INTRODUCTION TO INTERNATIONAL BUSINESS

TOPIC: INTERNATIONAL BRAND V/S DOMESTIC BRANDS

SUBMITTED BY:

AMRITKAUR SAGGU

PARTH SHAH

CLASS: TY-D

ROLL NO: 3230, 32

INTRODUCTION:

WHAT IS A BRAND?

A brand is a name, term, design, symbol or any other feature that identifies one seller's good or service
as distinct from those of other sellers. Brands are used in business, marketing, and advertising. Name
brands are sometimes distinguished from generic or store brands. Brands are different from products in
a way that brands are “what the consumers buy”, while products are “what concern/companies make”.
Brand is an accumulation of emotional and functional associations. Brand is a promise that the product
will perform as per customer’s expectations. It shapes customer’s expectations about the product.
Brands usually have a trademark which protects them from use by others. A brand gives particular
information about the organization, good or service, differentiating it from others in marketplace. Brand
carries an assurance about the characteristics that make the product or service unique. A strong brand is
a means of making people aware of what the company represents and what are it’s offerings. Brands
simplify consumers purchase decision. Over a period of time, consumers discover the brands which
satisfy their need. If the consumers recognize a particular brand and have knowledge about it, they
make quick purchase decision and save lot of time. Also, they save search costs for product. Consumers
remain committed and loyal to a brand as long as they believe and have an implicit understanding that
the brand will continue meeting their expectations and perform in the desired manner consistently. As
long as the consumers get benefits and satisfaction from consumption of the product, they will more
likely continue to buy that brand. Brands also play a crucial role in signifying certain product features to
consumers.

Global brands are brands that are recognized throughout much of the world while the ones that trade
in the domestic market are domestic brands. The two brands we are comparing today are GOLDMAN
SACHS(International bank) and SBI(Domestic Bank of India). Both of them operate giving various
services to their respective customers.

ABOUT GOLDMAN SACHS:

The Goldman Sachs Group, Inc. is A leading global investment banking, securities and investment
management firm that provides a wide range of financial services to a substantial and diversified client
base that includes corporations, financial institutions, governments and individuals. The firm is
headquartered in New York and maintains offices in all major financial centers around the world. The
bank is one of the largest investment banking enterprises in the world, and is a primary dealer in the
United States Treasury security market and more generally, a prominent market maker. The group also
owns Goldman Sachs Bank USA, a direct bank. Goldman Sachs was founded in 1869 and is
headquartered at 200 West Street in Lower Manhattan with additional offices in other international
financial centers.

ABOUT SBI:
The State Bank of India (SBI) is an Indian multinational, public sector banking and financial services
statutory body. It is a government corporation statutory body headquartered in Mumbai, Maharashtra.
SBI is ranked as 216th in the Fortune Global 500 list of the world's biggest corporations of 2018. It is the
largest bank in India with a 23% market share in assets, besides a share of one-fourth of the total loan
and deposits market.

The bank descends from the Bank of Calcutta, founded in 1806, via the Imperial Bank of India, making it
the oldest commercial bank in the Indian subcontinent. The Bank of Madras merged into the other two
"presidency banks" in British India, the Bank of Calcutta and the Bank of Bombay, to form the Imperial
Bank of India, which in turn became the State Bank of India in 1955.The Government of India took
control of the Imperial Bank of India in 1955, with Reserve Bank of India (India's central bank) taking a
60% stake, renaming it the State Bank of India.

 MOTIVATION TO CHOSE:

Being students of International Business and Finance, Banks have always been a keen point of
interest. Banks make a huge difference in the country they function bring in a lot of revenue and money
into circulation. Figure 1. Growth of the global banking industry

In the last decade, the top 1,000 world banks have grown

Assets ($T) Return on assets (%) Tier 1 capital/assets (%)

Sources: Danielle Myles, “Top 1000 World Banks 2018,” The Banker, July 2, 2018; Danielle Myles,

“Top 1000 World Banks 2017,” The Banker, July 3, 2017; Charles Piggott, “Top 1000 World Banks

2009,” The Banker, June 24, 2009

 OBJECTIVES:
1. To understand how international and domestic brands function.
2. To understand how they are related and similar to each other.
3. The difference they make in their respective economies.
4. To study in depth the brands and the customers they serve.
  FRAMEWORK USED:
To understand how these banks work, we are going to compare on 6 Parameters which are as
follows:
a) Balance sheets
b) Cost statements
c) Assets and Liabilities
d) Annual Profits
e) Tech- Savviness of the firms
f) Market Share prices, etc.

 Quality of Service

Goldman Sachs:
Investment banking

In 2015, investment banking accounted for 21% of total company revenues. Investment banking includes
financial advisory (mergers and acquisitions, investitures, corporate defense activities, restructuring, and
spin-offs) and underwriting (capital raises, public offerings, and private placements of equity and debt
instruments).

Goldman Sachs is one of the leading M&A advisory firms, often topping the Thomson Financial league
tables in sizes of transactions. The firm gained a reputation as a white knight in the mergers and
acquisitions sector by advising clients on how to avoid unfriendly hostile takeovers. During the 1980s,
Goldman Sachs was the only major investment bank with a strict policy against helping to initiate a
hostile takeover, which increased the firm's reputation immensely among sitting management teams at the
time.

Investing and lending

In 2015, investing and lending accounted for 16% of total company revenues.

Institutional Client Services

In 2017, Institutional Client Services accounted for 37% of revenues.

The segment is divided into four divisions and includes Fixed Income (the trading of interest rate
and credit products, mortgage-backed securities, insurance-linked securities and structured and derivative
products), Currency and Commodities (the trading of currencies and commodities), Equities (the trading
of equities, equity derivatives, structured products, options, and futures contracts), and Principal
Investments (merchant banking investments and funds). This segment consists of the revenues and profit
gained from the Bank's trading activities, both on behalf of its clients (known as flow trading) and for its
own account (known as proprietary trading).

Investment management

In 2015, investment management accounted for 18% of total company revenues.

The Investment Management division provides investment advisory and financial planning services and
offers investment products (primarily through separately managed accounts and commingled vehicles)
across all major asset classes to a diverse group of institutions and individuals worldwide. The division
provides clearing, financing, custody, securities lending, and reporting services to institutional clients,
including hedge funds, mutual funds, and pension funds. The division generates revenues primarily in the
form of spreads, or management and transaction fees.

Corporate Derivatives
The Corporate Derivatives team works with corporations to develop customized risk
management strategies.
Corporate Finance Solutions
The Corporate Finance Solutions team helps businesses structure complex transactions.
Equity Capital Markets
The Equity Capital Markets team works closely with public and private companies, governments
and financial sponsors to originate, structure and execute equity and equity-linked financings
such as initial public offerings, follow on offerings, convertibles and derivatives.
Investment Grade Capital Markets
The Investment Grade Capital Markets team provides guidance on capital structure across debt,
hybrid, derivative and equity-linked products for organizations with high credit-quality ratings.
The team’s syndicate desk is responsible for marketing, pricing and distributing new corporate
bond, hybrid and preferred stock US-dollar issues for companies around the world.
Latin America Financing Group
The Latin America Financing Group consists of professionals situated in regional offices across
Latin America as well as our New York headquarters. The team is responsible for covering
sovereigns, financial institutions and a broad range of corporate clients. Transactions the team
are involved in vary from leveraged loans and structured finance, including straight capital
markets debt issuance, to equity and equity linked issuance. The diversity of clients and products
we cover creates a highly entrepreneurial and creative environment.
Leveraged Finance Capital Markets
The Leveraged Finance Capital Markets team originates, structures and executes bank loans and
high yield bond financings for corporate clients and financial sponsors. Some transactions
include leveraged buyouts, refinancings and restructurings. The team’s syndicate desk is
responsible for underwriting and syndicating bank loans and high yield bonds.
Liability Management
The Liability Management team advises on and executes public and private debt transactions
including tenders, exchange offers, and consents. These transactions are often executed as part of
broader corporate restructurings, asset sales and refinancings.
Strats
The professionals in the group develop quantitative and technical solutions for IBD’s clients in
partnership with teams throughout the Financing Group, IBD Classic, and the Securities
Division.
Structured Finance
The Structured Finance team helps clients securitize assets, businesses and risks associated with
acquisition financing and balance sheet management. The team’s product suite includes
catastrophe bonds, film, entertainment and aircraft financing, and the securitization of franchise
royalties, intellectual property, infrastructure, auto loans, student loans, and life insurance.

https://www.goldmansachs.com/what-we-do/index.html

SBI –

As an agent of the Reserve Bank, the State Bank performs the following functions:
(i) It acts as the government’s bank, i.e., it collects money and makes payments on behalf of the
government and manages public debt.
(ii) It acts as the bankers’ bank. It receives deposits from and gives loans to commercial banks. It
also acts as the clearing house for the commercial banks, rediscounts the bills of exchange of the
commercial banks and provides remittance facilities to the commercial banks.
3. Ordinary Banking Functions:
The State Bank of India performs all kinds of commercial banking functions:
(i) It receives deposits from the public.
(ii) It gives loans and advances against eligible securities including goods, bills of exchange,
promissory notes, fully paid shares of companies, immovable property or documents of title,
debentures, etc.
(iii) It invests its surplus funds in government securities, railway securities and securities of
corporations and treasury bills.
4. Other Functions:
The State Bank of India also performs the following other functions:
(i) It buys and sells gold and silver.
(ii) It acts as agent of cooperative banks.
(iii) It underwrites issues of stocks, shares, debentures, and other securities in which it is
authorised to invest funds.
(iv) It administers, singly or jointly, estates for any purpose as executor, trustee or otherwise.
(v) It draws bills of exchange and grants letters of credit payable out of India.
(vi) It buys bills of exchange payable out of India with the approval of the Reserve Bank; it
subscribes buys, acquires, holds and sells shares in the capital of banking companies.
5. Prohibited Functions:
The State Bank of India has been prohibited from doing certain businesses by the State
Bank of India Act:
(i) The State Bank cannot grant loans against stocks and shares for a period more than six
months.
(ii) It can purchase no immovable property other than its own offices.
(iii) It can neither rediscount nor offer loans against the security of exchange bills whose
maturity period exceeds six months.
(iv) It cannot rediscount bills which do not carry at least two good signatures.
(v) It can neither discount bills nor grant credit to individuals or firms above the sanctioned limit.

http://www.economicsdiscussion.net/india/state-bank-of-india/state-bank-of-india-establishment-
objectives-functions-and-achievements/31372
  Difference Between Investment Bank (Goldman Sachs) and
Commercial Bank (SBI)

 Balance sheets of the two Banks:

  Tech Savviness of the Companies
 Goldman Sachs -
 Goldman Sachs Group Inc on Wednesday launched an initiative to attract tech-savvy
engineers to the bank to take part in a year-long program aimed at developing new
finance apps and other innovations, according to the company’s website.
 The company is soliciting research proposals from “curious” engineers for a new digital
innovation program. Those selected will receive $100,000 in wages and access to its code
that allows software programs to communicate with each other, known as application
program interface (API).
 Goldman’s move is part of a broader trend among companies, including Alphabet Inc's
Google, Twitter Inc and Spotify Technology SA, to make similar code available to
individuals outside of its company, hoping that their involvement will spur new apps and
other ideas.
 The bank is interested in research about mobile apps, trading strategies, and data
visualization, among other things.
 Goldman will select proposals based on “novelty, commercial opportunity, feasibility,
and the extent to which they utilize the Goldman Sachs platform, among other
considerations,” the company said.
 https://www.vccircle.com/goldman-sachs-wants-curious-engineers-to-drive-digital-
innovation/



 SBI –
 Rajnish Kumar, the new chairman of State Bank has called upon the over 2.68 lakh Team
SBI to work towards turning the nation's largest lender into a digital fortress even as they
up keep the high ethical standards the organisation has built over the years.
 Kumar took charge as the 26th chairman of the 211-year-old SBI last Saturday from
Arundhati Bhattacharya, who on her last presser, had said digitation was one of the
unfinished agendas she was leaving to her successor to complete.
 Asserting that technology is radically changing the way banking is done now, Kumar, in
a letter to the staff, today said one of the hallmarks of technology is the transformative
way it functions, so to make technology meaningful organisations need to assimilate
technology in to their operational culture.
 "But bare adoption of digital platforms for delivery is not going to serve us. We need to
educate and functionally update ourselves on tech-front continually for providing an
easy-to-navigate and seamless digital services especially for millennials and the gen-x
customers.
 "Only then, technology will provide us with a sustainable and competitive advantage.
Only then, we would be able to efficiently deliver new-age banking to new India," Kumar
said in the letter.
 Recalling the huge strides that SBI has achieved in the past few years on the digital front,
he said, "Till a few years ago we were perceived as a traditional bank. But today we stand
out as a technology-savvy, modern and forward-looking bank, be it on the delivery
channels,new cutting technologies, products and services, we are offering a slew of new-
age banking services to meet the financial needs of one and all."
 He thanked all his predecessors, especially Bhattacharya, "from whom I have taken over
a sterling legacy and a host of path-breaking initiatives."
 Stating that SBI cannot sit on the laurels it has achieved in the past, he underlined that the
banking is passing through very tough times not just in the country but across the globe.
 "Despite our grit, fortitude, hard work and resilience, we also could not stay insulated
from the unfavourable macro conditions but challenges inspire us. We are wired that
way," he said.
 Urging every SBI employee to be the face of the bank, he said, "A bank is as good as its
frontline people. Being polite to your customers is the best way to grow your community
of loyal customers.
 "We may have the best of the products, technology, ambiance but if we are not courteous
and polite to our customers, our business will not endure. We will not progress.
Politeness is what builds a great bank," he said.

https://www.business-standard.com/article/finance/sbi-chairman-rajnish-kumar-wants-
staff-to-be-tech-savvy-with-human-touch-117100901246_1.html