A PROJECT REPORT ON

“PERFORMANCE APPRAISAL’’

WITH REFERENCE TO
HDFC BANK

A report submitted in partial fulfillment of the requirement project for the award degree of

BACHELORS OF BUSINESS ADMINISTRATION

Submitted by

PRIYANSHA WILLIAM

(Regd.No.117127007035)

Under esteemed guidance of

Dr.B.MAHESH

Professor
 (Affiliated to Andhra University)

VISAKHAPATNAM

CERTIFICATE
This is to certify that the project work entitled “PERFORMANCE APPRAISAL” with
reference to “ HDFC BANK” being submitted by PRIYANSHA WILLIAM, Regd.No:
117127007035 in partial fulfillment for the award of degree of Bachelor of Business
Administration UNITY DEGREE COLLEGE, VISAKHAPATNAM is a bonafied work
carried out by her under my guidance and supervision.
 DECLARATION

I hereby declare that the work presented in this dissertation entitled “A STUDY ON
PERFORMANCE APPRAISAL” with reference to “HDFC BANK ” submitted to the UNITY
DEGREE COLLEGE, VISAKHAPATNAM is a bonafied work done by me in the partial
fulfillment for the award of degree Bachelors of Business Administration.

This project report is my own and is not submitted to any other university or institution for award
of any degree.

PRIYANSHA WILLIAM

PLACE:

DATE:

HEAD OF DEPARTMENT PROJECT GUIDE EXTERNAL EXAMINER

 ACKNOWLEDGEMENT

I would like to express my deep sense of gratitude to those who have assisted, guided and
encouraged me in carrying out my dissertation successfully.

I would like to express my deepest gratitude to our correspondent Mr. K. SANDEEP and
director Ms. MARTINA D’CRUZ.

I would express my deepest gratitude to my guide lecturer Dr.B.MAHESH in business

administration for his valuable support and guidance, inspiration for my report completion. I also
express my sincere thanks to the staff members of the department of business administration who
co-operated for the successful completion of my project work.

I would also like to thank the manager and staff members of HDFC BANK for providing me
with the necessary information required for my project work.

PRIYANSHA WILLIAM
 INDEX
S.no Title Page no.
Chapter 1 Introduction
Objective of the study
Need for study
Scope of the study
Mythology of the study
Limitations of the study

Chapter 2 Industrial profile

Company profile
Chapter 3 Theoretical framework
of the study
Chapter 4 Data analysis

Chapter 5 Summary
Findings
Suggestions
Conclusion
Annexure
Bibliography
1.1 INTRODUCTION

The Housing Development Finance Corporation Limited (HDFC) was amongst the first to
receive an 'in principle' approval from the Reserve Bank of India (RBI) to set up a bank in the private
sector, as part of the RBI's liberalization of the Indian Banking Industry in 1994. The bank was
incorporated in August 1994 in the name of 'HDFC Bank Limited', with its registered office in Mumbai,
India. HDFC Bank commenced operations as a Scheduled Commercial Bank in January 1995. HDFC is
India's premier housing finance company and enjoys an impeccable track record in India as well as in
international markets. Since its inception in 1977, the Corporation has maintained a consistent and
healthy growth in its operations to remain the market leader in mortgages. Its outstanding loan portfolio
covers well over a million dwelling units. HDFC has developed significant expertise in retail mortgage
loans to different market segments and also has a large corporate client base for its housing related
credit facilities. With its experience in the financial markets, a strong market reputation, large
shareholder base and unique consumer franchise, HDFC was ideally positioned to promote a bank in the
Indian environment.

HDFC Bank began operations in 1995 with a simple mission: to be a “World Class Indian Bank.” We
realized that only a single minded focus on product quality and service excellence would help us get
there. Today, we are proud to say that we are well on our way towards that goal.

HDFC Bank Limited (the Bank) is an India-based banking company engaged in providing a range of
banking and financial services, including commercial banking and treasury operations. The Bank has a
network of 1412 branches and 3295 automated teller machines (ATMs) in 528 cities and total
employees is 52687.
1.2 Objectives of the Study

The current study was undertaken to achieve the following stated objectives:

1. To analyze awareness among customers using Net banking service.

2. To know about the Net Banking service provided by HDFC Bank.

3. To know the cause why customers are using or not using Net banking
service.

4. To the confidence of the customers of HDFC Bank in using these services.

5. To study the popularity of the Net banking service among the customers of
HDFC Bank.
1.3 NEED FOR THE STUDY

After conducting a review of researches done by various professionals a

gap have been identified. The researchers had studied the aspects of

internet banking, its introduction, its development, adoption by the

customers, consumers perception about this service, its success

and security related issues. But a very few researchers had studied the

net banking service with respect to the HDFC Bank. This gap had been

identified and it handled to the present research being undertaken.

.
1.4 SCOPE OF THE STUDY

HDFC BANK offer a bunch of products and service to meet the

every need of the people. The company cares for both, individuals
as well as corporate and small and medium enterprise. For
individual, the company has a range accounts, investment and
pension scheme, different types of loans and cards that assist the
customer. The customer can choose the suitable one from a range of
product which will suit their life – stage and needs. For organization
the company has a host of customized solutions that range from
funded service, Non-funded service, value addition service, mutual
fund etc. These affordable plans apart from providing long term
value to the employees help in enhancing goodwill of the company.
 1.5 METHODOLOGY OF THE STUDY

Research is a common parlance which refers to search for knowledge. It is a procedure of logical

and systematic application of the fundamentals of science to the general and overall questions of

a study and scientific technique, which provide precise tools, specific procedures, and technical

rather philosophical means for getting and ordering the data prior to their logical analysis and

manipulating different type of research designs is available depending upon the nature of

research project, availability of manpower and circumstances.

1.1 RESEARCH DESIGN- A research design is the arrangement of conditions for collection
and analysis of data in a manner that aims to combine relevance to the research purpose with
economy in procedure. In fact, the research design is the conceptual structure within which
research is conducted. This research was descriptive in nature.

1.2. Descriptive research: The research undertaken is a descriptive research as it was concerned
with specific predictions, with narration of facts and characteristics concerning net banking
service provided by HDFC Bank.

1.3. SAMPLING DESIGN-The following factors have been decided within the scope of sample
Design.

1.4. Universe of study: Universe of the study means all the persons who are the customers of
HDFC Bank in the world.

Theoretical: It covered all the individuals who are the customers of HDFC Bank in the world.

Accessible: It covered all the individuals who are the customers of HDFC Bank in India who are

within our reach. In this study accessible population was customers of HDFC Bank in India.
1.6 LIMITATIONS OF THE STUDY

The following were the limitations of the study:

1. Non representative sample: In this research project a sample survey was

conducted. A sample of 100 respondents was selected. So such sample size cannot
be said to be the true representative of the universe
.

2. Shortage of time: The time period of study was very limited. It is very
difficult to have in detail study on project work due to limited time period. The
period of 4 to 6 weeks is not enough for the proper study of the project.

3. Inadequate data: The data provided was not up to the mark due to which we
faced problems in our research.

4. Lack of scientific method: The lack of scientific training in methodology

of research was great impediment in our research program, which led to the delay
of research.

5. Cost Factor: It was not possible to conduct extensive research due to paucity
of fund.
 CHAPTER 2

INDUSTRY PROFILE

A bank is a financial institution that provides banking and other financial services to their
customers. A bank is generally understood as an institution which provides fundamental banking
services such as accepting deposits and providing loans. There are also non-banking institutions that
provide certain banking services without meeting the legal Banks are a subset of the financial
services industry. A banking system also referred as a system provided by the bank which offers
cash management services for customers, reporting the transactions of their accounts and
portfolios, throughout the day. The banking system in India, should not only be hassle free but it
should be able to meet the new challenges posed by the technology and any other external and
internal factors. For the past three decades, India’s banking system has several outstanding
achievements to its credit. The Banks are the main participants of the financial system in India.
Before the establishment of banks, the financial activities were handled by money lenders and
individuals. At that time the interest rates were very high. Again there were no security of public
savings and no uniformity regarding loans. So as to overcome such problems the organized banking
sector was established, which was fully regulated by the government. The organized banking sector
works within the financial system to provide loans, accept deposits and provide other services to
their customers. The Banking sector offers several facilities and opportunities to their customers. All
the banks safeguards the money and valuables and provide loans, credit, and payment services,
such as checking accounts, money orders, and cashiers’ cheque. The banks also offer investment
and insurance products. As a variety of models for cooperation and integration among finance
industries have emerged, some of the traditional distinctions between banks, insurance companies,
and securities firms have diminished. In spite of these changes, banks continue to maintain and
perform their primary role—accepting deposits and lending funds from these deposits.
HISTORY OF INDIAN BANKING SECTOR

The first bank in India, called The General Bank of India was established in the year 1786. The East
India Company established The Bank of Bengal/Calcutta (1809), Bank of Bombay (1840) and Bank
of Madras (1843). The next bank was Bank of Hindustan which was established in 1870. These three
individual units (Bank of Calcutta, Bank of Bombay, and Bank of Madras) were called as Presidency
Banks. Allahabad Bank which was established in 1865, was for the first time completely run by
Indians. Punjab National Bank Ltd. was set up in 1894 with head quarters at Lahore. Between 1906
and 1913, Bank of India, Central Bank of India, Bank of Baroda, Canara Bank, Indian Bank, and
Bank of Mysore were set up. In 1921, all presidency banks were amalgamated to form the Imperial
Bank of India which was run by European Shareholders. After that the Reserve Bank of India was
established in April 1935. At the time of first phase the growth of banking sector was very slow.
Between 1913 and 1948 there were approximately 1100 small banks in India. To streamline the
functioning and activities of commercial banks, the Government of India came up with the Banking
Companies Act, 1949 which was later changed to Banking Regulation Act 1949 as per amending Act
of 1965 (Act No.23 of 1965). Reserve Bank of India was vested with extensive powers for the
supervision of banking in India as a Central Banking Authority. After independence, Government has
taken most important steps in regard of Indian Banking Sector reforms. In 1955, the Imperial Bank of
India was nationalized and was given the name "State Bank of India", to act as the principal agent of
RBI and to handle banking transactions all over the country. It was established under State Bank of
India Act, 1955. Seven banks forming subsidiary of State Bank of India was nationalized in 1960. On
19th July, 1969, major process of nationalization was carried out. At the same time 14 major Indian
commercial banks of the country were nationalized. In 1980, another six banks were nationalized,
and thus raising the number of nationalized banks to 20. Seven more banks were nationalized with
deposits over 200 Crores. Till the year 1980 approximately 80% of the banking segment in India was
under government’s ownership. On the suggestions of Narsimhan Committee, the Banking
Regulation

Act was amended in 1993 and thus the gates for the new private sector banks were opened. The
following are the major steps taken by the Government of India to Regulate Banking institutions in
the country:

1949 : Enactment of Banking Regulation

Act. 1955 : Nationalisation of State Bank of India

. 1959 : Nationalization of SBI subsidiaries

. 1961 : Insurance cover extended to deposits.

1969 : Nationalisation of 14 major Banks.

1971 : Creation of credit guarantee corporation.

1975 : Creation of regional rural banks.

1980 : Nationalisation of seven banks with deposits over 200 Crores.

Nationalisation

By the 1960s, the Indian banking industry has become an important

tool to facilitate the development of the Indian economy. At the same
time, it has emerged as a large employer, and a debate has ensured
about the possibility to nationalize the banking industry. Indira Gandhi,
the-then Prime Minister of India expressed the intention of the
Government of India (GOI) in the annual conference of the All India
Congress Meeting the GOI issued an ordinance and nationalized the 14
largest commercial banks with effect from the midnight of July 19,
1969. Jayaprakash Narayan, a national leader of India, described the
step as a "Masterstroke of political sagacity" Within two weeks of the
issue of the ordinance, the Parliament passed the Banking Companies
(Acquisition and Transfer of Undertaking) Bill, and it received the
presidential approval on 9 August, 1969. A second step of
nationalization of 6 more commercial banks followed in 1980. The
stated reason for the nationalization was to give the government more
control of credit delivery. With the second step of nationalization, the
GOI controlled around 91% of the banking business in India. Later on, in
the year 1993, the government merged New Bank of India with Punjab
National Bank. It was the only merger between nationalized banks and
resulted in the reduction of the number of nationalized banks from 20
to 19. After this, until the 1990s, the nationalized banks grew at a pace
of around 4%, closer to the average growth rate of the Indian economy.
The nationalized banks were credited by some; including Home
minister P. Chidambaram, to have helped the Indian economy
withstand the global financial crisis of 2007-2009.

Liberalisation
There are two areas of competitions which banking industry is facing
internationally and nationally. In the early 1990s, the then Narsimha Rao
government embarked on a policy of liberalisation, licensing a small number of
private banks. In the pre-liberalization era, Indian banks could grow in a closed
economy but the banking sector opened up for private competition. It is possible
that private banks could become dominant players even within India. These came
to be known as New Generation tech-savvy banks, and included Global Trust Bank
(the first of such new generation banks to be set up), which later amalgamated
with Oriental Bank of Commerce, Axis Bank(earlier as UTI Bank), ICICI Bank and
HDFC Bank. This move along with the rapid growth in the economy of India
revolutionized the banking sector in India which has seen rapid growth with
strong contribution from all the three sectors of banks, namely, government
banks, private banks and foreign banks. The new policy shook the banking sector
in India completely. Use of ATM cards, Internet Banking, Phone Banking, Mobile
Banking are the new innovative channels of banking which are being widely used
as they result in saving both time and money which are two essential things that
everyone is short of and is running to catch hold of them. Moreover private sector
banks are aligning its infrastructures, marketing quality and technology to build
deep commitment in building consumer and retail banking. The main focus of
these banks is on innovative range of services or products. The Reserve Bank of
India is an autonomous body, with minimal pressure from the government. The
stated policy of the Bank on the Indian Rupee is to manage volatility but without
any fixed exchange rate-and this has mostly been true. With the growth in the
Indian economy expected to be strong for quite some time-especially in its
services sector-the demand for banking services, especially retail banking,
mortgages and investment services are expected to be strong .
 Chapter 2
COMPANY PROFILE

FORMATION OF THE COMPANY

The Housing Development Finance Corporation Limited (HDFC) was amongst the first to receive an 'in
principle' approval from the Reserve Bank of India (RBI) to set up a bank in the private sector, as
part of the RBI's liberalization of the Indian Banking Industry in 1994. The bank was
incorporated in August 1994 in the name of 'HDFC Bank Limited', with its registered office in
Mumbai, India. HDFC Bank commenced operations as a Scheduled Commercial Bank in
January 1995.

PROMOTER

HDFC is India's premier housing finance company and enjoys an impeccable track record in
India as well as in international markets. Since its inception in 1977, the Corporation has
maintained a consistent and healthy growth in its operations to remain the market leader in
mortgages. Its outstanding loan portfolio covers well over a million dwelling units. HDFC has
developed significant expertise in retail mortgage loans to different market segments and also ha
a large corporate client base for its housing related credit facilities. With its experience in the
financial markets, a strong market reputation, large shareholder base and unique consumer
franchise, HDFC was ideally positioned to promote a bank in the Indian environment.

2.3 BUSINESS FOCUS

HDFC Bank's mission is to be a World-Class Indian Bank. The objective is to build sound
customer franchises across distinct businesses so as to be the preferred provider of banking
services for target retail and wholesale customer segments, and to achieve healthy growth in
profitability, consistent with the bank's risk appetite. The bank is committed to maintain the
highest level of ethical standards, professional integrity, corporate governance and regulatory
compliance. HDFC Bank's business philosophy is based on four core values – Operational
Excellence, Customer Focus, Product Leadership and People.
2.4 VISION STATEMENT OF HDFC BANK

HDFC Bank's mission is to be a World Class Indian Bank. The objective is to build sound
customer franchises across distinct businesses so as to be the preferred provider of banking
services for target retail and wholesale customer segments, and to achieve healthy growth in
profitability, consistent with the bank's risk appetite. The bank is committed to maintain the
highest level of ethical standards, professional integrity, corporate governance and regulatory
compliance. HDFC Bank’s business philosophy is based on five core values: Operational
Excellence, Customer Focus, Product Leadership, People and Sustainability.

2.5 MISSION STATEMENT OF HDFC BANK

1.To our shareholders, our mission is to optimize returns.

2. To our customers, our mission is to provide a caring service by anticipating their requirements
and innovatively satisfying them beyond their expectations.

3. To our staff, our mission is to identify their multi-faceted talents, develop, motivate, recognize
and reward them towards fulfillment of the institutional and national housing vision.

4. To the national economy and the industry regulator, we are the key driver a shaping and
financing the national housing policy

5. To our natural environment, we enforce sustainable practices across all our activities.

2.6 BUSINESS STRATEGY

HDFC BANK mission is to be "a World Class Indian Bank", benchmarking themselves against
international standards and best practices in terms of product offerings, technology, service
levels, risk management and audit & compliance. The objective is to build sound customer
franchises across distinct businesses so as to be a preferred provider of banking services for
target retail and wholesale customer segments, and to achieve a healthy growth in profitability,
consistent with the Bank's risk appetite. Bank is committed to do this while ensuring the highest
levels of ethical standards, professional integrity, corporate governance and regulatory
compliance. Continue to develop new product and technology is the main business strategy of
the bank. Maintain good relation with the customers is the main and prime objective of the bank.
HDFC BANK business strategy emphasizes the following:

•Increase market share in India’s expanding banking and financial services industry by following
a disciplined growth strategy focusing on quality and not on quantity and delivering high quality
customer service.

•Leverage our technology platform and open scale able systems to deliver more products to more
customers and to control operating costs.

Maintain current high standards for asset quality through disciplined credit risk management.
•Develop innovative products and services that attract the targeted customers and address
inefficiencies in the Indian financial sector.

• Continue to develop products and services that reduce bank’s cost of funds

. Focus on high earnings growth with low volatility.

CAPITAL STRUCTURE

As on 31 March 2018 the authorized share capital of the Bank is Rs. 650 crore. The paid-up
share capital of the Bank as on the said date is Rs 519,01,80,534 /- which is comprising of
259,50,90,267 equity shares of the face value of Rs 2/- each. The HDFC Group holds 20.93 % of
the Bank's equity and about 18.23 % of the equity is held by the ADS / GDR Depositories (in
respect of the bank's American Depository Shares (ADS) and Global Depository Receipts (GDR)
Issues). 33.06% of the equity is held by Foreign Institutional Investors (FIIs) and the Bank has
5,32,368 shareholders.

TIMES BANK AMALGAMATION

In a milestone transaction in the Indian banking industry, Times Bank Limited (another new
private sector bank promoted by Bennett, Coleman & Co./Times Group) was merged with
HDFC Bank Ltd., effective February 26, 2000. As per the scheme of amalgamation approved by
the shareholders of both banks and the Reserve Bank of India, shareholders of Times Bank
received1 share of HDFC Bank for every 5.75 shares of Times Bank. The acquisition added
significant value to HDFC Bank in terms of increased branch network, expanded geographic
reach, enhanced customer base, skilled manpower and the opportunity to cross-sell and leverage
alternative delivery channels.

DISTRIBUTION NETWORK

HDFC Bank is headquartered in Mumbai. The Bank at present has an enviable network of over
1229 branches spread over 444 cities across India. All branches are linked on an online real-time
basis. Customers in over 120 locations are also serviced through Telephone Banking. The Bank's
expansion plans take into account the need to have a presence in all major industrial and
commercial centers where its corporate customers are located as well as the need to build a
strong retail customer base for both deposits and loan products. Being a clearing/settlement bank
to various leading stock exchanges, the Bank has branches in the centers where the NSE/BSE has
a strong and active member base. The Bank also has a network of about over 2526 networked
ATMs across these cities. Moreover, HDFC Bank's ATM network can be accessed by all
domestic and international Visa/MasterCard, Visa Electron/Maestro, Plus/Cirrus and American
Express Credit/Charge card holded

TECHNOLOGY

HDFC Bank operates in a highly automated environment in terms of information technology and
communication systems. All the bank's branches have online connectivity, which enables the
bank to offer speedy funds transfer facilities to its customers. Multi-branch access is also
provided to retail customers through the branch network and Automated Teller Machines
(ATMs).The Bank has made substantial efforts and investments in acquiring the best technology
available internationally, to build the infrastructure for a world class bank. The Bank's business
is supported by scalable and robust systems which ensure that our clients always get the finest
services we offer.

PRODUCT SCOPE

HDFC Bank offers a bunch of products and services to meet the every need of the people. The
company cares for both, individuals as well as corporate and small and medium enterprises. For
individuals, the company has a range accounts, investment, and pension scheme, different types
of loans and cards that assist the customers. The customers can choose the suitable one from a
range of products which will suit their life-stage and needs. For organizations the company has a
host of customized solutions that range from Funded services, Non-funded services, Value
addition services, Mutual fund etc. These affordable plans apart from providing long term value
to the employees help in enhancing goodwill of the company. The products of the company are
categorized into various sections which are as follows: •Accounts and deposits. •Loans.
•Investments and Insurance. •Forex and payment services. •Cards. •Customer center.

2.13 RECENT AWARDS AND ACHIEVEMENTS-

HDFC Bank began operations in 1995 with a simple mission: to be a "World-class Indian Bank".
We realised that only a single-minded focus on product quality and service excellence would
help us get there. Today, we are proud to say that we are well on our way towards that goal.It is
extremely gratifying that our efforts towards providing customer convenience have been
appreciated both nationally and internationally.

2.14 SWOT ANALYSIS OF HDFC BANK

1. Strengths in the SWOT analysis of HDFC

HDFC bank is the second largest private banking sector in India having 2,201 branches
and 7,110 ATM’s.

HDFC bank is located in 1,174 cities in India and has more than 800 locations to serve
customers through Telephone banking.

The bank’s ATM card is compatible with all domestic and international Visa/Master
card,
Visa Electron/ Maestro, Plus/cirus and American Express. This is one reason for HDFC
cards to be the most preferred card for shopping and online transactions.

HDFC bank has the high degree of customer satisfaction when compared to other
private
banks.

The attrition rate in HDFC is low and it is one of the best places to work in private
banking sector.

HDFC has lots of awards and recognition, it has received ‘Best Bank’ award from
various
financial rating institutions like Dun and Bradstreet, Financial express, Euromoney
awards
for excellence, Finance Asia country awards etc.

Weaknesses in the SWOT analysis of HDFC

HDFC bank doesn’t have strong presence in Rural areas, where as ICICI bank its direct
competitor is expanding in rural market.

HDFC cannot enjoy first mover advantage in rural areas. Rural people are hard core
loyals in terms of banking services.

HDFC lacks in aggressive marketing strategies like ICICI.

The bank focuses mostly on high end clients.

Some of the bank’s product categories lack in performance and doesn’t have reach in the
market.
The share prices of HDFC are often fluctuating causing uncertainty for the investors.

3. Opportunities in the SWOT analysis of HDFC

HDFC bank has better asset quality parameters over government banks, hence the profit
growth is likely to increase.

The companies in large and SME are growing at very fast pace. HDFC has good
reputation in terms of maintaining corporate salary accounts.

HDFC bank has improved it’s bad debts portfolio and the recovery of bad debts are high
when compared to government banks.

HDFC has very good opportunities in abroad.

Greater scope for acquisitions and strategic alliances due to strong financial position.

4. Threats in the SWOT analysis of HDFC

HDFC’s nonperforming assets (NPA) increased from 0.18 % to 0.20%.

The non-banking financial companies and new age banks are increasing in India.

The HDFC is not able to expand its market share as ICICI imposes major threat.

The government banks are trying to modernize to compete with private banks.

RBI has opened up to 74% for foreign banks to invest in Indian market.
 CHAPTER 3

DATA ANALYSIS

The banking scenario in India has been changing at fast pace from being just the
borrowers and lenders traditionally, the focus has shifted to more differentiated
and customized product/service provider from regulation to liberalization in the
year 1991, from planned economy to market.

Economy, from licensing to integration with Global Economics, the changes have
been swift. All most all the sector operating in the economy was affected and
banking sector is no exception to this. Thus the whole of the banking system in
the country has undergone a radical change. Let us see how banking has evolved
in the past 57 years of independence.

After independence in 1947 and proclamation in 1950 the country set about
drawing its road map for the future public ownership of banks was seen inevitable
and SBI was created in 1955 to spearhead the expansion of banking into rural
India and speed up the process of magnetization.
Political compulsion’s brought about nationalization of bank in 1969 and lobbying
by bank employees and their unions added to the list of nationalized banks a few
years later.

Slowly the unions grew in strength, while bank management stagnated. The
casualty was to the customer service declined, complaints increased and bank
management was unable to item the rot.

In the meantime, technology was becoming a global phenomenon lacking a vision

of the future and the banks erred badly in opposing the technology up gradation
of banks. They mistakenly believed the technology would lead to retrenchment
and eventually the marginalization of unions.

The problem faced by the banking industry soon surfaced in their balance sheets.
But the prevailing accounting practices unable banks to dodge the issue.

The rules of the game under which banks operated changed in 1993. Norms or
income Recognition, Assets classification and loan loss provisioning were put in
place and capital adequacy ratio become mandatory. The cumulative impact of all
these changes has been on the concept of state ownership in banks. It is
increasingly becoming clear that the state ownership in bank is no longer
sustainable.

The amendment of banking regulation act in 1993 saw the entry of new private
sector banks and foreign banks.

MAJOR PLAYER IN INDIA

1. HDFC BANK LTD

2. ICICI BANK LTD
3. STATE BANK OF INDIA LTD
4. PUNJAB NATOINAL BANK LTD
5. BANK OF BARODA LTD
6. FEDERAL BANK LTD
7. AXIS BANK LTD
8. ING VYSYA BANK LTD
9. IDBI BANK LTD
10. INDUSIND BANK LTD
11. YES BANK LTD

The Housing Development Finance Corporation Limited (HDFC) was amongst the
first to receive an 'in principle' approval from the Reserve Bank of India (RBI)
to set up a bank in the private sector, as part of the RBI's liberalization of the
Indian Banking Industry in 1994. The bank was incorporated in August 1994 in
the name of 'HDFC Bank Limited', with its registered office in Mumbai, India.
HDFC Bank commenced operations as a Scheduled Commercial Bank in January
1995. HDFC is India's premier housing finance company and enjoys an
impeccable track record in India as well as in international markets. Since its
inception in 1977, the Corporation has maintained a consistent and healthy
growth in its operations to remain the market leader in mortgages. Its
outstanding loan portfolio covers well over a million dwelling units. HDFC has
developed significant expertise in retail mortgage loans to different market
segments and also has a large corporate client base for its housing related
credit facilities. With its experience in the financial markets, a strong market
reputation, large shareholder base and unique consumer franchise, HDFC was
ideally positioned to promote a bank in the Indian environment.

HDFC Bank began operations in 1995 with a simple mission : to be a “ World Class
Indian Bank.” We realized that only a single minded focus on product quality
and service excellence would help us get there. Today, we are proud to say that
we are well on our way towards that goal.

HDFC Bank Limited (the Bank) is an India-based banking company engaged in

providing a range of banking and financial services, including commercial banking
and treasury operations. The Bank has a network of 1412 branches and 3295
automated teller machines (ATMs) in 528 cities and total employees is 52687.
 BRANCHES (NOS) ATMs (Nos.)

1412 3295

761 1977
684 1605

2007 2008 2009 2007 2008 2009

43.9
38.2
29.1

2007 2008 2009

 Chapter 4

THEORETICAL FRAMEWORK OF THE STUDY

The Theoretical framework is the structure that can hold or support a theory of a
research study. The theoretical framework introduces and describes the theory
which explains why the research problem under study exists.

Banks are the most important financial institutions in the economy. They are the
principal source of credit ( loanable funds) for millions of families and for many
units of government (school districts, cities, countries etc.). Banks play a major
role in the economic development process. The country's economy depends
upon the efficient functioning of the banking system. Banks are the financial
service firms, producing and selling professional management of the public's
funds and performing many other roles in the economy. Earlier, the services
offered by banks included currency exchange, savings deposits, discounting
commercial notes and making business loans, supporting government activities
with credit, safekeeping of valuables and certification of value, offering trust
services, offering checking accounts (demand deposits) etc. The services banks
have developed more recently are granting consumer loans, financial advising,
offering equipment leasing, making venture capital loans, selling insurance
services, selling retirement p The Indian banking system had gone through a
series of cries and consequent bank failures and thus its growth was quite slow
during the first half of this century. But after Independence, the Indian banking 1
system has recorded rapid progress. This was due to planned economic growth,
increase in money supply, growth of banking habit, control and guidance by the
Reserve bank of India, and above all, nationalization of 14 banks in July 1969.
lans, offering security brokerage and security underwriting services.
 Table 1.1 Advances to Priority Sector by Public sector Banks

No. of Accounts (in Lakhs) Amount (in crores)

Sectors (As on the last reporting Friday)

June 1969 March 2008 June 1969 March 2008

i Agriculture 1.7 162 2,49,397

276
ii Small-scale 0.5 _ 257 _
industries
iii (A) Small _ 40 _ 1,51,137
Enterprise*
Iv Other priority 0.4 _ 22 _
sector
advances
V Retail Trade* _ 32 _ 40,519
Vi Micro -Credit* _ 7 _ 2707
Vii Education* _ 12 _ 19,748
Viii Housing* - 34 _ 1,46,868
ix Total priority 2.6 401 441 6,10,450
sector
advances

Table 1.1 shows that amongst the total priority sector advances, the largest
advances have always been towards agriculture sector. Accordingly, the number
of accounts for agriculture sector as on June 1969 was only 1.7 Lakhs which
increased to 276 Lakhs accounts as on March 2008. Accordingly, the amount
outstanding thereof as on June 1969 was Rs. 162 crores which increased to Rs.
2,49,397 crores as on March 2008 respectively. Accordingly, as on March 2008,
number of accounts for education loans was 12 Lakhs and amount outstanding
was Rs. 19,748 crores respectively. The total priority sector advances has shown a
tremendous increase from 14.6 percent as on June 1969 to 44.7 percent as on
March 2008.
1.1.5 Deposit Mobilisation:
At the time of first nationalization, the total deposits of all scheduled commercial
banks were about Rs.5,000 crores. The Indian banking system prior to the Banking
Regulation Act was not very sound. There were many small banks with
unscrupulous management. However, after the Banking Regulation Act, following
the nationalization, there was a phenomenal rise in bank deposits of scheduled
commercial banks. Aggregate bank deposits on last Friday of March 1991 were Rs.
1,92,541 crores as against Rs. 4,665 crores in July 1969.

1.1.6 Bank Credit:

Post nationalization of 14 banks, substantial amounts of loans have been given for
agricultural operations. Total bank credit stood at Rs.1,16,301 crores on last
Friday of March 1991. Since nationalization of 14 major banks, there has been
spectacular rise in bank credit. In July 1969 it was only Rs.3,399 crores. Over a
period of 22 years bank credit had steadily increased and was more than 34 times
in March 1991 of what it was at the time of nationalization of banks.

The State and population group-wise distribution of number of Reporting Offices,

Aggregate Deposits and Gross Bank Credit Nationalized Banks as on September
2007 is presented in the following table:-

Table 1.2
State and Population Group-Wise Distribution of Number of Reporting Offices, Aggregate Deposits
and Gross Bank Credit Nationalized Banks-September 2007

REGION/ STATE/ OFFICES DEPOSITS CREDIT

UNION TERRITORY
North 6,101 330,773 222,387
North-East 816 18,904 6,939
East 6,167 169,295 84,087
Central 6,789 179,210 81,663
West 6,834 395,655 324,452
South 9,371 274,017 240,501
All India 36,078 1367,855 960,030
Table 1.2 points out clearly that the western region is leading in terms of deposit
collection and credit offered, in comparison to other regions. As per the
'Quarterly Statistics on Deposits and Credit of Scheduled Commercial Banks -
September 2007' released by the RBI, stated that nationalized banks, as a group,
accounted for 47.9 per cent of the aggregate deposits, while State Bank of India
and its Associates accounted for 22.6 per cent. As regards gross bank credit, the
share of nationalized banks was the highest at 47.0 per cent, followed by State
Bank of India and its Associates at 22.9 per cent. The aggregate bank deposits
were Rs. 4,665 crores in July 1969 which rose to Rs.1,36,7855 crores by
September 2007. The total bank credit in July 1969 was only Rs.3,399 crores
which spectacularly rose to Rs.9,60,030 crores respectively by the end of
September 2007.

1.1.7 Performance of Priority Sector Advances:

Credit growth to the priority sector by all scheduled commercial banks
decelerated to 24.0 per cent in 2006-07 from 36.1 per cent in the previous year.
The details of credit to priority sector are presented in the following table:-
Table 1.3 Credit to Priority Sector (Amount Rs. in Crores)

Outstanding as on
Category March 19, March 18, March 31, March 30,
2004 2005 2006 2007
Priority Sector 2,63,834 3,74,953 5,10,175 6,32,647
(a+b+c) (24.7) (42.1) (36.1) (24.0)
a) Agriculture 90,541 1,24,269 1,73,875 2,30,180
(23.2) (37.3) (39.9) (32.4)
b) Small Scale 65,855 74,189 91,020 1,16908
Industries (9.0) ( 12.7) (22.7) (28.4)
c) Other Priority 1,07,438 1,76,495 2,45,280 2,85,559
Sectors (including (38.3) (64.3) (39.0) (16.4)
Education Loans)

Note: Figures in parenthesis represent percentages to net bank credit for the respective
groups.
Table 1.3 shows that credit to 'other priority sector', which witnessed a sharp
growth in recent years, also decelerated sharply during 2006- 07.14 However,
while credit growth to agriculture decelerated, credit growth to small scale
industries accelerated.

1.1.8 Public Sector Banks

In November 1974, public sector banks were advised that their priority sector
lending should reach a level of not less than one-third of the 17 outstanding credit
by March 1979. In November 1978, the private sector banks were also advised to
lend a minimum of 33 1/3 per cent of their total advances to the priority sectors
by the end of March 1980. Subsequently, the target was enhanced to 40 per cent
of aggregate advances.
 CHAPTER 5
SUMMARY

Market research is a function that links the consumer,

customer and public to the market through information.
Information are used to identify and define marketing
opportunities and problems, evaluate market actions, monitor
marketing performance and improve understanding of
marketing as process. Purpose of the study is to find out
customers satisfaction, awareness and preference for HDFC
bank product.

Research objectives are:- Customers sentiments on the

various services provided by bank.
To measure the awareness level of people regarding banking
services offered by bank
To evaluate overall satisfaction level of customers regarding
services and products offered by the bank.
Findings
Majority of customer are satisfy with HDFC bank service and prefers to use HDFC bank Majority of
customers are aware of services provided by HDFC bank Majority of customers fined banking facility of
HDFC bank satisfactory Majority of customers are willing to recommended HDFC bank to their friends
Respondents says that they are facing issues regarding time and facility while few has some issue with
employee behavior The perception of customer regarding the bank is satisfactory because majority of
the customer are satisfy with the bank and they also recommend the product of the bank The more
prefers extra service is Net banking and less prefers service are bill payment, ATM and mobile banking
Majority of customer are satisfy with dealing of employees Main factor that attracts customers towards
banks are services of bank

 76% customers have experienced problems related to their banking account at least once or 1-
5 times
? Almost 74% of customers get ‘always’ or ‘often’ get prompt service whenever they visit the
bank branch
? 72% of HDFC sampled customers use services of other alternate banks
? 50% of the HDFC Bank customers are very satisfied with the service provided by the
customer care service representatives and 20% are somewhat satisfied
? 22% sampled customers strongly disagree that the average monthly balance is easy to
maintain whereas 11% customers disagree with the same.
Conclusion

At the end I would like to conclude that the Indian banking market is growing at an astonishing
rate. HDFC bank has distribution network of 4,715 branches and 12,260 ATMs across 2,657
cities in India. the majority of customers are prefers HDFC bank but bank should target rest of
customer who are not satisfied. customers are aware about bank services but bank should try
to create more awareness among people.

More stress should given on the advertisement and promotion activities

The bank should make more effort in improving good relationship with customer

The bank should enhance their service according to customer

The bank should make its procedure less time consuming

The bank should make effort to aware the customer about all their extra services

there is a lot of stiff competition among the private banks in India. The race to get on
top of the leader board never stops. The majority of customers are satisfied. But the
bank should try to target on the rest of the customers who are not satisfied. The
customers are aware about the bank’s services but the Bank should try to create more
bank awareness so that it can increase its customer base. HDFC Bank should introduce
advertising strategies; it can use digital media as it is one of the strongest emerging
tools in today’s scenario. HDFC should also try to target people of all income groups to
increase its consumer base.

HDFC Bank the banking arm of hdfc is expected to go on stream. The bank already has
good numbered employees on board and is recruiting personal banker heavily to take
the headcount to many more. It is on the brim of increasing its customer through its
attractive schemes and offer .

The project opportunities provided was market segmentation and identifying prospective
customers in potential geographical location and convincing them to attract more
customers so that new business opportunities of the bank can be explored.
 Suggestions

Finally some recommendation for the company are as fallows :-

1 To make people aware about the benefit of becoming a customer of HDFC bank,following activities of
advertisement should be done through

1. print media
2. Hoarding and banners
3. Stalls in trade fares
4. Distribution of leaflets containing details information

Other facilities must be provide to the customer :

1. The bank should provide life time valid ATM card to all its customers
2. minimum balance for saving account should be reduced from RS 10000 to RS 1000.so that
people who are not financially strong enough can maintain their account properly .
3 The company should provide a pass book to all its customers
4 Make people understand about the various benefits of its products
5 company should open more branches in different cities .
Annexure

NAME:__________________

AGE:_________________

OCCUPATION:_____________________

ANNUAL INCOME:_________________

MOBILE NUMBER:______________

1)Since how many year you are dealing with bank?

A) Less than 1 year

B) 1 to 2 year

C) 3 to 5 year

D) More than 5 year

2)What kind of facility are you using @HDFC bank?

A) Saving ac

B) Current ac

C) Salary ac

D) Others

3) Are you aware of other services provided by HDFC bank?

A) Yes

B) No

4) What kind of additional service would like to have?

A) Mobile banking

B) ATM
C) Net banking

d) Bill payment

5 Are you aware of any other extra services?

A) Loan

B) Insurance

C) Fixed deposit

D) Mutual funds

6)What is your perception regarding service of HDFC bank?

A) Very satisfactory

B) Satisfactory

C) Good

D) Poor

7) Any problem you are facing regarding HDFC bank?

A)Employee behavior

B) Facility

C) Time issue

D) Others

8) How likely you will recommended HDFC bank Services?

A) Very likely

B) Likely

C) Somewhat

D) Unlikely
9) What is your overall satisfaction rating with bank?

A) Very satisfactory

B) Satisfactory

C) Good

D) Poor

Bibliography

WEBSITES REFFERED:

www.en.wikipedia.org

www.bankbazaar.com

www.hdfcbank.com

www.wikihow.com

www.scholar.google.co.in

www.campusoxide.com

www.blog.edusson.com

www.marketing91.com

www.quora.com

www.moneyconnexion.com