CAPITAL MARKET OF S.B.I.

1.1-Introduction
In just 10 years, the SBI Group established a globally unique Internetbased financial conglomerate system. In order to further our domestic growth
and to grow exponentially overseas, in 2010 we adopted a new business strategy
for the SBI Group, Pentagon Management for financial service businesses.
The Pentagon Management business strategy aggressively pursues synergistic
effects within the SBI Group by positioning securities, banking, nonlife
insurance, life insurance and payment settlement services as the five core
businesses of our financial services business. As we transform ourselves from
Japans SBI to the Worlds SBI, we will target ever stronger growth in our
businesses.
Market share can be defined as the percentage of all sales within a market
that is held by one brand / product or company. Market share can be measured
in several ways. However, the two most important measures.
Share market is an area which fascinates each and every individual who is
craving for more money. Some common phrases are If we want to earn just try
with share markets; my friend has made lot of money in that . As beginners we
should understand one thing. If we are planning to invest in share market, first
we have to categorize our self.

1.2-SCOPE & IMPORTANCE

The scope of the study is to know the marketing strategies adopted by

SBI . Its not easy for covering all the boundaries for collecting the data. So, this
research study is covering some Important aspect. In this research study analysis
the marketing strategies of SBI.
The research project evaluation of the banking sector in India has primal
importance due to intense competition, and changing banking reforms. This
research project is very important because in today scenario there is strong
competition in public and private sector banks. Its very important for us to
know which sector is performing well and what are the marketing strategies
adopted by banks (public sector or private sector).
1-3-OBJECTIVE
Understand the strategies adopted by a market leader in the banking
industry to retain its market share
Explore the reasons how a market leader can loose its market share
significantly
Examine and analyze the key elements of the restructuring exercise
undertaken by SBI.
Study the marketing initiatives adopted by SBI to reposition itself as a
customer-oriented bank
Examine the challenges that can be faced by a market leader due to the
changes in the industry structure
Study and analyze the structure of the Indian banking industry.

1-4- METHODOLOGY

Research means a search for knowledge or gains some new knowledge and
methodology can properly refer to the theoretical analysis of the methods
appropriate to a field of study or to the body of methods and principles
particular to a branch of knowledge. A Research methodology has a specified
framework for collecting the data in an effective manner. Research
methodology means a defining a problem, defining the research objectives,
developing the research plan, collecting the information, analyzing the
information and presentation of finding.
1-5-Limitations of the study
It is important to critically evaluate the results and the whole study. The present
study has certain limitations that need to be taken into account when
considering the study and its contributions.
This study has focused on a phenomenon that is a very extensive and major one,
i.e. the market. Clearly, this represents a challenging task for research regardless
of the more specific interests that the study may have. In this study, this
extensive and complex phenomenon has been studied from a rather narrow
empirical perspective. The selection of the single case study design naturally
brings forth many limitations as far as the generalisation of the results of the
study is concerned.. On the other hand, this also represents the whole idea of
making a case study. By understanding something about this particular case
more in depth, we might eventually also learn something about more general
phenomena. research challenges in this topic. Multiple case study design would

enable us to test the conceptual framework of the study further. However, as the
theme of this study has been related to emerging market, it can of course be
seen that eventually the software component market are likely to develop so that
their emergence, even through multiple case studies becomes different, i.e. the
emergence needs to be studied retrospective.

1.6 - CHAPTER PLAN :Chapter

1- Introduction

Chapter

2- Share market as a profile

Chapter

3- Analysis of SBI share market

Chapter

4- Conclusion

SHARE MARKET AS A PROFILE

A Share market/stock markets is an open market for fiscal operations such as
trading of a firm's share and derivatives at a fixed cost. These securities are
further listed on a stock exchange. A Share market does not offer any corporeal
service and is not a separately owned business entity.
It was in 1875 that the Indian Share Market first started functioning. The first
share trading association in India was known as the Native Share and Stock
Broker's Association, only to become the Bombay Stock Exchange (BSE) later
on. This trading association started off its operations with around 318 members.

2.1 - Main components of Indian share Market

Bombay stock Exchange(BSE)
Bombay Stock Exchange is known to be the oldest stock exchange in the entire
Asian region. If someone wants to know about the history of the India share
market, it becomes synonymous with the history of the Bombay Stock
Exchange. It started functioning in 1875 with the name 'The Native Share and
Stock Broker's Association'. Under the Securities Contracts (Regulation) Act,
1956, the association got its recognition as a stock exchange in 1956. When it
started, it was just an association of persons but with the recognition it got
transferred to a corporate and demutualised entity.

Trading items in Bombay Stock Exchange Equity or Shares

Derivatives (Futures and Options)
Debt Instruments

The main index of BSE is known as the BSE SENSEX or simply SENSEX
(Sensitivity Index). It is an index which comprises of 30 financially sound

company scrips, with an option to be reviewed and modified from time-to-time.

The index calculation is based on the 'Free-float Market Capitalization'
methodology. Leading bourses like the Dow-Jones also follow this
methodology. Currently the Sensex is hovering around the 17,000 mark, all
expected to touch 20K by 2010. But then volatility has its important role to
spoil the entire game.

National Stock Exchange (NSE)

National Stock Exchange (NSE) is considered to be the leader in the stock
exchange scenario in terms of the total volume traded. The market capitalisation
the National Stock Exchange touched about $921.31 billion at the end of May
2009. The National Stock Exchange received the recognition of a stock
exchange in July 1993 under Securities Contracts (Regulation) Act, 1956. The
products that are traded in the National Stock Exchange are:

Equity or Share
Futures (both index and stock)
Options (Call and Put)
Wholesale Debt Market
Retail Debt Market

NSE has a fully automated screen based trading system which is known as the
NEAT system. The transactions are carried on with speed, efficiency, and are
all transparent. The risk management system of the National Stock Exchange is
world class and can be considered as the benchmark for other bourses.

The leading index of NSE is known as Nifty 50 or just Nifty. It comprises of 50

diversified benchmark Indian company scrips and is constructed on the basis of
weighted average market capitalization method.

2.2-Regulatory Authority of Indian Share Market

SEBI or Securities and Exchange Board of India is the market watchdog and
has the responsibility of protecting the investors' interests, develops regulatory
norms and helps in the development of the securities market in India.

2.3-Why to invest in Indian share market ?

An investor does not require a lot of money to start investing in India

share market unlike buying property and paying off a monthly mortgage.

Time of trading involved spans from small to big. One can trade for a
short period of time or even a lengthy span.

It helps you to see 'fast' cash if the market is in robust mood and helps in
fast liquidation.

2.4-Essential rules of Indian Share Market

Whenever share market is at its crest it is bound to dip at some point of

time.

If the share market is down, it will only increase if there are no external
aspects influencing it.

Unlike the common belief of investing in booming share market, it is

advisable not to block your hard earned money in already flourishing
Sensex and NIFTY. It is better to wait for market bottom trend and then
purchase shares at lower cost in order to trade it later.

The excellent time for investment is when the market is low keeping the
basics in consideration.

Seek the advice of professionals who will not only provide you tips on
best investment options but also on favorable market conditions.

Update yourself on the prevailing market conditions

Whenever market witness an upward trend always purchase first and then
sell the securities, and when the market dips always buy later and sell
first.

2.5-Tips on investing intelligently in Indian Share Market

Consider selling the shares which you have bought long time back and
are indicating gains. Even if they are not willing to offer you considerable
gains then its time to get rid of them are invest your money in productive
schemes.

Diversify your shares buy investing in different sectors. Also consider

investing in equity funds and to stabilize your equity investments invest a
part in fixed income options like the bonds, Public Provident Fund,
National Savings Certificates and post office deposits. You can also
consider a balanced or debt fund if you have restrained budget.

Do not consider the shares based on layman's advice. Stride carefully and
invest in shares that you are comfortable investing in. Judge the firm by
its past records and assess it personally. Take the advice of the fund
manager who manages that specific fund.

If you have allocated more than half of your investments in equity, then
stick to your plan. Do not surpass that pre-decided perimeter and believe
in the performance of the market.

2.6 -Are we a long term investor ?

Are we a short term investor ? ( Daily trading).
Note:

In share market we are 95% secured if we are ready to wait (provided company
fundamentals are good. Exclude cases like Enron, worldcom.etc) .The problem
comes when we have invested in a bank we can withdraw same amount with
interests till date for any of our emergency.
Assume our money is in form of stocks we got an emergency by today evening
7 pm of 1 lakh. We have seen our stocks worth in todays closing was our
investment 1 lakh + whatever market price added to it. We think we have more
than required and sell it tomorrow. But tomorrow fate decided the other way
market falls our stock value becomes 90 thousand. If we sell thats where the
problem comes.
It may even go up to 1.25 laks next week /next month. Can we wait? Thats the
million dollar question.

Case1 short term investor (Risky)

Remember its here we play not invest.
1. Make investment break ups: If we have x Rs in our hand dont get
carried away to buy shares for all x Rs. Always we should have fifty
percent in our hand.
2. Reinvest only when profits: Make the profits what we earn on the first
trade if daily trader (if so happens) to buy extra shares. Suppose if 0ur
stock didnt go up after first investment wait till (may be months) till our
holding goes up.
3. Capital maintain: Always ensure that our capital is maintained with till
date interest rate of banks. Though depository participants suggests us its
always better we should have basic ideas of the company. We have lot of
information sources (net, softwares).

4. In case of IPO: Buy and sell within max 1 week of IPOS. Invest in
established stocks. If we feel trend of IPO is good come back and invest.
5. Sell well ahead of your expected need: Suppose we have a marriage and
we wanted money for that. If we feel that today our investment + return
(m-cap) is good may be 30 days ahead of marraige.sell it today. We are
secured.
The very simple formula will be if we crave for more we have more chances to
lose more.
Case 2 Long term investor
Its here we invest. We are most secured in this case because we dont consider
money invested to be used for emergency. Any company will one day have a
growth curve. Even a sick company value can be raised by psychological
factors of investors.

2.7-Stock Market Tips

The Stock Market Tips we discuss in this article are not stock buying selling
tips but general tips about the way to approach stock markets. Trading requires
practice and a rational approach. You cannot make millions overnight. The
stock market is definitely a good opportunity to make some savings but you
should put in hard work and stay realistic. Success comes to those you learn to
survive against all odds and it applies to the stock market as well. You need to
know when you have to buy and sell so that you make enough profits and do not
lose your hard earned money in seconds.
Learn to exit on time. Most traders hold on to the stock even if it has crossed
their expectation level, with the hope that it may increase further. This happens

during a raging bull period. Be careful, as the market may come crashing down
and you will be left devastated and sad.
The stocks that you choose should move according to your expectations and sell
when breakeven happens. This is actually the first step for good trade practice.
Never lose heart while giving commissions, it is your brokers earnings and he
does that for a living. So do not fret when you have to shell our commission
money. Your main concern while trading is to limit losses and earn profits.
Keep a part of the money earned for a rainy day. Do not put all your cash into
one basket. Have a diverse portfolio so that you are not at the receiving end
when the market is down.
Judge your instincts. See if you are successful long term or short term trader.
Specialize in one field. Are your losses bigger on short term or long term
stocks? See which market gives you better returns. Trade in the other direction
only when things are going really good for you and the economic situation call
for a good trading season.
Use the end of the day market opinions and sessions to your advantage. Know
the general sentiment of the market. You should be through on the companies
that you are going to put your money on.
Learn to learn from your mistakes. Mistakes are inevitable but certainly not
worth repeating. The stock market sees the survival of the fittest and so don be
scared of losses. Convert the bear conditions to your advantage and make
profits during the Bull Run. Be persistent in your trade and learn to use the
rational method of thinking.

2.8-Examples of share market

Market share information on the UK clothing retail market is
summarized below:

Position Brand
1
2
3
4
5
6
7
8
9
10

Marks & Spencer

Next
Arcadia
Debenhams
Asda
Matalan
Tesco
Bhs
New Look
John Lewis
Total of Top 10
UK Market

Sales('m)
2,743
1,708
1,609
1,076
963
776
710
631
552
482
11,250
26,911

Market Share
(%)
10.2
6.3
5.9
4.0
3.6
2.9
2.6
2.3
2.1
1.8
41.8
100.0

Number of
Outlets
315
333
1,603
97
215
137
588
163
573
25

The UK clothing market, as defined by Deutsche Bank in their recent report, is

valued at 26.9 billion. It is one of the most concentrated retail markets in
Europe, with the top ten retailers accounting for some 42% of the market.
What is market concentration? It is the proportion of market value that is owned
by the leading brands or products/companies in the market. Where the market
leaders own a large part of the overall market, the market is said to be highly
concentrated. By contrast, where the market leader has a relatively small market
share and there are many other competitors, a market is said to be "fragmented"
There has been little change in the concentration of the UK clothing retail
market in recent years. The top 10 retailers accounted for 39% of the market in
1995. However, as the table below illustrates, the composition of the top 10 has
changed quite considerably, with only six of the top ten in 2008 remaining in
the top league in 2010:
Position

2008

2009

2010

M&S

M&S

M&S

Arcadia

Arcadia

Next

Debenhams

Debenhams

Arcadia

C&A

Next

Debenhams

Next

C&A

Asda

Sears

Sears/Adams

Matalan

Bhs

Bhs

Tesco

Littlewoods

Asda

Bhs

John Lewis

Littlewoods

New Look

10

House of Fraser

House of Fraser

John Lewis

The table above masks the change in the format of retail businesses that have
evolved in the UK over recent years. Five years ago, the value or "discount"
retailers had a relatively small share of the clothing market, accounting for only
18% total market share. Today the market is very different. The value or
discount retailers now have over a quarter of the market. Foreign clothing
retailers have also penetrated the market (e.g. the Gap, H&M and Zara)
although their total market share is still less than 5% .

3. ANALYSIS OF SBI SHARE MARKET

State Bank of India, together with its subsidiaries, provides various
banking products and services in India and internationally. Its personal banking
products and services include deposit schemes, such as current accounts,
savings accounts, term deposits, and recurring deposits; and loans that comprise
housing loans, car loans, educational loans, personal loans, loans for pensioners,
loans against shares and debentures, festival loans, and travel loans, as well as
mobile banking and demat services, automated teller machine (ATM) services,
gift cards and cheques, Internet banking, foreign inward remittance, safe deposit
lockers, and foreign travel cards. The company also provides corporate banking
services, which include working capital finance, project finance, deferred
payment guarantees, corporate term loans, structured finance, dealer and
channel financing, equipment leasing, loan syndication, and financing Indian
firms overseas subsidiaries or joint ventures; NRI services; agricultural/rural
services, such as agricultural banking and micro credit; and banking products

and services for small and medium enterprises. In addition, it offers

international banking products and services consisting of trade finance,
correspondent banking, merchant banking, project export finance, exporter gold
cards, treasury, and offshore banking services; and life insurance, merchant
banking, mutual funds, credit cards, factoring, security trading, pension fund
management, and primary dealership in the money market. As of March 31,
2010, it operated approximately 12,496 branches; and 21,485 ATMs of which
16,294 ATMs were owned by the company. The company was founded in 1806
and is based in Mumbai, India.

State Bank of India

State Bank of India

Type

Public (NSE: SBIN, BSE: 500112, LSE: SBID)

Industry

Banking
Financial services

Founded

1 July 1955

Headquarters Mumbai, Maharashtra, India

Key people

O. P. Bhatt
(Chairman)

Investment Banking
Consumer Banking
Commercial Banking
Retail Banking
Private Banking
Asset Management
Pensions
Mortgages
Credit Cards

Products

Revenue

133,851 crore (US$29.05 billion) (2010) [1]

Profit

11,733 crore (US$2.55 billion) (2010) [1]

Total assets

US$ 323.0 billion (2010)

Total equity

US$ 18.5 billion (2010)

Owner(s)

Government of India

Employees

200,299 (2010)

Website

Statebankofindia.com

State Bank of India is an India-based bank. In addition to banking, the

Company, through its subsidiaries, provides a range of financial services, which
include life insurance, merchant banking, mutual funds, credit card, factoring,
security trading, pension fund management and primary dealership in the
money

market.

It

operates

in

four

business

segments:

Treasury,

Corporate/Wholesale Banking, Retail Banking and Other Banking Business.

The Treasury segment includes the investment portfolio and trading in foreign
exchange contracts and derivative contracts. The Corporate/Wholesale Banking
segment comprises the lending activities of Corporate Accounts Group, Mid
Corporate Accounts Group and Stressed Assets Management Group. The Retail

Banking segment consists of branches in National Banking Group, which

primarily includes personal banking activities, including lending activities to
corporate customers having banking relations with branches in the National
Banking Group.

MUMBAI: The SBI group has seen its market share in bank deposits fall 100
basis points to 23.4% for the quarter ending December 2009 over the same
period a year ago as a result of its efforts to reduce high-cost deposits. However,
the group's market share in credit rose marginally during the same period.
Data from RBI's quarterly statistics on deposits and credit of scheduled
commercial banks show that the SBI group now accounts for 23.8% of all bank

lending, against 23.4% on December 2008. The market share of governmentowned banks rose from 49% to 50.6%.
Public sector banks have grabbed credit market share of private banks, which
now account for only 17.8% of bank lending compared with 20.3% in
December 2006 and 18.7% in December 2008. The sharp fall is largely because
of ICICI Bank's conscious decision to shrink its balance sheet. The bank has not
been lending as aggressively since the global meltdown. The market share of
foreign banks and regional rural banks as on December 2009 stood at 5.3%
(6.6%) and 2.5% (2.3%), respectively.
SBI's market share in deposits rose from 22.4% in the quarter ending December
2006 to 24.4% in December 2008.
However, after mopping up huge deposits in 2008-09, the bank found few
takers for loan as the credit market slumped world over. As a result, SBI
decided to go slow on deposit mobilisation. Its deposits rose 3.8% in the first
nine months of 2009-10. The market share of banks owned by government
banks (other than SBI) rose to 50.9% as on December 2009 from 48.3% a year
ago. The market share of private banks also rose to 18.6% from 17.1% while the
market share of foreign bank and rural regional banks stood at 5.5% and 3%,
almost flat.
Other data in the same reports shows that there is progress in penetration of
banking services. The smaller centres now account for an increased share of
bank business. Top hundred centres, arranged according to the size of deposits
accounted for 68.9% of the total deposits and the top hundred centres arranged
according to the size of bank credit accounted for 77.5% of total bank credit.
In December 2008, the corresponding share of top hundred centres in aggregate
deposits and gross bank credit was 69.2% and 78.6%, respectively. Aggregate

deposits of top hundred centres increased by 17.5% in December 2009 over

December 2008 compared with a growth of 20.2 % recorded a year ago. The
growth rate of gross bank credit of top hundred centres at 10.6% in December
2009 was substantially lower compared with 25.3% growth recorded in
December 2008.

Dec 08
Ratios
Market Price 1288
(Rs)

Mar 09

Sep 09

Dec 09

1067

2196

2235

Book Value
(Rs)

949

981

964

1003

Market
capitalization
(in Rs crore)

81788

67713

139409

141896

EPS
(Annualised)
(Rs)

134.09

143.77

151.85

153.30

Price to book
value

1.36

1.09

2.28

2.23

P/E ratio

9.61

8.06

13.72

14.58

ROA

1.02

1.04

0.95

0.94

ROE

14.12

15.73

15.75

15.29

3.1-State Bank of India

SBI is the largest bank in India with deposits of Rs 3,67,000 crore as on
March 31, 2005. It dominates the Indian banking sector with a market share of
around 20% in terms of total banking sector deposits. The increasing focus on
upgrading the technology back-bone of the bank will enable it to leverage its
reach better, improve service levels, provide new delivery platforms, and
improve operating efficiency to counter the threat of competition effectively.
Once the core banking solution (CBS) is fully implemented, it will cover over
10,000 branches and ATMs of the State Bank group, and emerge as the
strongest technology enabled distribution network in India. The increasing
integration of SBI with its associate banks (associates) and subsidiaries will
further strengthen its dominant position in the banking sector and position it as
the countrys largest universal bank.

3.2-Resource-raising capabilities
SBIs funding profile is strong, underpinned by its strong retail deposit
base. The bank is facing increasing competition in its metropolitan and urban
franchise. SBIs strong franchise gives it access to a steady source of stable
retail funds, which constitute around 59% of the total resources as on March 31,
2005 (56% as at March 31, 2004).
Savings deposits have shown a strong three-year growth of 19%. Thus,
despite a reduction in the proportion of current account deposits, low-cost

deposits have continued to constitute over 40% of total deposits as at March 31,
2005. The banks cost of deposits (excluding IMD) has significantly reduced to
4.70% for the 2004-05 (refers to financial year from April 1 to March 31),
compared with 5.48% in 2003-04. The banks liquidity position is very strong
due to healthy accretion to deposits, large limits in the call market, and
significant surplus SLR investments. SBI will maintain its strong funding
profile and a low cost resource position in view of its strong retail base and
wide geographical reach.

3.3-Earnings profile to remain good

SBI will maintain a good earnings profile in the medium term despite high
pressure on yields due to the increasing competition in the banking sector. SBIs
earning profile is characterised by consistency in the return on assets
(PAT/Average Assets), at around 1% per annum for the past three years, and
diverse income streams. To maintain yields and pursue credit growth, the bank
is aggressively targeting retail finance and small and medium enterprises
(SMEs). The banks core fee income of 1% of average funds deployed bolsters
its revenue profile. However, with the opening of government business like tax
collection to other banks and increased competition, the growth in fee income is
expected to slow down. The banks operating expense at 2.44% of average
funds deployed in 2004-05 is in line with other public sector banks. The banks
cost structure is rigid as fixed employee cost accounted for 74% of the operating
expenditure in 2004-05. Thus, despite good asset growth and technology
efficiency gains, the banks operating costs will remain high in the medium
term. To be able to reap the full benefits of technology implementation, the
bank will have to reduce or redeploy work force; since this is a sensitive issue, it
is expected to happen gradually.

The banks fund based and fee income earnings are diversified across industries,
regions, asset classes, and customer segments.
Strong diversification in income streams will ensure that the banks earnings
remain relatively stable, despite the decline in profitability in some segments.

Comfortable capital position

SBI is adequately capitalised with a tier I capital adequacy ratio of 8.04% and a
large capital base of Rs 240.72 billion as at March 31, 2005. The bank has
considerably improved its net worth coverage for net NPAs to 4.4 times as at
March 31, 2005 due to lower slippages reflecting an improving asset quality,
witnessed across the entire banking sector. The capitalisation levels of SBI are
adequate to address the asset side risks and support the business growth in the
medium term.

Management strategies
In retail finance, the bank has leveraged its corporate relationships, pursued
business growth selectively, and has not competed based on interest rate. The
bank has taken initiatives like on-line tax returns filing and faster transfer of
funds to protect its dominant position in the government business. The bank
also has a clear technology strategy that will enable it to compete with the new
generation private sector banks in customer service and operational efficiency.

Asset quality to remain at average levels

The bank continues to have a high level of gross NPAs at 5.95% of gross
advances as at March 31, 2005, compared with 4.9% for all scheduled
commercial banks (SCBs) taken together. The bank is facing challenges to
improve the quality of assets originated, as can be seen in the consistently
higher levels of slippages (additions to NPAs) at 2.71% in 2004-05.

To contain NPAs and ensure credit growth, the bank has decided to focus on
financing the retail (personal) segment as well as SMEs. The share of retail
advances has increased to 24.73% (Rs 522.08 billion) of total advances as at
September 30 2005. In the retail loan segment, SBI is targeting primarily the
housing loans segment, which constitutes Rs. 283.41 billion (54.3%) of total
retail loans. The NPAs in retail finance are low currently; however they are
steadily increasing (especially in the housing finance portfolio) and have started
showing signs of stress. SBIs retail portfolio has grown at over 37% CAGR in
the last two years and hence a significant portion of the portfolio is largely
unseasoned. The housing finance portfolio has a 12-month, lagged gross NPA
of 4.34% as at March 31, 2005.The bank will face significant challenges in the
medium term to develop effective credit appraisal and collection systems in
order to contain NPAs in retail finance. SBIs asset quality is expected to
remain at average levels, as the banks large and diverse asset portfolio reflects
of the asset quality of the banking system.

3.4-Business description
SBI along with its associate banks offer a wide range of banking products and
services across its different client markets. The bank has entered the market of
term lending to corporates and infrastructure financing, traditionally the domain
of the financial institutions. It has increased its thrust in retail assets in the last
two years, and has built a strong market position in housing loans.
SBI, through its non-banking subsidiaries, offers a host of financial services,
viz., merchant banking, fund management, factoring, primary dealership,
broking, investment banking and credit cards. SBI has commenced its life
insurance business by setting up a subsidiary, SBI Life Insurance Company
Limited, which is a joint venture with Cardiff S.A., one of the largest insurance
companies in France. SBI currently holds 74% equity in the joint venture.

Industry prospects
To leverage benefits such as access to low cost resources and the facility to
provide a larger gamut of services, a number of finance companies such as
Kotak Mahindra Finance Limited and HDFC Limited have promoted banks.
Simultaneously, yet another emerging trend is that of foreign banks promoting
NBFCs to benefit from regulatory flexibility available to such entities in areas
like absence of statutory liquidity ratio and cash reserve ratio requirements,
priority sector requirements, and corporate exposure limits.
New private sector banks capture market share With technological edge and a
strong marketing thrust, private sector banks have been stealing market share in
retail deposits and the corporate fee business from public sector banks. Together
with some foreign banks, these private banks have also aggressively entered the
retail asset financing space, hitherto the domain of non-banking finance
companies.
Given their focus on cross selling and optimising their customer base, they now
offer the entire range of products and services on the asset and liability side to
retail and wholesale customers

Asset quality to improve

Banks have not yet fully resolved the stress in the asset quality of their legacy
corporate loan portfolios, however. Though slippages to NPAs and provisioning
were high for some banks in FY2004, as they moved to the 90-day norm for
recognising and provisioning for NPAs, the treasury gains enabled significant
provisioning to be made with the result that net NPAs for most public sector
banks are now less than 3%.

Going forward, steady growth in gross domestic product should help improve
the banks asset quality and increase corporate lending. The securitisation and
reconstruction of financial assets and enforcement of security interest (Sarfaesi)
Act should also help banks in limiting slippages and improving NPA recoveries.

Better capitalisation levels

Banks have demonstrated a fair amount of flexibility in raising fresh equity
capital through public issues in recent years, thereby improving their
capitalisation levels. The steady accruals to net worth and falling nonperforming asset levels have resulted in an improvement in the capitalisation
position of banks in recent years.

Challenges ahead
Competition from new private sector and foreign banks remains a key challenge
for public sector banks. They need to reorient their staff and effectively utilise
technology platforms to retain customers and reduce costs. They also need to
fortify their credit risk management systems to mitigate the risks arising from
small-ticket lending to the retail, small and medium enterprises, and services
segments.

Consolidation and emergence of universal banking groups

The cap on foreign ownership of banks has already been raised from 49% to
74%. The competition in the sector could get further intensified if the 10% cap
on voting rights is also relaxed. New private sector banks are expanding their
geographical coverage and making inroads into government business. The new
private and foreign banks will continue to gain market share from public sector
banks because of their efficient cost structures, technological edge, focused
marketing approach and operational freedom. However, the emergence of newer
players would be restricted if the private ownership of banks is capped at low

levels.Mergers among PSBs would create banks with even larger balance sheets
and customer base. However, the integration process in such mergers is
expected to be complex and time long drawn. These would also be driven by
GoI due to provisions of Banking Companies (Acquisition and Transfer of
Undertakings) Act 1969, and hence political scenario will impact the timing and
permutations possible. Strategic alliances between banks and other financial
sector players such as insurance companies and mutual funds are also likely as
banks attempt to enhance their product range, leverage on economies of scale
and reduce costs.

3.5-Brokerage and investment banking business

Financial result of financial year 2009 -10
The Brokerage & Investment Banking Business in FY2008 was comprised of
two businesses, the securities business and the commodity futures business. The
securities business involves the brokerage of securities transactions, the
underwriting and selling of IPOs and the placement and distribution of
securities.
During the Initial Offer Period, Shares will be offered to the investors at the
Initial Issue Price.
After a period of six months from the closure of the Initial Offer Period i.e.
from 29th September 2006, Shares may be subscribed on any Valuation Day
twice every week at an Issue Price per Share based on the prevailing Net Asset
Value of the Fund (US Dollar Fund (Retail and Institutional Plans) and the Euro
Fund (Retail and Institutional Plans) ) per Share plus the applicable Sales
Charge.

Redemptions of Shares
After a period of six months from the date of closure of the Initial Offer Period
i.e. from 29th September 2006, an investor shall be entitled to redeem the
Shares on any Valuation Day at a Redemption Price per Share based on Net

Asset Value of the Fund per Share (i.e. US Dollar Fund (Retail and Institutional
Plans) and the Euro Fund (Retail and Institutional Plans)).

Investment Objectives and Policies

The Fund shall invest all or substantially all of its assets into the units of the
Scheme. The investment objective of the Fund is similar to that of the Scheme,
i.e., to provide investors with opportunities for long-term growth in capital
through well-researched investments in a diversified basket of stocks of Indian
Companies.

Investment conditions applicable to the Fund

In accordance with the SEBI in-principle approval, the Fund shall be required to
interalia comply with the following conditions:
(i) The Fund to be sponsored by the Scheme Asset Manager;
(ii) SBI MF to launch a scheme for investment in India and the units issued by
the scheme shall be subscribed for by the Fund only;
(iii) The Scheme Asset Manager to certify to the SEBI that it has obtained the
necessary approvals for the Fund in the overseas jurisdictions. Any financial
obligation arising out of the operations of the Fund shall be met separately,
without affecting the interests of the unit holders in other domestic mutual fund
schemes managed by the Scheme Asset Manager;
(iv) The Trustee shall monitor the activities of the Fund and shall confirm to
SEBI in their half-yearly reports that there is no conflict of interests between the
management of the Fund by the Scheme Asset Manager and its management of
the Scheme.
(v) The conditions of the Fund being broad based shall be built into the tripartite
agreement between the
Investment Manager of the Fund, the Trustees of the domestic mutual fund and
the Scheme Asset Manager;

(vi) The Investment Manager of the Fund shall ensure that the Fund complies
with the Know Your Client (KYC) and anti-money laundering requirements for
their overseas investors; and
(vii) The Fund shall also comply with any other requirement as stipulated by the
SEBI from time to time.

Findings
All of SBI Customer are satisfied with the services provided by the ban
Most of the customers prefer to invest in SBI share
A response form customer care is so clear & good

Many customer shifted from other place to SBI.

Reason for Interest of people

1. Quick processing
2. Transparency
3. Attractive growth rate
4. Stability
5. Simple & fast processing

4.2-Suggestion & Recommendation

Awareness programme is required
If these are any hidden data that must be disclosed
SBI should take some steps so that more people can get benefit
Better service should be provided
Investment benefits
High Growth rate in the share price i.e., better return on investment.
Dividend paid is also high which creates confidence among the investor.