SWOT ANALYSIS

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 CONCEPTUAL FRAMEWORK

Meaning

A non performing asset (NPA) is a loan or advance for which the principal or interest
payment remained overdue for a period of 90 days. Description: Banks are required to
classify NPAs further into Substandard, Doubtful and Loss assets.

PROCEDURE FOR DETERMINING NPA STATUS FOR VARIOUS CREDIT

FACILITIES:

TERM LOAN:

A term loan account will be treated as NPA if interest/installment remains overdue for a
period of than 180 days.

CASH CREDIT AND OVERDRAFTS:

A cash credit or overdrafts will be treated, as NPA is the account remains out of for a period
of more than 180 days. An account should be treated as of order if the outstanding balance
remains continuously in excess of sanctioned IHIL drawing power.In cases where the
outstanding balance in the principal operating account is less than the sanctioned limit/
drawing power but there are no credits continuously for six months as on date of balance
sheet or credits are not enough to cover the interest debited during the same period such
accounts should also be treated as out of order.

As classification of an asset as NPA is based on the recovery of an advance, account may

not be classified as NPA merely due to existence of some deficiencies which are of
temporary nature, such as non availability of adequate drawing power, balance outstanding
exceeding the limit, non submission of stock statements and non renewal of the limits on
due dates.

In other words on the case of parties who are having difficulties in meeting their
commitments due to genuine problems such as delay on realization of bills on due dates,
piling up of inventories due to market recession etc. and the account is overdrawn such of
the accounts need not be classified as NPA merely because of excess over the drawing

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power/sanctioned limit as on the balance sheet date. But it should be ensured that interest
should not be in arrears for two-quarter and or more and the irregularities should have been
regularized subsequently.

Nevertheless when there is a threat of loss or the advance is in doubt the asset should be
classified as NPA.

Bill Purchased and Discounted:

The bills purchased /discounted should be treated as NPA of the bill remains overdue and
unpaid for a period of more then 180 days as on the date of balance sheet. However overdue
interest should not be charged and taken to profit and loss account in respect of overdue
bills unless they are realized.

Treatment of certain special types of advances:

Advances granted against the following could be classified as Standard Asset even though
there is overdue interest and installment provided the outstanding is covered by sufficient
margin,

a) Loans against banks term deposits.

b) Loan NSC/LIC (Surrender Value)

c) Loans against Indira Vikas Patra and Kisan Vikas Patra.

Advances granted under rehabilitation package approved by BIFR/Term lending

Institution:

The status of an asset where the terms of the loan agreement regarding interest and principal
have been renegotiated or rescheduled under rehabilitation package should be retained in the
same category applicable prior to the date of rehabilitation for at least two years of
satisfactory performance under the renegotiated or rescheduled terms. This means the
classification of an asset should not be upgraded merely as a result of rescheduling unless
there is satisfactory compliance of the above condition.

However RBI has since reduced the waiting period of two years of Up gradation to one
year. Therefore of the interest and installment of loans have been serviced regularly as per

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the terms of Rescheduled for one year (or four quarters) then the account could be upgraded
to standard.

If any additional facilities are sanctioned under the rehabilitation package they may be
treated as standard for a period of one year from the date of disbursement. The guidelines on
income recognition, asset classification and provisioning will apply to them after a period of
one year from the date if disbursement.

Agricultural Advance:

Advance granted for agricultural purpose may be treated as NPA if interest and / or
installment of principal remains unpaid after it has become past due for two harvest seasons
but for a period exceeding two half years. Where natural calamities impair the repaying
capacity of agricultural borrower banks have been permitted to decide in their own as a
relief measure.

i. Conversation of the short-term production loan into a term loan or re-

schedulement of the repayment period.
ii. The sanctioning of fresh short –term loan.
In such cases of conversion and re-schedulement the term loan as well as fresh short
term loan may be treated as current dues and need not be classified as NPA.

The asset classification of these loans would therefore be governed by the revised terms and
conditions and would be treated as NPA if interest and/or installment of principal remains
unpaid after it has become past due for two harvest seasons but for a period not exceeding
two half years.

Consortium advances:

In respect of consortium advances, each bank may classify the borrower accounts according
to its own record of recovery and other aspects having a bearing on the recoverability of the
advances as in the case of multiple banking management.

Project finance:

Normally in the case of new units, repayment is fixed taking into account the moratorium
period foe commencement of commercial production. However, in most of the cases, the
units could not reach the projected level and volume of production immediately after the

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commencement if production and is unable to generate the required cash flow to service the
loan.

In such cases, where the unit could not stabilize its production due to certain constraints
during the initial phase of production, bank may review such cases to the board for re-
schedulement of the repayment period and the account may continue to be treated as
Standard after the re-schedulement and the classification will be based on the revised terms
as per re-schedulement. The main factor for considering the re-schedulement should be to
ensure that the constraints faced are of temporary nature not indicative of any long-term
impairment of the units’ economic viability and the unit to achieve cash break-even if
moratorium period is extended. However, such extension of the loan time should not exceed
one year from the date of commercial production.

Government Guaranteed Accounts: For purposes of income recognition, the government

guaranteed advances are also to be treated as NPA if interest/ installments remain unpaid for
two quarters.

Units under Rehabilitation:

When fresh working capital or term loan facility is extended as a part of rehabilitation
package, fresh facility could be classified as standard for one year from the date of
disbursement and interest could be recognized accordingly

LCBR (Letter of credit bills receivable account)

Normally when the constitutes acquire raw materials / machinery under letter of credit on
DP terms banks debit the constituents. However, if there is no sufficient power, then LCBR
account is debited. It should be noted that LCBR liability is also fund – based liability and
the account will become NPA if it remains unpaid / unrecovered for 6 months from the date
of lodgment in the LCBR.In respect of documents on acceptance L.C. the treatment is the
same and the liability under “Acceptances and Endorsements” (A & E) will be treated as
NPA if it is not liquidated within 6 months from the due date.

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Staff Loans:

Staff loans are also to be treated like other accounts for determining the NPA status.

GENERAL:

a) Partial Recovery of Interest:

As per the prudential norms, interest income on Non-performing assets could be recognized
only on realization and not on accrual basis. Hence, wherever there is a recovery in a Non-
performing account, banks are in order to appropriate the recovery first to the indebted
interest and take the credit to the profit and loss account. After appropriating the indebted
interest. Any surplus left could be appropriated towards the principal outstanding.

b) Credit card out standings:

Balance in credit card holder’s account is to be treated as part of bank advance and
prudential norms are to be applied as applicable to other advances.

c) In the normal circumstances banks should stop taking credit of interest income and
profit and loss account from the quarter the account becomes NPA. However,
If banks has already debited interest in the party’s account and taken the credit to profit and
loss account for the earlier quarters, the interest credited should be reversed to the Bank’s
profit and loss account if it remains uncollected.

d) Treatment of borrower account as NPA:

Even if a particular credits facility or part thereof has become NPA. All the credit facilities
granted to the borrower will have to treat as NPA. In effect, the treatment of an asset as
NPA should be made borrower-wise and not facility-wise. However, this stipulation will not
apply to the fresh credit facilities sanctioned to a rehabilitated unit.

e) Projects:
In the case of Bank finance for industrial projects/for agricultural projects etc., where
moratorium is available for payment of interest such interest becomes, due for payment only
after the moratorium or gestation period is over. As such these credit facilities do not
become NPA during moratorium period.

PROVISIONING REQUIREMENT:

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 Taking into account the time lag between an account becoming doubtful of recovery its
recognition as such, the realization of the security and the erosion over time in the value of
security charged to the bank, RBI decided that banks should make provision on a regular
basis against standard, sub-standard, doubtful and loss assets.

a. Standard Assets:
Banks have to make a general provision of a minimum of 0.25% on its standard assets.

b. Sub-standard Assets:
A flat provision of 10% has to be made on the outstanding of the borrower account. It is to
be noted that no deduction is allowed in respect of security value or DICGC/ECG cover
available in computation of the provision.

c. Doubtful Assets:
For the computation of the provision requirements on respect of doubtful assets. The
doubtful assets are classified as D-1, d-2 and D-3 according to the age of NPA and provision
is calculated as per table under:

If the outstanding is not fully covered by security and DICGC/ECGC cover 100% provision
has to be made on the balance unsecured portion. In respect of additional provision required on
the assets which have become doubtful on account of reduction in the time frame for standard
assets from 2 years to 18 months, the provision requirement may be spread over two years i.e.,
50% to be made as on 31st March 2005 and balance 50% to be made as on 31st March 2006.

d. Loss Assets:
In respect of loss of assets as there is no security available 100% provision is made on the net
outstanding after deducting DICGC/ECGC cover if available.

If substantial security is available which is considered realizable the credit facility should be
treated as doubtful. However, if the realizable salvage value of the security is negligible then the
account should be classified as loss asset and provision should be made for 100% of the
outstanding after deducting the salvage value e.g., if dues to the bank are 0.01 lac the provision
should be made for Rs.0.99 lacs.

Prevention of non-performing assets:

Investment in loans or advances is one segment of operation for the present day bankers, which
they can hardly afford to lose sight of. Here what is important is not to make investment but to

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invest in assets, which for the times to come should remain performing to give regular income.
For ensuring extension of sound lending. Reserve bank and individual banks laid emphasis on.

1. Pre sanction appraisal

2. Post Sanction Follow up.
1) Pre sanction appraisal:

It becomes imperative that the funds lent by bank as loans are received back timely for maturity
match and cycling and to make it sure the banks are required to follow certain principles of
lending not only at pre sanction stage but at the post disbursement stage also.

These basic principles include safety advance, purpose of advance liquid, security and
profitability. Following points should be taken care of at the time of pre-sanction appraisal.

Credit Policy:

The loans should be sanctioned keeping in mind the current policy of Reserve Bank of India
and the Bank.

Borrowing unit and the Industry:

Before considering any unit for finance care should be taken to know the status of the
Industry in the economy and position and strength of the unit in the industry.

Promoter’s Financial Stakes:

For this owned funds Vis-à-vis the long-term debts (debt equity ratio) are to be taken care of.
The unit should generate funds to service installment and interest hence debt service coverage
ration and cash flow to be taken care of.

Current asset to current liability ratio should be taken care of know the liquidity position of the
unit. In case the units is not having adequate contribution towards financing the current assets it
is likely to resort to undesirable practices like frequent

over drawings, inflated inventories irregularly in cash credit and other accounts etc.

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For exiting units it should be profit-earning units and should have growth in turnover in value
and quantitative terms from year to year.

Security:

The security in any loan account could be principal security or the collateral security and the
nature of their securities need to be examined taking into account their life, durability, selling
position, reliability, demand etc. where ever needed collateral security or guarantee must be
obtained. However viable proposals should not be turned down merely for want of security.

It should always be borne in mind that the best security is the borrower himself and availability
of security in no way changes the status of account from non-performing to performing.

Management:

The credibility, capacity and capability of the promoters play very important role in making
ventures successful. Hence it is of utmost necessity that discreet queries about the promoters.
(The integrity, expertise in business and business stakes) should be made to ascertain the
bonfires.

Terms and Conditions:

While sanctioning such conditions should be put which the borrower can comply. The terms
and conditions should be discussed with the borrower and in case of difference necessary
understanding to be reached.

Assessment of credit requirements:

The assessment of working capital requirements is must otherwise under financing or over
financing can be disastrous.

The assessment of working capital must be based on the nature and operating cycle of the
activity of the borrowing entity and provision for contingencies also must be made. The current
price level of inputs and output should be taken into account while assessing the credit
requirement.

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RISK MANAGEMENT:

The Risk Management in the present banking context can be defined as current or latest,
independent and professional assessment of ability of the borrowing entities with respect to
their specific obligation of repayment of principal and interest in time preferably from the
income to be generated by the activity which is being assisted and conduct of their loan
accounts on the sanctioned conditions.

Risk management can be thought of as an important tool of managing the credit related risk to
achieve the organizational objectives of earning better yield from deployment by not allowing
the lending to become non-performing advances which involves extra prudence on the part of
banks. It is the rationale handling of a situation after property understanding all the issues risk
involved. So as to avoid the losses which may arise because of existence o some elements un-
favorable to the transaction to prove itself a profit earning one.

In the context of bank lending operation, it being with a scientific identification of the risk
involved in the loan transactions along with nature and frequency of such risk, understanding
and analyzing the course of the risk, formulating strategies and taking actions to avoid the risk
and monitoring the situation to see that the risk avoidance succeeds.

Broadly the process of risk management can comprise the following functions.

i. Risk Perception
ii. Understanding Risk Factors
iii. Risk Assessment or Quantification
iv. Risk Central Measures
v. Monitoring

2. POST SANCTION FOLLOWS UP:

Immediately after the sanction another important chapters are disbursement and recovery. It
needs proper follow up which has the following objectives:

1 To check the end use of funds, through creation of which the funds have been provided.
2 To ensure that the security charged to the hank represent what has been declared to be
both in quality and quantity.
3 To ensure compliance with terms and conditions of the advance.

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 4 To get indications through the variety of information to be collected from borrower as to
how unit is performing and to know the difficulties the borrower is facing so that
remedial action can be taken.
5 To check on a continual basis whether the credit limits sanctioned
are adequate, keeping in view the exaptation or contraction of
activity planned by the borrower and activity continues to be
available one.
Following are the points needed be taken care of alter sanction of an advance:

Getting Sanctions Accepted:

The first step after sanction must be getting sanctions accepted by the borrower. The
acceptance should be kept along with the loan documents. It helps the bank take actions
including recovery of penal interest, reduction limits or renewal there of strenghting of security
etc., in case of default.

Documentation:

Another aspect of post sanction follow up is creation of charge over securities by getting
proper documents executed from the borrower and all other parties so that power contractual
relationship comes ji h existence.

This is important from the angle of enforcement of the securities at the time of need. Precaution
like getting right kind of printed document forms with all modification getting them signed
appropriately at all places, getting them filled in all respects and then keeping them in safe
custody are required to be taken. The documents are also required to be kept alive by obtaining
the revival letters and balance confirmation, acknowledgement letters periodically.

Flow of Information:

An effective follow up system is possible only if there is regular flow of information from the
borrowers to the bank relating to the progress of enterprise and the use of the bank funds.

It can be in the form of QIS form, Balance Sheet, P & L Account, Stocks, Statements
Receivables reports etc.

This information helps the Bankers in the following ways:

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 1 To know on a continuous basis the need based credit requirement of the borrower.
2 To pick up warning signals for taking remedial action.
3 To ensure that safety of funds is not in doubt.
4 To examine that activity is being carried out on a viable basis.

Operations in the account:

The Debit and a credit summation in account reflect sale and purchase affected by the borrower.

The poor turnover in the account persistent excess drawing, frequent return of bills and cheques
or issue of cheques in round sums or in favors of parties not is line of business are some of the
danger signals indicating the impending trouble and week financial position of the borrower.
Thus operations in accounts should be viewed regularly.

Periodical Inspection:

Periodical inspection of the unit to be done to check what type of activity is going on and
movement of stocks etc., it also ensures whether proper accounting books are maintained.It also
whether insurance cover is valid and adequate in terms of value of inventory and nature of risk
involved. It anticipates any adverse features of problems, which may concern the industry.

Insurance:

Insurance of securities against theft, fire and other customary risks should be obtained. Policies
should have bank clause if in the name of borrower, Policy should preferably be kept in bank.

Periodical review/renewal:

Working capital limits should be reviewed renewed time to time so that the borrower gets
working capital limit as per his current operational level.

Debt Recovery Tribunals (DRT):

One of the main factors responsible for mounting non-performing assets in the final sector has
been the inability of banks / financial institution to enforce the security held by them on loans
gone sour.

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Prior to the passing of DRT Act the only resource available to banks / financial institutions to
cover their dues from recalcitrant borrowers when all else failed was to file a suit in civil court.
The result was that the late 80’s banks had a huge portfolio of accounts where cases were
pending in Civil Courts. It was quite common for cases to drag on interminably.

In the interim borrowers more often than not stripped their premises of all assets so that by the
time the final verdict came there was nothing left of the security that has been pledged to the
bank.

In a bid to tackle their problems the committee on financial sector reforms i.e., Narsimham
committee suggested the setting of special tribunals that would do away with civil court route.
Debt recovery tribunals they felt would do away with the costly and time consuming civil court
procedures that stymied recovery procedures since they follow a summary procedure that
expedites disposals of suit filed by banks / financial institution.

Following the passing of act in August 1993. DRT were set up at Calcutta, Delhi, Bangalore,
Ahmedabad, Jaipur and Alahabad.

Simultaneously Appellate tribunal was set up a Mumbai subsequently many DRTS have been
set up is the country. The tribunals are vested with competence to certain and decide
applications from banks/finance institution for recovery of debts due to them.

DRT consists of only one person appointed by Central Government, he must be a person who is
or has been a District Judge or is qualified to be a District Judge.

The order passed by tribunal are appealed to the appellate tribunal but no appeal can be
entertained unless the appellate deposits 75% of the amount of debt due from him as determined
by tribunal. It also consists of one person who is/has been/qualified to be judge of High Court.

Recent Policy announcement and its impact on NPA:

The RBI is nudging the big banks to intensity their actions against willful defaulters. It has
asked them to file criminal suit against them. The Central Bank is planning to set up a working
group comprising bankers and RBI officials to look into the issue. The proposed panel will
chart out a line of action required to take on these borrower. The group will try to define a
“Willful defaulter” and chart out a mechanism to recognize such defaults.

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 It will also suggest precautionary measure that needs to be taken to cut down loans to such
borrowers.

It is also considering to introducing a consolidated accounting system in the treatment of non-

performing assets of a business group. Even a default by a sister concern or subsidiary, would
be reflected on the group.

RBI Guidelines on NPA’S and ICAI Accounting Standard 9 on revenue recognition:

In view of the guidelines issued by the Reserve Bank of India (RBI), income on NPAs should
be recognized only when it is actually realized. As such, a doubt may arise as to whether the
aforesaid guidelines with respect to recognition of interest income on NPAs on realization basis
is consistent with Accounting Standard 9, “Revenue assets as NPAs seem to be based on an
assumption that the collection of interest on such assets is uncertain. Therefore complying with
AS 9, interest income is not when actually realized thereby complying with RBI guidelines as
well. In order to ensure proper appreciation of financial statements, banks should disclose the
accounting policies adopted in respect of determination of NPAs and basis on which income is
recognized With other significant accounting policies.

NPA REDUCTION INSTRUMENTS IN INDIA:

 Lok Adalats: For recovery of smaller loans, the Lok Adalat has proved a very good
agency for quick justice and settlement of dues. Lok Adalats have gained prominence
over a period of time as a forum through which the disputes among the parties are
settled through an expeditious compromise settlement.
 Debt Recovery Tribunals: Under the Banks and Financial Institution Act, 1993
popularly known as Debt Recovery Tribunal)DRT) Act, DRTs have been set up in
Delhi, Kolkata, Mumbai, Ahmedabad, Jaipur, and at some other centers to dispose of
recovery applications involving dues of Rs.10 lacs and above filed by the bankers and
financial institutions against their defaulters within a span of six months.
 Corporate Debt Restructuring: With a view to putting in place a mechanism for
timely and transparent restructuring of corporate depts. Of variable entities facing
problems, a scheme of Corporate Debt Restructuring was started in 2001 outside the
purview of Board for Industrial Finance and Reconstruction (BIFR), DRT and other
legal proceedings.
 SARFAESI: To provide a significant impetus to banks to ensure sustained recovery,

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 the Securitization and Reconstruction of Financial Assets and Enforcement of Security
Interest (SARFASI)Act was passed in 2002 and was
subsequently amended to ensure credit rights.

 Asset Reconstruction Company: With a view to increasing the options available to

banks for dealing with NPAs, guidelines were issued on sale/purchase of NPas in July
2005 and Asset Reconstruction Companies have been allowed to be set-up.
Subsequently, a few ARCs have been registered in private sector and operating as
independent commercial entities to acquire non-performing assets from any financial
entity and restructure and rehabilitate or liquidate them within a definite time frame.

A BRIEF DESCRIPTION OF ASSET CLASSIFICATION IS AS FOLLOWS:

NON-PERFORMING ASSETS IN PUBLIC SECTOR BANKS – A STUDY BY Prof. B.D.

Awasthi & Rahul Singh.

Abstract:

Non Performing Asset (NPA) is not only non-performing but also makes the banker and the
bank non-performing as it prevents or delays recycling of funds, denies income from the asset
by way of interest and erodes profit by way of provisions. In other words, NPA represents the
quantified “Credit risk”. In this paper an attempt has been made to examine the position of
NPAs in Indian Public Sector Banks (PSBs), during the recent past.

Indian banking industry has faced many challenges and risks including the menace of NPAs.
Non performing assets remained always a matter of concern for the banks in India, but it has
been in focus since the banking sector reforms were initiated in 1992. Since then, all banks
have been making efforts to contain the NPA level and they have succeeded in this task to a
large extent. At the end of March 2007, net NPAs in relation to net advances for a majority of
public sector banks were below the level of 2 per cent. Lok Adalats, Debt Recovery Tribunals
(DRTs) and scheme of Corporate Debt Restructuring have provided special thrust to banks to
contain their NPAs. In the morning past, armed with the Securitisation and Reconstruction of
Financial Assets & Enforcement of Security Interest Act, the banking industry has been able to
reduce its NPAs with full vigor. Furthermore, establishment of ‘Asset Reconstruction
Companies’ has helpd the banks to nullify their NPAs in a big way

NON-PERFORMING ASSETS IN INDIAN BANKS BY B. SATHIS KUMAR:

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Abstract:

In liberalizing economy banking and financial sector get high priority. Indian banking sector of
having a serious problem due non-performing. The financial reforms have helped largely to
clean NPA was around Rs. 52,000 crores in the year 2004. the earning capacity and profitability
of the bank are highly affected due to NPA.

The Indian banking sector is facing a serious problem of NPA. The extent of NPA is
comparatively higher in public sector banks. To improve the efficiency and profitability, the
NPA has to be scheduled. Various steps have been taken by government to reduce the NPA. It
is highly impossible to have Zero percentage NPA. But at least Indian bank can try competing
with foreign banks to maintain international standards.

RECOVERY OF THE NPAs, NEED OF THE HOUR BY Dr.(Mrs.) VALSAMMA

ANTONY:

Abstract:

The global economy is in the grip of a severe recession; the banks all over the world are on a
perilous edge, and the banks in India are no exception. Liquidity is the main concern of banks
in India today, especially in the context of the Finance Minister asking the banks to cut down
interest rates. They have started feeling the heat in spite of a strong capital base and healthy
banking practices. As our banks are tapping all possible sources and means to enhance liquidity,
recovery of bad loans from willful defaulters should be in the interest of a healthy financial
system.

With the introduction of financial sector reforms in India in the year 1991, the banking sector is
up on its wings towards growth and success, but for the growing impediment of bad debts or
Non performing Assets. A serious problem facing the banking industry in India is the exorbitant
rates of bad debts.

NPAs are not only a drag on profitability but are usually associated with high maintenance and
carrying costs. Banks are required to make provisions for these NPAs and write off those
accounts which are not recoverable, against reserves available. All these have an adverse effect
on the financial health of the banks. The Finance Ministry and the RBI are working overtime to
devise newer and solutions/ steps to stabilize the financial system in our country.

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Interpretation:

It has been observed that in the year 2013-14 the deposit were Rs. 225602.11 crores and it was
increased to Rs. 361562.73 crores in the year 2016-17. it also been observed that advances were
also increased from Rs. 225602.11 crores in the year 2013-14 to Rs. 331913.66 crores in the
year 2015-16. from the above table we can conclued that deposit and advances of ICICI are in
increasing manner.

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INDUSTRY PROFILE

&

COMPANY PROFILE

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A bank is a financial institution that accepts deposits and channels those deposits into lending
activities. Banks primarily provide financial services to customers while enriching investors.
Government restrictions on financial activities by banks vary over time and location. Banks are
important players in financial markets and offer services such as investment funds and loans. In some
countries such as Germany, banks have historically owned major stakes in industrial corporations
while in other countries such as the United States banks are prohibited from owning non-financial
companies. In Japan, banks are usually the nexus of a cross-share holding entity known as the
keiretsu. In France, bancassurance is prevalent, as most banks offer insurance services (and now real
estate services) to their clients.

Introduction

India’s banking sector is constantly growing. Since the turn of the century, there has been a noticeable
upsurge in transactions through ATMs, and also internet and mobile banking.

Following the passing of the Banking Laws (Amendment) Bill by the Indian Parliament in 2012, the
landscape of the banking industry began to change. The bill allows the Reserve Bank of India (RBI)
to make final guidelines on issuing new licenses, which could lead to a bigger number of banks in the
country. Some banks have already received licences from the government, and the RBI's new norms
will provide incentives to banks to spot bad loans and take requisite action to keep rogue borrowers in
check.

Over the next decade, the banking sector is projected to create up to two million new jobs, driven by
the efforts of the RBI and the Government of India to integrate financial services into rural areas.
Also, the traditional way of operations will slowly give way to modern technology.

Market size

Total banking assets in India touched US$ 1.8 trillion in FY13 and are anticipated to cross US$ 28.5
trillion in FY25.

Bank deposits have grown at a compound annual growth rate (CAGR) of 21.2 per cent over FY06–13.
Total deposits in FY13 were US$ 1,274.3 billion.

Total banking sector credit is anticipated to grow at a CAGR of 18.1 per cent (in terms of INR) to
reach US$ 2.4 trillion by 2017.

In FY14, private sector lenders witnessed discernable growth in credit cards and personal loan
businesses. ICICI Bank witnessed 141.6 per cent growth in personal loan disbursement in FY14, as
per a report by Emkay Global Financial Services. ICICI BANK's personal loan business also rose
49.8 per cent and its credit card business expanded by 31.1 per cent.

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Investments

Bengaluru-based software services exporter Mphasis Ltd has bagged a five-year contract from Punjab
National Bank (PNB) to set up the bank’s contact centres in Mangalore and Noida (UP). Mphasis will
provide support for all banking products and services, including deposits operations, lending services,
banking processes, internet banking, and account and card-related services. The company will also
offer services in multiple languages.

Microfinance companies have committed to setting up at least 30 million bank accounts within a year
through tie-ups with banks, as part of the Indian government’s financial inclusion plan. The
commitment was made at a meeting of representatives of 25 large microfinance companies and banks
and government representatives, which included financial services secretary Mr GS Sandhu.

Export-Import Bank of India (Exim Bank) will increase its focus on supporting project exports from
India to South Asia, Africa and Latin America, as per Mr Yaduvendra Mathur, Chairman and MD,
Exim Bank. The bank has moved up the value chain by supporting project exports so that India earns
foreign exchange. In 2012–13, Exim Bank lent support to 85 project export contracts worth Rs 24,255
crore (US$ 3.96 billion) secured by 47 companies in 23 countries.

Government Initiatives

The RBI has given banks greater flexibility to refinance current long-gestation project loans worth Rs
1,000 crore (US$ 163.42 million) and more, and has allowed partial buyout of such loans by other
financial institutions as standard practice. The earlier stipulation was that buyers should purchase at
least 50 per cent of the loan from the existing banks. Now, they get as low as 25 per cent of the loan
value and the loan will still be treated as ‘standard’.

The RBI has also relaxed norms for mortgage guarantee companies (MGC) enabling these firms to
use contingency reserves to cover for the losses suffered by the mortgage guarantee holders, without
the approval of the apex bank. However, such a measure can only be initiated if there is no single
option left to recoup the losses.

SBI is planning to launch a contact-less or tap-and-go card facility to make payments in India.
Contact-less payment is a technology that has been adopted in several countries, including Australia,
Canada and the UK, where customers can simply tap or wave their card over a reader at a point-of-
sale terminal, which reads the card and allows transactions.

SBI and its five associate banks also plan to empower account holders at the bottom of the social
pyramid with a customer call facility. The proposed facility will help customers get an update on
available balance, last five transactions and cheque book request on their mobile phones.

20
Road Ahead

India is yet to tap into the potential of mobile banking and digital financial services. Forty-seven per
cent of the populace have bank accounts, of which half lie dormant due to reliance on cash
transactions, as per a report. Still, the industry holds a lot of promise.

India's banking sector could become the fifth largest banking sector in the world by 2020 and the third
largest by 2025. These days, Indian banks are turning their focus to servicing clients and enhancing
their technology infrastructure, which can help improve customer experience as well as give banks a
competitive edge.

Exchange Rate Used: INR 1 = US$ 0.0163 as on October 28, 2015

The level of government regulation of the banking industry varies widely, with countries such as
Iceland, having relatively light regulation of the banking sector, and countries such as China having a
wide variety of regulations but no systematic process that can be followed typical of a communist
system.

The oldest bank still in existence is Monte dei Paschi di Siena, headquartered in Siena, Italy, which
has been operating continuously since 1472.

History

Origin of the word

The name bank derives from the Italian word banco "desk/bench", used during the Renaissance by
Jewish Florentine bankers, who used to make their transactions above a desk covered by a green
tablecloth. However, there are traces of banking activity even in ancient times, which indicates that
the word 'bank' might not necessarily come from the word 'banco'.

In fact, the word traces its origins back to the Ancient Roman Empire, where moneylenders would set
up their stalls in the middle of enclosed courtyards called macella on a long bench called a bancu,
from which the words banco and bank are derived. As a moneychanger, the merchant at the bancu did
not so much invest money as merely convert the foreign currency into the only legal tender in Rome
—that of the Imperial Mint.

The earliest evidence of money-changing activity is depicted on a silver drachm coin from ancient
Hellenic colony Trapezus on the Black Sea, modern Trabzon, c. 350–325 BC, presented in the British
Museum in London. The coin shows a banker's table (trapeza) laden with coins, a pun on the name of
the city.

21
In fact, even today in Modern Greek the word Trapeza (Τράπεζα) means both a table and a bank.

Traditional banking activities

Banks act as payment agents by conducting checking or current accounts for customers, paying
cheques drawn by customers on the bank, and collecting cheques deposited to customers' current
accounts. Banks also enable customer payments via other payment methods such as telegraphic
transfer, EFTPOS, and ATM.

Banks borrow money by accepting funds deposited on current accounts, by accepting term deposits,
and by issuing debt securities such as banknotes and bonds. Banks lend money by making advances to
customers on current accounts, by making installment loans, and by investing in marketable debt
securities and other forms of money lending.

Banks provide almost all payment services, and a bank account is considered indispensable by most
businesses, individuals and governments. Non-banks that provide payment services such as remittance
companies are not normally considered an adequate substitute for having a bank account.

Banks borrow most funds from households and non-financial businesses, and lend most funds to
households and non-financial businesses, but non-bank lenders provide a significant and in many
cases adequate substitute for bank loans, and money market funds, cash management trusts and other
non-bank financial institutions in many cases provide an adequate substitute to banks for lending
savings to.

Entry regulation

Currently in most jurisdictions commercial banks are regulated by government entities and require a
special bank licence to operate.

Usually the definition of the business of banking for the purposes of regulation is extended to include
acceptance of deposits, even if they are not repayable to the customer's order—although money
lending, by itself, is generally not included in the definition.

Unlike most other regulated industries, the regulator is typically also a participant in the market, i.e. a
government-owned (central) bank. Central banks also typically have a monopoly on the business of
issuing banknotes. However, in some countries this is not the case. In the UK, for example, the
Financial Services Authority licences banks, and some commercial banks (such as the Bank of
Scotland) issue their own banknotes in addition to those issued by the Bank of England, the UK
government's central bank.

22
Accounting for bank accounts

Bank statements are accounting records produced by banks under the various accounting standards of
the world. Under GAAP and IFRS there are two kinds of accounts: debit and credit. Credit accounts
are Revenue, Equity and Liabilities. Debit Accounts are Assets and Expenses. This means you credit a
credit account to increase its balance, and you debit a debit account to decrease its balance.

This also means you debit your savings account every time you deposit money into it (and the account
is normally in deficit), while you credit your credit card account every time you spend money from it
(and the account is normally in credit).

However, if you read your bank statement, it will say the opposite—that you credit your account
when you deposit money, and you debit it when you withdraw funds. If you have cash in your
account, you have a positive (or credit) balance; if you are overdrawn, you have a negative (or deficit)
balance.

The reason for this is that the bank, and not you, has produced the bank statement. Your savings might
be your assets, but the bank's liability, so they are credit accounts (which should have a positive
balance). Conversely, your loans are your liabilities but the bank's assets, so they are debit accounts
(which should also have a positive balance).

Where bank transactions, balances, credits and debits are discussed below, they are done so from the
viewpoint of the account holder—which is traditionally what most people are used to seeing.

Economic functions

1. issue of money, in the form of banknotes and current accounts subject to cheque or payment
at the customer's order. These claims on banks can act as money because they are negotiable
and/or repayable on demand, and hence valued at par. They are effectively transferable by
mere delivery, in the case of banknotes, or by drawing a cheque that the payee may bank or
cash.
2. netting and settlement of payments – banks act as both collection and paying agents for
customers, participating in interbank clearing and settlement systems to collect, present, be
presented with, and pay payment instruments. This enables banks to economise on reserves
held for settlement of payments, since inward and outward payments offset each other. It also
enables the offsetting of payment flows between geographical areas, reducing the cost of
settlement between them.

23
 3. credit intermediation – banks borrow and lend back-to-back on their own account as middle
men.
4. credit quality improvement – banks lend money to ordinary commercial and personal
borrowers (ordinary credit quality), but are high quality borrowers. The improvement comes
from diversification of the bank's assets and capital which provides a buffer to absorb losses
without defaulting on its obligations. However, banknotes and deposits are generally
unsecured; if the bank gets into difficulty and pledges assets as security, to raise the funding it
needs to continue to operate, this puts the note holders and depositors in an economically
subordinated position.
5. maturity transformation – banks borrow more on demand debt and short term debt, but
provide more long term loans. In other words, they borrow short and lend long. With a
stronger credit quality than most other borrowers, banks can do this by aggregating issues
(e.g. accepting deposits and issuing banknotes) and redemptions (e.g. withdrawals and
redemptions of banknotes), maintaining reserves of cash, investing in marketable securities
that can be readily converted to cash if needed, and raising replacement funding as needed
from various sources (e.g. wholesale cash markets and securities markets).

Law of banking

Banking law is based on a contractual analysis of the relationship between the bank (defined above)
and the customer—defined as any entity for which the bank agrees to conduct an account.

The law implies rights and obligations into this relationship as follows:

1. The bank account balance is the financial position between the bank and the customer: when
the account is in credit, the bank owes the balance to the customer; when the account is
overdrawn, the customer owes the balance to the bank.
2. The bank agrees to pay the customer's cheques up to the amount standing to the credit of the
customer's account, plus any agreed overdraft limit.
3. The bank may not pay from the customer's account without a mandate from the customer, e.g.
a cheque drawn by the customer.
4. The bank agrees to promptly collect the cheques deposited to the customer's account as the
customer's agent, and to credit the proceeds to the customer's account.
5. The bank has a right to combine the customer's accounts, since each account is just an aspect
of the same credit relationship.
6. The bank has a lien on cheques deposited to the customer's account, to the extent that the
customer is indebted to the bank.

24
 7. The bank must not disclose details of transactions through the customer's account—unless the
customer consents, there is a public duty to disclose, the bank's interests require it, or the law
demands it.
8. The bank must not close a customer's account without reasonable notice, since cheques are
outstanding in the ordinary course of business for several days.

These implied contractual terms may be modified by express agreement between the customer and the
bank. The statutes and regulations in force within a particular jurisdiction may also modify the above
terms and/or create new rights, obligations or limitations relevant to the bank-customer relationship.

Some types of financial institution, such as building societies and credit unions, may be partly or
wholly exempt from bank licence requirements, and therefore regulated under separate rules.

The requirements for the issue of a bank licence vary between jurisdictions but typically include:

1. Minimum capital
2. Minimum capital ratio
3. 'Fit and Proper' requirements for the bank's controllers, owners, directors, and/or senior
officers
4. Approval of the bank's business plan as being sufficiently prudent and plausible.

Types of banks

Banks' activities can be divided into retail banking, dealing directly with individuals and small
businesses; business banking, providing services to mid-market business; corporate banking, directed
at large business entities; private banking, providing wealth management services to high net worth
individuals and families; and investment banking, relating to activities on the financial markets. Most
banks are profit-making, private enterprises. However, some are owned by government, or are non-
profit organizations.

Central banks are normally government-owned and charged with quasi-regulatory responsibilities,
such as supervising commercial banks, or controlling the cash interest rate. They generally provide
liquidity to the banking system and act as the lender of last resort in event of a crisis.

Types of retail banks

 Commercial bank: the term used for a normal bank to distinguish it from an investment bank.
After the Great Depression, the U.S. Congress required that banks only engage in banking
activities, whereas investment banks were limited to capital market activities. Since the two

25
 no longer have to be under separate ownership, some use the term "commercial bank" to refer
to a bank or a division of a bank that mostly deals with deposits and loans from corporations
or large businesses.
 Community Banks: locally operated financial institutions that empower employees to make
local decisions to serve their customers and the partners.
 Community development banks: regulated banks that provide financial services and credit to
under-served markets or populations.
 Postal savings banks: savings banks associated with national postal systems.
 Private banks: banks that manage the assets of high net worth individuals.
 Offshore banks: banks located in jurisdictions with low taxation and regulation. Many
offshore banks are essentially private banks.
 Savings bank: in Europe, savings banks take their roots in the 19th or sometimes even 18th
century. Their original objective was to provide easily accessible savings products to all strata
of the population. In some countries, savings banks were created on public initiative; in
others, socially committed individuals created foundations to put in place the necessary
infrastructure. Nowadays, European savings banks have kept their focus on retail banking:
payments, savings products, credits and insurances for individuals or small and medium-sized
enterprises. Apart from this retail focus, they also differ from commercial banks by their
broadly decentralised distribution network, providing local and regional outreach—and by
their socially responsible approach to business and society.
 Building societies and Landesbanks: institutions that conduct retail banking.
 Ethical banks: banks that prioritize the transparency of all operations and make only what
they consider to be socially-responsible investments.
 Islamic banks: Banks that transact according to Islamic principles.

Types of investment banks

 Investment banks "underwrite" (guarantee the sale of) stock and bond issues, trade for their
own accounts, make markets, and advise corporations on capital market activities such as
mergers and acquisitions.
 Merchant banks were traditionally banks which engaged in trade finance. The modern
definition, however, refers to banks which provide capital to firms in the form of shares rather
than loans. Unlike venture capital firms, they tend not to invest in new companies.

Both combined

 Universal banks, more commonly known as financial services companies, engage in several
of these activities. These big banks are very diversified groups that, among other services,

26
 also distribute insurance— hence the term bancassurance, a portmanteau word combining
"banque or bank" and "assurance", signifying that both banking and insurance are provided by
the same corporate entity.

Other types of banks

 Islamic banks adhere to the concepts of Islamic law. This form of banking revolves around
several well-established principles based on Islamic canons. All banking activities must avoid
interest, a concept that is forbidden in Islam. Instead, the bank earns profit ( markup) and fees
on the financing facilities that it extends to customers.

COMPANY PROFILE

ICICI Bank is India's largest private sector bank with total assets of Rs. 5,946.42 billion (US$
99 billion) at March 31, 2015 and profit after tax Rs. 98.10 billion (US$ 1,637 million) for
the year ended March 31, 2015.ICICI Bank currently has a network of 3,839 Branches and
11,943 ATM's across India.

History

1955

The Industrial Credit and Investment Corporation of India Limited (ICICI) incorporated at
the initiative of the World Bank, the Government of India and representatives of Indian
industry, with the objective of creating a development financial institution for providing
medium-term and long-term project financing to Indian businesses. Mr.A.Ramaswami
Mudaliar elected as the first Chairman of ICICI Limited.
ICICI emerges as the major source of foreign currency loans to Indian industry. Besides
funding from the World Bank and other multi-lateral agencies, ICICI was also among the
first Indian companies to raise funds from international markets.

ICICI Bank was originally promoted in 1994 by ICICI Limited, an Indian financial
institution, and was its wholly-owned subsidiary. ICICI's shareholding in ICICI Bank was
reduced to 46% through a public offering of shares in India in fiscal 1998, an equity offering

27
in the form of ADRs listed on the NYSE in fiscal 2000, ICICI Bank's acquisition of Bank of
Madura Limited in an all-stock amalgamation in fiscal 2001, and secondary market sales by
ICICI to institutional investors in fiscal 2001 and fiscal 2002. ICICI was formed in 1955 at
the initiative of the World Bank, the Government of India and representatives of Indian
industry. The principal objective was to create a development financial institution for
providing medium-term and long-term project financing to Indian businesses.

In the 1990s, ICICI transformed its business from a development financial institution offering
only project finance to a diversified financial services group offering a wide variety of
products and services, both directly and through a number of subsidiaries and affiliates like
ICICI Bank. In 1999, ICICI become the first Indian company and the first bank or financial
institution from non-Japan Asia to be listed on the NYSE.

After consideration of various corporate structuring alternatives in the context of the

emerging competitive scenario in the Indian banking industry, and the move towards
universal banking, the managements of ICICI and ICICI Bank formed the view that the
merger of ICICI with ICICI Bank would be the optimal strategic alternative for both entities,
and would create the optimal legal structure for the ICICI group's universal banking strategy.
The merger would enhance value for ICICI shareholders through the merged entity's access
to low-cost deposits, greater opportunities for earning fee-based income and the ability to
participate in the payments system and provide transaction-banking services. The merger
would enhance value for ICICI Bank shareholders through a large capital base and scale of
operations, seamless access to ICICI's strong corporate relationships built up over five
decades, entry into new business segments, higher market share in various business segments,
particularly fee-based services, and access to the vast talent pool of ICICI and its subsidiaries.

 In October 2001, the Boards of Directors of ICICI and ICICI Bank approved the merger of
ICICI and two of its wholly-owned retail finance subsidiaries, ICICI Personal Financial
Services Limited and ICICI Capital Services Limited, with ICICI Bank. The merger was
approved by shareholders of ICICI and ICICI Bank in January 2002, by the High Court of
Gujarat at Ahmedabad in March 2002, and by the High Court of Judicature at Mumbai and
the Reserve Bank of India in April 2002. Consequent to the merger, the ICICI group's

28
financing and banking operations, both wholesale and retail, have been integrated in a single
entity.

ICICI Group Companies

ICICI Group ICICI Prudential AMC & Trust

http://www.icicigroupcompanies.com http://www.icicipruamc.com

   

ICICI Prudential Life Insurance Company ICICI Venture

http://www.iciciprulife.com/public/default. http://www.iciciventure.com
htm
 
 
ICICI Direct
ICICI Securities http://www.icicidirect.com
http://www.icicisecurities.com
 
 
ICICI Foundation
ICICI Lombard General Insurance http://www.icicifoundation.org
Company
 
http://www.icicilombard.com
Disha Financial Counselling
 
http://www.icicifoundation.org

 Board of Directors

Mr. K. V. Kamath, Chairman Mr. Homi R. Khusrokhan

.............................................. ..............................................

Mr. Dileep Choksi Mr. M.S. Ramachandran

.............................................. ..............................................

29
Dr. Tushaar Shah

..............................................

Mr. V. K. Sharma

..............................................

Mr. V. Sridar

..............................................

Mr. Alok Tandon

Ms. Chanda Kochhar,

Managing Director & CEO

...........................................

Mr. N. S. Kannan,

Executive Director

...........................................

Mr. K. Ramkumar,

Executive Director

...........................................

Mr. Rajiv Sabharwal,

Executive Director

30
 Awards – 2019

ICICI Bank

 Ms. Chanda Kochhar received an honorary Doctor of Laws from Carleton University,
Canada. The university conferred this award on Ms. Kochhar in recognition of her pioneering
work in the financial sector, effective leadership in a time of economic crisis and support for
engaged business practices.
 Ms Chanda Kochhar featured in The Telegraph (UK) list of '11 most important
women in finance'.
 ICICI Bank has been recognised as one of the 'Top Companies for Leaders' in India in
a study conducted by Aon Hewitt.
 IDRBT has given awards to ICICI Bank in the categories of 'Social Media and Mobile
Banking' and' Business Intelligence Initiatives'.
 ICICI Bank won the award for the Best Bank - Global Business Development (Private
Sector) in the Dun & Bradstreet - Polaris Financial Technology Banking Awards 2015.
 ICICI Bank was awarded the Certificate of Recognition as one of the Top 5
Companies in Corporate Governance in the 14th ICSI (The Institute of Company Secretaries
of India) National Awards for Corporate Governance.
 ICICI Bank has been honoured as The Best Service Provider - Risk Management,
India at The Asset Triple A Transaction Banking, Treasury, Trade and Risk Management
Awards 2015.
 Mr Rakesh Jha has been ranked as the Best CFO in India at the 14th Annual Finance
Asia's Best Managed Companies Poll.
 ICICI Bank has won The Corporate Treasurer Awards 2013 in the categories of 'Best
Cash Management Bank in India' & 'Best Trade Finance Bank in India'.
 ICICI Bank has been awarded the 'Best Retail Bank in India', 'Best Microfinance
Business' and Best Retail Banking Branch Innovation' under the 'Excellence in Retail
Financial Services awards 2015' by The Asian Banker.
 Ms Chanda Kochhar, MD & CEO, ICICI Bank, has been named among Fortune's 50
most powerful women in business for the fourth consecutive year.

31
 Ms. Chanda Kochhar, MD and CEO received the 'Mumbai Women Of The Decade'
award by ASSOCHAM.

 ICICI Bank, India’s largest private sector bank, today announced the launch of India’s only
credit card with a unique transparent design and a distinctive look. The ‘ICICI Bank Coral
American Express Credit Card’ is the latest addition to the Bank’s exclusive ‘Gemstone
Collection’ of credit cards.

Speaking at the launch, Mr. Rajiv Sabharwal, Executive Director, ICICI Bank said, "At
ICICI Bank, it is our constant endeavour to deliver innovative, powerful and distinctive value
propositions to our discerning customers. We are delighted to launch the ‘ICICI Bank Coral
American Express Credit Card’, the only card in the country with a youthful, transparent
design. Aimed at providing significant lifestyle benefits, this card re-affirms our commitment
to bring forth innovative services to our customers. We are also introducing a host of exciting
privileges including an introductory extended credit period offer and bonus reward points on
online transactions. We believe this card will be yet another compelling addition to our
Gemstone collection of credit cards."

Ms. Siew Choo Ng, Senior Vice President, Head of Global Network Partnerships, Asia,
American Express International, Inc. said, "We are delighted to have further strengthened
our long and cherished relationship with ICICI Bank with the launch of the new ICICI Bank
Coral American Express Credit Card. Designed to appeal to value seeking customers, the
Card reinforces our consistent endeavor to provide differentiated products and services to our
customers. The Card offers a wide array of exclusive privileges and features including
additional PAYBACK points on online spend and an innovative transparent design. At
American Express, we always strive to work closely with our partners to develop the most
relevant and compelling products for our valued card members."

Mr. Sanjay Rishi, President, South Asia, American Express, said, “This launch marks a
further strengthening of the relationship between ICICI Bank and American Express. We
already partner with ICICI Bank on customer loyalty programs, insurance services, retail

32
 banking services as well as initiatives to expand card accepting merchants. The launch of the
ICICI Bank Coral American Express Card combines the strengths and capabilities of both
organizations to offer an exciting new payment choice to customers.

The ICICI Bank Coral American Express® Credit Card offers a wide range of attractive
benefits to its card members:

 Extended Credit Period; a unique proposition offering card members ability to carry
over the retail purchase balances in first two billing statements by simply paying the
minimum amount due. No interest shall be charged in such cases and the total amount due
shall be payable as per the third billing statement. TnC apply, for complete details please
visit www.icicibank.com.
 4 PAYBACK points per Rs.100 spent on dining, groceries and at supermarkets, 3
PAYBACK points per Rs.100 of online spends and 2 PAYBACK points per Rs.100 on other
spends
 Complimentary movie tickets with 'buy one get one free' offer
on www.bookmyshow.com
 Complimentary visits to Altitude lounges at Mumbai and Delhi airports
 Minimum 15% discount on dining bills at leading restaurants across India with the
ICICI Bank ‘Culinary Treats’ programme
 No fuel surcharge on fuel transactions at HPCL fuel stations

OVERVIEW ICICI Group

ICICI Group offers a wide range of banking products and financial services to corporate and
retail customers through a variety of delivery channels and through its specialised group
companies and subsidiaries in the areas of personal banking, investment banking, life and
general insurance, venture capital and asset management. With a strong customer focus, the
ICICI Group Companies have maintained and enhanced their leadership positions in their
respective sectors.

ICICI Bank is India's second-largest bank with total assets of Rs. 4,736.47 billion (US$ 93
billion) at March 31, 2012 and profit after tax Rs. 64.65 billion (US$ 1,271 million) for the

33
year ended March 31, 2012. The Bank has a network of 2,791 branches and 10,021 ATMs in
India, and has a presence in 19 countries, including India.

ICICI Prudential Life Insurance is a joint venture between ICICI Bank, a premier financial
powerhouse, and Prudential plc, a leading international financial services group
headquartered in the United Kingdom. ICICI Prudential Life was amongst the first private
sector insurance companies to begin operations in December 2000 after receiving approval
from Insurance Regulatory Development Authority (IRDA). ICICI Prudential Life's capital
stands at Rs. 47.91 billion (as of March 31, 2012) with ICICI Bank and Prudential plc
holding 74% and 26% stake respectively. For FY 2012, the company garnered Rs.140.22
billion of total premiums and has underwritten over 13 million policies since inception. The
company has assets held over Rs. 707.71 billion as on March 31, 2012.

ICICI Lombard General Insurance Company, is a joint venture between ICICI Bank Limited,
India's second largest bank with consolidated total assets of over USD 91 billion at March 31,
2012 and Fairfax Financial Holdings Limited, a Canada based USD 30 billion diversified
financial services company engaged in general insurance, reinsurance, insurance claims
management and investment management. ICICI Lombard GIC Ltd. is the largest private
sector general insurance company in India with a Gross Written Premium (GWP) of Rs.
5,358 crore for the year ended March 31, 2012. The company issued over 76 lakh policies
and settled over 44 lakh claims and has a claim disposal ratio of 99% (percentage of claims
settled against claims reported) as on March 31, 2012. 

ICICI Securities Ltd is the largest integrated securities firm covering the needs of corporate
and retail customers through investment banking, institutional broking, retail broking and
financial product distribution businesses. Among the many awards that ICICI Securities has
won, the noteworthy awards for 2012 were: Asiamoney `Best Domestic Equity House for
2012; 'BSE IPF D&B Equity Broking Awards 2012' under two categories:- Best Equity
Broking House - Cash Segment and Largest E-Broking House; the Chief Learning Officer
Award from World HRD Congress for Innovation in Learning category. IDG India's CIO
magazine has recognized ICICI Securities as a recipient of CIO 100 award in 2009, 2010,
2011 and 2012. I-Sec won this awards 4 times in a row for which the CIO Hall of Fame
award was additionally conferred in 2012.

34
ICICI Securities Primary Dealership Limited (‘I-Sec PD’) is the largest primary dealer in
Government Securities. It is an acknowledged leader in the Indian fixed income and money
markets, with a strong franchise across the spectrum of interest rate products and services -
institutional sales and trading, resource mobilisation, portfolio management services and
research. One of the first entities to be granted primary dealership license by RBI, I-Sec PD
has made pioneering contributions since inception to debt market development in India. I-Sec
PD is also credited with pioneering debt market research in India. It is one of the largest
portfolio managers in the country and amongst PDs, managing the largest AUM under
discretionary portfolio management.
I-Sec PD’s leadership position and research expertise have been consistently recognised by
domestic and international agencies. In recognition of our performance in the Fixed Income
market, we have received the following awards:

 “Best Domestic Bond House” in India - 2007, 2005, 2004, 2002 by Asia Money
 “Best Bond House” - 2009, 2007, 2006, 2005, 2004, 2001 by Finance Asia
 “Best Domestic Bond House” – 2009 by The Asset Magazine’s annual Triple A
Country Awards
 Ranked volume leader - by Greenwich Associates in 2010 Asian Fixed-Income
Investors Study. Ranked 5th in ‘Domestic Currency Asian Credit’ with market share
of 4.5%, Only Domestic entity to be ranked.
 “Best Debt House in India” – 2012 by EUROMONEY

ICICI Prudential Asset Management is the third largest mutual fund with average asset under
management of Rs. 688.16 billion and a market share ( mutual fund ) of 10.34% as on March
31, 2012. The Company manages a comprehensive range of mutual fund schemes and
portfolio management services to meet the varying investment needs of its investors
through117 branches and 196 CAMS official point of transaction acceptance spread across
the country. 

ICICI Venture is one of the largest and most successful alternative asset managers in India
with funds under management of over US$ 2 billion. It has been a pioneer in the Indian
alternative asset industry since its establishment in 1988, having managed several funds

35
across various asset classes over multiple economic cycles. ICICI Venture is a wholly owned
subsidiary of ICICI Bank

GROUP PHILOSOPHY

As India transforms into a key player in the global economic arena, multiple opportunities for
the financial services sector have emerged. We, at ICICI Group, seek to partner the country's
growth and globalization through the delivery of world-class financial services across all
cross-sections of society.

From providing project and working capital finance to the buoyant manufacturing and
infrastructure sectors, meeting the foreign investment and treasury requirements of the Indian
corporate with increasing levels of international engagement, servicing the India linked needs
of the growing Indian diaspora, being a catalyst to the consumer finance story to serving the
financially under-served segments of the society, our technology empowered solutions and
distribution network have helped us touch millions of lives.

Vision:

To be the leading provider of financial services in India and a major global bank.

Mission:

We will leverage our people, technology, speed and financial capital to:

 be the banker of first choice for our customers by delivering high quality, world-class
products and services.
 expand the frontiers of our business globally.
 play a proactive role in the full realisation of India’s potential.
 maintain a healthy financial profile and diversify our earnings across businesses and
geographies.
 maintain high standards of governance and ethics.
 contribute positively to the various countries and markets in which we operate.
 create value for our stakeholders.

Towards Sustainable Development

36
As India's fastest growing financial services conglomerate, with deep moorings in the Indian
economy for over five decades, ICICI Group of companies have endeavored to contribute to
address the challenges posed to the community in multiple ways. 

1) ICICI Foundation for Inclusive Growth: ICICI Foundation for Inclusive Growth (ICICI
Foundation) was founded by the ICICI Group in early 2008 to carry forward and build upon
its legacy of promoting inclusive growth. ICICI Foundation works within public systems and
specialised grassroots organisations to support developmental work in four identified focus
areas. We are committed to investing in long-term efforts to support inclusive growth through
effective interventions.  

2) Disha Counselling: Disha Financial Counselling services are free to all in areas like
financial education, credit counselling and debt management. 

3) Technology Finance Group: TFG's programmes are designed to assist industry and

institutions to undertake collaborative R&D and technology development projects. 

4) Read to Lead campaign: ICICI Bank has pledged to educate 1,00,000 children through
the 'Read to Lead initiative. Because education today means a better life tomorrow. 

5) Go Green. Each one for a better earth: ICICI Bank, is a responsible corporate citizen
and believes that every small 'green' step today would go a long way in building a greener
future and that each one of us can work towards a better earth.

Go Green' is an organisation wide initiative that moves beyond moving ourselves, our
processes and our customers to cost efficient automated channels to building awareness and
consciousness of our environment, our nation and our society.

PERSONAL BANKING

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Deposits

ICICI Bank offers wide variety of Deposit Products to suit your requirements. Convenience
of networked branches/ ATMs and facility of E-channels like Internet and Mobile Banking,
Select any of our deposit products and provide your details online and our representative will
contact you.

Loans

ICICI Bank offers wide variety of Loans Products to suit your requirements. Coupled with
convenience of networked branches/ ATMs and facility of E-channels like Internet and
Mobile Banking, ICICI Bank brings banking at your doorstep. Select any of our loan product
and provide your details online and our representative will contact you for getting loans.

Cards

ICICI Bank offers a variety of cards to suit your different transactional needs. Our range
includes Credit Cards, Debit Cards and Prepaid cards. These cards offer you convenience for
your financial transactions like cash withdrawal, shopping and travel. These cards are widely
accepted both in India and abroad. Read on for details and features of each.

Wealth Management

Wealth is the result of a recognized opportunity. We understand this and we work with you to
plan and manage your financial opportunities prudently. Not just that, we also extend a host
of services so you can remain focused on immediate objectives while we take care of all your
wealth management requirements.

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