs and numbers of opportunity for many people which will all lead to the growth of country.

Recommendation:-

Its great opportunity for all investor and for all intraday traders as insurance company, FII, and many traders has invested for long term. So, its easy to get profit and come with full handed. As EPS of bank is 34 which were 27 in finance year 2004 05 .Bank has good returns in all banks had moved smoothly in given graph ICICI had shown a fast take off and gives a good return. If will see at present scenario rate of ICICI bank is 628.65 with a fall of 13 %( 8.25) but if will have an watch on SBI than rate of bank is 1543.54 with an fall of 40 % (60.40) and all others bank had an fall of more than 10 %. So would like to suggest that share of ICICI bank is green for long term expected with an return of almost 30%.