A

Department of Commerce,
Graphic Era Hill University

SEMINAR REPORT
ON
“Various financial Services Product Provided by HDFC
BANK”

SUBMITTED TO:
UTTRAKHAND TECHNICAL UNIVERSITY, DEHRADUN
REQUIRED IN PARTIAL FULFILLMENT FOR THE DEGREE OF
MASTER OF BUSINESS ADMINISTRATION (2007-2009)

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GUIDED BY: SUBMITTED BY
Ms. ANITA CHATURVEDI SHISHUPAL
(LECTURER-NAM) MBA-4th SEM
M.B.A. PROGRAMME
A PROJECT REPORT ON

“VARIOUS FINANCIAL SERVICES PRODUCT

PROVIDED BY HDFC BANK”

Submitted Graphic Era University

In the partial fulfillment of
Master of Business Administration (Two Year Full Time Degree
Course)

Submitted by:
Name: Manmeet Kaur Bhutaini
Class: MBA
Batch: 2009-2011

GRAPHIC ERA UNIVERSITY, DEHRADUN

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 Table of Contents

1. Certificate from the internal/ faculty guide

2. Acknowledgement

3. Preface

4. Executive Summary

5. Introduction

6. Objectives

7. Research Methodology

7.1 Research Design

7.2 Research Tools

7.3 Collection/ Compilation of Data

7 .4 Data Analysis & Interpretation

8. Data analysis and Findings

9. Limitations of Study

10. Implications

11. Conclusion

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12. Bibliography

CERTIFICATE OF INTERNAL /FACULTY GUIDE

This is to certify that Manmeet Kaur Bhutuani , a student of BBA (2010-2013), Graphic
Era University, Dehradun has made a report in HDFC BANK.
This dissertation report has the requisite standard for the partial fulfillment of the
Bachelor of Business Administration. To the best of our knowledge no part of this report
has been reproduced from any other report and the contents are based on original
research.

MR. AMJAD ALI KHUSHBOO SINGH

(Faculty Guide) (Student)

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 ACKNOWLEDGMENT

This is not the work of individual but a number of persons who are directly and indirectly
helped in its preparation. So it is my duty to express my gratitude to those who have
helped and assisted me in giving final shape to this dissertation

I would like to thank Mr. AMJAD ALI (ASST. PROF.) for supporting me during this
project and providing me an opportunity to learn outside the classroom. It was a truly
wonderful learning experience.

I would like to dedicate this project to my faculty and industry mentor. Without their help
and constant support this project would not have been possible.

KHUSHBOO SINGH

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 PREFACE

All the learning in our B.B.A course is practice oriented. However, hands-on experience
in the corporate world during our course is very necessary to be able to test the ability
and extent of learning of the student before fully entering the corporate world.

The dissertation which I underwent at HDFC bank was a wonderful learning experience.
I was assigned the project “VARIOUS FINANCIAL SERVICES PRODUCT
PROVIDED BY HDFC BANK.”

I started first phase of my Research i.e. to identify which type of financial product should
market to particular market segments in India. A survey was undertaken to understand the
preferences of Indian consumers with respect to financial products. While marketing
policies the sole duty of an advisor/ agent is to provide various financial products as per
the customer requirements.

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 HDFC –EXECUTIVES SUMMARY

HDFC is an organization that strives for excellence, with the twin objective of enhancing
customer satisfaction and shareholder value.

Single-minded focus on product quality and service excellence has helped us garner the
appreciation of both national and international organizations.

HDFC is India’s leading housing finance institution and has helped build more than   
30, 0 0,000 houses since its incorporation in 1977.

Rated ‘AAA’ by CRISIL and ICRA for the 10th consecutive year

Stable and experienced management

High service standards

Presented the ‘Dream Home’ award for the best housing finance provider in 2004 at   the
third Annual Outlook Money Awards.

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 INTRODUCTION

HDFC Bank
HDFC Bank was incorporated in August 1994 in the name of 'HDFC Bank Limited', with
its registered office in Mumbai, India. The Bank commenced operations as a Scheduled
Commercial Bank in January 1995. 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.

Headquartered in Mumbai, HDFC Bank, has a network of over 531 branches spread over
228 cities across India. All branches are linked on an online real-time basis. Customers in
over 120 locations are serviced through Telephone Banking. The Bank also has a network
of about over 1054-networked ATMs across these cities. 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 cardholders.

HDFC Bank has won many awards for its excellent service. Major among them are "Best
Bank in India" by Hong Kong-based Finance Asia magazine in 2005 and "Company of
the Year" Award for Corporate Excellence 2004-05.

HDFC Bank), one amongst the firsts of the new generation, tech-savvy commercial
banks of India, was set up in January 1995, after the Reserve Bank of India allowed
setting up of Banks in the private sector. The Bank was promoted by the Housing
Development Finance Corporation Limited, a premier housing finance company (set up
in 1977) of India. Net Profit for the year ended March 31, 2006 was Rs. 1,141 crores.
Results of the latest quarter ended June 2007, indicate that the bank continues to grow in
a steady manner.

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Branch network

Currently HDFC Bank has 753 branches, 2500 ATMs, in 320 cities in India, and all
branches of the bank are linked on an online real-time basis. The bank offers many
innovative products & services to individuals, corporate, trusts, governments,
partnerships, financial institutions, mutual funds, insurance companies.

It is a path breaker in the Indian banking sector

Recognition

Over a decade of its operations, HDFC Bank has been recognized, rated and awarded by
a number of organizations, which includes:

 Best Domestic Bank in India in The Asset Triple A Country Awards 2005, 2004
and 2003.
 “Company of the Year” Award in The Economic Times Awards for Corporate
Excellence 2004-05.
 Asiamoney's Awards for Best Domestic Commercial Bank as well as Best Cash
Management Bank - India in 2005.
 The Asian Banker Excellence in Retail Banking Risk Management Award in
India for 2004.
 Finance Asia “Best Bank - India” in 2005, "Best Domestic Commercial Bank –
India” in 1999, 2000 and 2001 respectively and “Best Local Bank – India” in
2002 and 2003.
 Business Today “Best Bank in India” in 2006, 2007, 2008 and 2009.
 “Best Overall Local/Domestic Bank – India” in the Corporate Cash Management
Poll conducted by Asiamoney magazine.
 Selected by BusinessWorld as "one of India's Most Respected Companies" as part
of The Business World Most Respected Company Awards 2004.
 In 2004, HDFC Bank won the award for “Operational Excellence in Retail
Financial Services” - India as part of the Asian Banker Awards 2003.

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  In 2003, Forbes Global named HDFC Bank in its ranking of “Best Under a
Billion, 200 Best Small Companies for 2003”.
 The Financial Express named HDFC Bank the “Best New Private Sector Bank
2003” in the FE-Ernst & Young Best Banks Survey 2003.
 Outlook Money named HDFC Bank the “Best Bank in the Private Sector” for the
year 2003.
 NASSCOM and economictimes.com have named HDFC Bank the ‘Best IT User
in Banking’ at the IT Users Awards 2003.
 Euromoney magazine gave HDFC Bank the award for "Best Bank – India” in
1999, “Best Domestic Bank” in India in 2000, and “Best Bank in India” in 2001
and 2002.

CREATIVITY AND INNOVATION IN RETAIL BANKING

Today, we take services like ATM, Mobile alerts and Net banking for granted. These
services have become so ingrained in our life styles that it is difficult to imagine a single
day without these conveniences. Conveniences come at a cost and it would be constant
creativity and innovation for customizing these products to fulfill the present as well as
the emerging needs. Creativity implies evolution of ideas; generation of new thinking,
new aims, and perspectives and in turn the ability to think beyond the unthinkable.
“Creative thinking ability facilitates the ability to realize Innovation”. Innovation and
creativity are like hand in the glove. They are both very intricately connected. Innovation
and creativity in context to the retail banking, has been revolutionary, the transactions
that used to take a long waiting time are now happening at the click of mouse or snap of
the finger, this has enabled the banks to offer accessible services like Internet banking, 24
hrs banking and much more. The transformation in retail banking is an exemplary
depiction of creativity and Innovation. The banks no longer offer simple plain products.
Banks are offering various innovative and creative products like Internet banking, home
loans, Mutual Funds Credit and Debit Cards, Insurance, ATMs, mobile banking etc.,
Today, the banks have become ‘one stop shops’; offerings a vast array of financial

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products since liberalization. This evolution in retail banking is a source of inspiration for
undertaking this analysis.

The banking sector has gone through innumerable twists and turns in the post-
independence era and especially in context of the retail banking. Retail banking segment
in the banking industry is continuously undergoing product innovations, product
reengineering, adjustments and alignments as upgraded technology has brought a
revolution in this sector and it is attributed to observations by prominent committees like
Narsimha Committee on Financial Sector Reforms and Ranga Rajan Committee on
Mechanization. It has become imperative and essential for the banks to introduce new,
creative & innovative products to increase their market share in today’s dynamic and
competitive market arena.

Most of the Indian banks have been retail banks in their business composition. The term
Retail Banking encompasses various financial products; different type of deposit account;
housing, consumer auto and other types of Loan accounts, Demat facility, Insurance,
Mutual Funds, Credit and Debit cards, ATMs, stock broking, payment of utility bills and
other technology based services. Banks have evolved from Ugly Duckling to the Golden
Goose. This paradigm shift in the role of banking sector is evident from the focus of
banks on customer centric Innovations in the Bankers’ kitty. A customer is no more a
Customer of the branch.

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 MAN WITH A MISSION

If ever there was a man with a mission it was Hasmukhbhai Parekh, our Founder and
Chairman-Emeritus, who left this earthly abode on November
18, 1994.

Born in a traditional banking family in Surat, Gujarat, Mr.

Parekh started his financial career at Harkisandass Lukhmidass
– a leading stock broking firm. The firm closed down in the
late seventies, but, long before that, he went on to become a
towering figure on the Indian financial scene.

In 1956 he began his lifelong financial affair with the economic world, as General
Manager of the newly formed Industrial Credit and Investment Corporation of India
(ICICI). He rose to become Chairman and continued so till his retirement in 1972.

At the ripe age of 60, Hasmukhbhai started his second dynamic life, even more illustrious
than his first. His vision for mortgage finance for housing gave birth to the Housing
Development Finance Corporation – it was a trendsetter for housing finance in the whole
Asian continent.

He was a true development banker. His building up HDFC without any government
assistance is itself a brilliant chapter in financial history. His wisdom and warmth drew
people from all walks of life to him, for advice, guidance and inspiration.

A soft-spoken man of few words, Mr. Parekh nevertheless held strong and definite views
with a quiet conviction. He was always concerned with building bridges, improving and
encouraging communication between people.

He was also a writer in his own right. There are over 200 published articles by him, full
of incisive comments on finance and economics. In 1953 he brought out a volume called:
The Bombay Money Market. It detailed the intricate working of the Indian money

Page 12
market. His works in Gujarati – Hirane Patro, Hirane Vadhu Patro – occupy pride of
place in Gujarati literature. In 1992, the Government of India honoured him with the
Padma Bhushan Award. The London School of Economics & Political Science conferred
on him an Honorary Fellowship.

But there was much more to the man than his financial genius. In his own unassuming
way, Hasmukhbhai devoted all his life to raising resources for philanthropic causes. He
was one of the Founder Members of the Centre for Advancement of Philanthropy, and its
Chairman till 1993. He took active interest in the Bombay Community Public Trust,
designed specifically to serve the needs of the city’s underprivileged citizens.

Business Objectives

The primary objective of HDFC is to enhance residential housing stock in the country
through the provision of housing finance in a systematic and professional manner, and to
promote home ownership. Another objective is to increase the flow of resources to the
housing sector by integrating the housing finance sector with the overall domestic
financial markets.

Organisational Goals

HDFC’s main goals are to a) develop close relationships with individual households, b)
maintain its position as the premier housing finance institution in the country, c)
transform ideas into viable and creative solutions, d) provide consistently high returns to
shareholders, and e) to grow through diversification by leveraging off the existing client
base.

Future

HDFC has always been market-oriented and dynamic with respect to resource
mobilization as well as its lending programme. This renders it more than capable to meet
the new challenges that have emerged. Over the years, HDFC has developed a vast client

Page 13
base of borrowers, depositors, shareholders and agents, and it hopes to capitalize on this
loyal and satisfied client base for future growth. Internal systems have been developed to
be robust and agile, to take into account changes in the volatile external environment.

HDFC has developed a network of institutions through partnerships with some of the best
institutions in the world, for providing specialized financial services. Each institution is
being fine-tuned for a specific market, while offering the entire HDFC customer base the
highest standards of quality in product design, facilities and service.

Our key strengths

Financial Expertise

As a joint venture of leading financial services groups, HDFC Standard Life has the
financial expertise required to manage your long-term investments safely and efficiently.

Range of Solutions

We have a range of individual and group solutions, which can be easily customized to
specific needs. Our group solutions have been designed to offer you complete flexibility
combined with a low charging structure

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AWARDS AND ACHIEVEMENTS

HDFC features in BusinessWeek’s ‘Top 50 Asian Company’ lists

HDFC features in the prestigious list of Asia's 50 best performing companies compiled
by the international magazine BusinessWeek. HDFC was part of the 12 Indian entities
that made it to the list, which includes Siemens, Sterlite Industries, CIPLA, Suzlon
Energy, Hero Honda Motors, TCS, ITC, Tata Motors, Tata Steel, Bharat Heavy
Electricals and Sun Pharmaceutical Industries. This list of eminent Asian companies has
been compiled based on their performance in the past financial year and were compared
vise-vie their industry peers based on parameters like average return on capital, sales
growth, return on shareholder equity, etc. A panel of editors and correspondents of the
magazine then reviewed the final list.

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What is complementing is that, this year's edition comprises 12 Indian companies, the
maximum for any country in the region, which attests to the continuing dynamism of
India.
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.

It is extremely gratifying that our efforts towards providing customer convenience have been
appreciated both nationally and internationally.

2007

The Asian Banker Best Retail Bank in India

Excellence in Retail
Financial Services
Awards

Asian Banker Our Managing Director Aditya Puri wins the Leadership
Achievement Award for India

2006

Business Today Best Bank in India.

Forbes Magazine One of Asia Pacific's Best 50 companies.

Businessworld Best listed Bank of India.

The Asset Magazine's Best Domestic Bank.

Triple A Country
Awards

Asiamoney Awards Best Local Cash Management Bank in Large and Medium
segments.

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 Euromoney Awards "Best Bank" in India.

2005

Asiamoney Awards Best Domestic Commercial Bank

Asiamoney Awards Best Cash Management Bank - India .

The Asian Banker Retail Banking Risk Management Award in India.

Excellence

Hong Kong-based Best Bank India

Finance Asia
magazine

Economic Times "Company of the Year" Award for Corporate Excellence.

Awards

The Asset Triple A Best Domestic Bank in India Region - 2005

Country Awards

The Business Today- Best Local Cash Management Bank in India US$11-100m – 2005
KPMG Survey

The Business Today- "Best Bank in India" for the third consecutive year in 2005.
KPMG Survey

Economic Times - "Most Customer Responsive Company - Banking and Financial

Avaya Global Services - 2005
Connect Customer
Responsiveness
Awards

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 2004

Asiamoney Best Local Cash Management Bank in India US$11-100m

Awards

Asiamoney Best Local Cash Management Bank in India >US$501m

Awards

Asiamoney Best Local Cash Management Bank in India 1989-2004 (poll of

Awards polls)

Asiamoney Best Overall Domestic Trade Finance Services in India – 2004

Awards

Asiamoney Most Improved company for Best Management Practices in India –

Awards 2004

Business World One of India's Most Respected Companies - 2004

Forbes Global Best Under a Billion, 100 Best Smaller Size Enterprises in
Asia/Pacific and Europe - 2004

Asian Banker Operational Excellence in Retail Financial Services – 2004

Awards

The Asset Triple A Best Domestic Bank in India - 2004

Country Awards

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 2003

Forbes Global Best Under a Billion, 200 Best Small Companies - 2003

The Asset Triple A Best Domestic Bank in India -2003

Country Awards

BusinessWorld - One of India's Most Respected Companies

The Business
World Most
Respected
Company Awards

The Asset Best Cash Management Bank

magazine

The Asset Best Trade Finance Bank

magazine

FE-Ernst & Young Best New Private Sector Bank - 2003

Best Banks Survey

Outlook Money Best Bank in the Private Sector – 2003

Business Today Best Bank in India -2003

NASSCOM & Best IT User in Banking -2003

economictimes.com
- IT Users Awards

Awards: 2007

 HDFC ranked 3rd amongst the Asian Banking and Finance Sector for ‘Highest Return
on Equity’ by Asiamoney

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 Ms Renu Sud Karnad, Executive Director, was one of the eminent women felicitated by
the FICCI Ladies Organization at their Women Achievers Award – 2007
Awards: 2006
 Mr Deepak Parekh, Chairman HDFC Ltd. awarded the Best Non Executive Director
2006 by the Asian Centre for Corporate Governance
 Mr Keki Mistry, Managing Director HDFC Ltd. awarded the Best Performing CFO in
the Financial Services Sector at the CNBC-TV18 CFO Awards 2006
 HDFC won the award for 'Investment Management in India' at the EUROMONEY 2006
Real Estate Awards
 'Best Home Loan Provider' title at the Zee Business Pinnacle Awards, 2006
 Limca Book of Records, 2006: HDFC for the landmark achievement of Rs. One Lakh
Crore
 ‘Best Strategy’, at the 4Ps Business, Marketing & Advertising Power Awards 2006
 Dun & Bradstreet – American Express Corporate Awards 2006
 Mr. Deepak Parekh, Chairman, HDFC Ltd. conferred with the prestigious Padma
Bhushan award

Awards: 2005

 HDFC receives award for 'The Best Presented Accounts' of The Institute of Chartered
Accountants of India for 2004-05
 HDFC Ranked as ‘India’s Third Best Managed Company’ by FinanceAsia – 2005
 Mr Deepak Parekh awarded the 'Hall of Fame' award by Outlook Money magazine.
 HDFC receives the 'Dream Home' award for the best Housing Finance company for 2004
from Outlook Money magazine

Awards: 2004

 Awards galore by HDFC at the 44th ABCI Awards !!!

 5th Best Company to work for in India, ranked by Business Today in November 2004
 Economic Times Corporate Citizen of the Year Award, November 2004
 Rated by Deutsche Bank as one of the top 5 banks/Financial Institutions in Asia in

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 October 2004
 Ranked among the Top 20 companies to deliver healthiest returns to shareholders,
Outlook Money Magazine - September 2004
 1st Prize at the New York Festival's Gold Midas Awards for Environmental
Communication Ad in August 2004
 Features in the Forbes list of Top 20 Leading Indian Companies in May 2004.
 One of the Top 10 Investor Friendly Companies, ranked by Business Today in March
2004.
 HDFC Ranked No. 3 - 'India's Best Managed Companies' by FinanceAsia

Awards: 2003
 Clean Sweep by HDFC at the 43rd ABCI Awards!!!
 National Award for Excellence In Corporate Governance by The Institute of Company
Secretaries of India
 2nd Best Company for Corporate Governance in India by The Asset magazine.
 The Economic Times Lifetime Achievement Award - 2003. ( for Mr. Deepak Parekh -
Chairman, HDFC Ltd. )
 One of the Top Ten - Most Admired Companies in India ' - 2003 by Business Barons
 One of the Top Ten - Most Admired CEOs in India ' - 2003 by Business Barons (for Mr.
Deepak Parekh )
 India's Second Best Managed Company - 2003 by Finance Asia.
 India's Biggest Wealth Creator in the banking and financial services by the fourth
Business Today - Stern Steward Survey.
 One of the Top Ten - Most Respected Companies in India' by Businessworld.
Highest rating for ' Governance and Value Creation ' by CRISIL.
 One among the top ten ' Company Leaders in India' by the Far Eastern Economic Review
Survey.
 Best Managed Financial Institution in India' by fox Pitt Survey.

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There have been some other proud moments as well:

London-based Euromoney magazine gave us the award for "Best Bank - India" in 1999, "Best
Domestic Bank" in India in 2000, and "Best Bank in India" in 2001 and 2002

Asiamoney magazine has named us "Best Commercial Bank in India 2002".

For our use of information technology we have been recognized as a "Computerworld Honors
Laureate" and awarded the 21st Century Achievement Award in 2002 for Finance, Insurance &

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 Real Estate category by Computerworld, Inc., USA.

Our technology initiative has been included as a case study in their online global archives.The
Economic Times has conferred on us The Economic Times Awards for Corporate Excellence as
the Emerging Company of the Year 2000-01.

Leading Indian business magazine Business India named us "India's Best Bank" in 2000.

In the year 2000, leading financial magazine Forbes Global named us in its list of "The 300 Best
Small Companies" in the world and as one of the "20 for 2001" best small companies in the
world.

We are aware that all these awards are mere milestones in the continuing, never-ending journey of
providing excellent service to our customers. We are confident, however, that with your feedback
and support, we will be able to maintain and improve our services.

CORPORATE GOVERNANCE

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HDFC Bank recognizes the importance of good corporate governance, which is generally
accepted as a key factor in attaining fairness for all stakeholders and achieving
organizational efficiency. This Corporate Governance Policy, therefore, is established to
provide a direction and framework for managing and monitoring the bank in accordance
with the principles of good corporate governance.

Code of Corporate Governance

The Bank believes in adopting and adhering to best recognized corporate governance
practices and continuously benchmarking itself against each such practice. The Bank
understands and respects its fiduciary role and responsibility to shareholders and strives
hard to meet their expectations. The Bank believes that best board practices, transparent
disclosures and shareholder empowerment are necessary for creating shareholder value.

The Bank has infused the philosophy of corporate governance into all its activities. The
philosophy on corporate governance is an important tool for shareholder protection and
maximization of their long-term values. The cardinal principles such as independence,
accountability, responsibility, transparency, fair and timely disclosures, credibility etc.
serve as the means for implementing the philosophy of corporate governance in letter and
spirit.

Corporate Governance Rating

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The bank was amongst the first four companies, which subjected itself to a Corporate
Governance and Value Creation (GVC) rating by the rating agency, The Credit Rating
Information Services of India Limited (CRISIL). The rating provides an independent
assessment of an entity's current performance and an expectation on its "balanced value
creation and corporate governance practices" in future. The bank has been assigned a
'CRISIL GVC Level 1' rating for the second consecutive year, which indicates that the
bank's capability with respect to wealth creation for all its stakeholders while adopting
sound corporate governance practices is the highest.

Composition of the board

The Composition of the Board of Directors of the Bank is governed by the Companies
Act, 1956, the Banking Regulation Act, 1949 and the listing requirements of the Indian
Stock Exchanges where the securities issued by the Bank are listed. The Board has
strength of 9 Directors as on March 31, 2007. All Directors other than Mr Aditya Puri are
non-executive directors. The Bank has four independent directors and five non-
independent directors. The Board consists of eminent persons with considerable
professional expertise and experience in banking, finance, agriculture, small-scale
industries and other related fields.

Board Committees
The Board has constituted committees of Directors to take informed decisions in the best
interest of the Bank. These committees monitor the activities falling within their terms of
reference. Various committees of the Baord were reconstituted during the year due to
resignation of Mr. Bobby Parikh and induction of additional directors namely; Mr. C. M.
Vasudev and Mr. Gautam Divan

The Board's Committees are as follows:

Page 25
  Audit and Compliance Committee
 Compensation Committee
 Investors' Grievance (SHARE) Committee
 Risk Monitoring Committee
 Credit Approval Committee
 The Premises Committee
 Nomination Committee
 Fraud Monitoring Committee
 Customer Service Committee
 Audit and Compliance Committee

Audit and Compensation Committee

The Audit and Compliance Committee of the Bank is chaired by Mr. Arvind Pande. The
other members of the Committee are Mr. Ashim Samanta, Mr. C. M. Vasudev and Mr
Gautam Divan. Mr. Bobby Parikh and Dr. V. R. Gadwal ceased to be members of the
Committee w. e. f. October 17, 2006 and March 14, 2007 respectively. Mr. C. M.
Vasudev and Mr. Gautam Divan were inducted as members of the Committee w.e.f.
October 17, 2006. All the members of the Committee are independent directors and Mr.
Gautam Divan is a financial expert.

The Committee met 9 (nine) times during the year.

Clause 49 of the Listing Agreement entered into with the Stock Exchanges in India, and
inter-alia includes the following:

Overseeing the Bank's financial reporting process and ensuring correct, adequate and
credible disclosure of financial information;

Compensation Committee

Page 26
The Compensation Committee reviews the overall compensation structure and policies of
the Bank with a view to attract, retain and motivate employees, consider grant of stock
options to employees, reviewing compensation levels of the Bank's employees vis-a-vis
other banks and industry in general.

The Bank's compensation policy is to provide a fair and consistent basis for motivating
and rewarding employees appropriately according to their job / role size, performance,
contribution, skill and competence.

Mr. Jagdish Capoor, Mr. Ashim Samanta and Mr. Gautam Divan are the members of the
Committee.

Mr. Bobby Parikh and Dr. V. R. Gadwal ceased to be members of the Committee w. e. f.
October 17, 2006 and March 14, 2007 respectively. Mr. Jagdish Capoor chairs the
Committee. All the members of the Committee other than Mr. Capoor are independent
directors.

The Committee met 3 (three) times during the year.

Investors' Grievance (SHARE) Committee

The Committee approves and monitors transfer, transmission, splitting and consolidation
of shares and bonds and allotment of shares to the employees pursuant to Employees
Stock Option Scheme. The Committee also monitors redressal of complaints from
shareholders relating to transfer of shares, non-receipt of Annual Report, dividends etc.

The Committee consists of Mr. Jagdish Capoor, Mr. Aditya Puri and Mr Gautam Divan.
Mr. Gautam Divan was inducted as member of the Committee w.e.f. October 17, 2006.

The Committee is chaired by Mr. Capoor and met 13 times during the year. The powers
to approve share transfers and dematerialisation requests have been delegated to
executives of the Bank to avoid delays that may arise due to non-availability of the
members of the Committee.

Page 27
As on March 31, 2007, 54 instruments of transfer representing 4571 shares were pending
and since then the same have been processed. The details of the transfers are reported to
the Board of Directors from time to time.

During the year, the Bank received 206 complaints from shareholders, which have been
attended to.

Risk Monitoring Committee

The committee has been formed as per the guidelines of Reserve Bank of India on the
Asset Liability Management / Risk Management Systems. The Committee develops
Bank's credit and market risk policies and procedures, verify adherence to various risk
parameters and prudential limits for treasury operations and reviews its risk monitoring
system. The committee also ensures that the Bank's credit exposure to any one group or
industry does not exceed the internally set limits and that the risk is prudentially
diversified.

The Committee consists of Mrs. Renu Karnad, Mr. Aditya Puri and Mr. C. M. Vasudev
and is chaired by Mrs. Renu Karnad. Mr. Bobby Parikh ceased to be member of the
Committee w.e.f. October 17, 2006 and Mrs. Renu Karnad was inducted as Chairperson
of the Committee on October 17, 2006.

The Committee met 6 (six) times during the year.

Credit Approval Committee

The Credit Approval Committee approves credit exposures, which are beyond the powers
delegated to executives of the Bank. This facilitates quick response to the needs of the
customers and speedy disbursement of loans. The Committee consists of Mr. Jagdish
Capoor, Mr. Aditya Puri, Mr. KekiMistry and Mr Gautam Divan. The Committee is
chaired by Mr. Capoor.

The Committee met 2 (two) times during the year.

Page 28
The Premises Committee

The Premises Committee approves purchases and leasing of premises for the use of
Bank's branches, back offices, ATMs and residence of executives in accordance with the
guidelines laid down by the Board. The committee consists of Mr. Aditya Puri, Mr.
Ashim Samanta and Mrs. Renu Karnad. Dr. V. R. Gadwal ceased to be member and
chairman of the Committee w. e. f. March 14, 2007.

The Committee is chaired by Mrs. Renu Karnad.

The Committee met 3 (three) times during the year.

Nomination Committee

The Bank has constituted a Nomination Committee for recommending the appointment
of independent / non-executive directors on the Board of the Bank. The Nomination
Committee scrutinises the nominations for independent / non-executive directors with
reference to their qualifications and experience. For identifying 'Fit and Proper' persons,
the Committee adopts the following criteria to assess competency of the persons
nominated: Corporate Governance HDFC Bank Limited Annual Report 2006-07

Academic qualifications, previous experience, track record and Integrity of the candidates

For assessing the integrity and suitability, features like criminal records, financial
position, civil actions undertaken to pursue personal debts, refusal of admission to and
expulsion from professional bodies, sanctions applied by regulators or similar bodies and
previous questionable business practice are considered.

The members of the Committee are Mr. Arvind Pande and Mr. Ashim Samanta. Dr. V. R.
Gadwal ceased to be member of the committee w.e.f. March 14, 2007. All the members
of the Committee are Independent directors.The Committee met 3 (three) times during
the year

Page 29
Fraud Monitoring Committee

Pursuant to the directions of the Reserve Bank of India, the Bank has constituted a Fraud
Monitoring Committee, exclusively dedicated to the monitoring and following up of
cases of fraud involving amounts of Rs.1 crore and above. The objective of this
Committee is the effective detection of frauds and immediate reporting thereof to
regulatory and enforcement agencies and actions taken against the perpetrators of frauds.
The terms of reference of the Committee are as under:

Customer Service Committee

The Committee monitors the quality of services rendered to the customers and also
ensures implementation of directives received from RBI in this regard. The terms of
reference of the Committee are to formulate comprehensive deposit policy incorporating
the issues arising out of death of a depositor for operations of his account, the product
approval process, the annual survey of depositor satisfaction and the triennial audit of
such services.

The members of the Committee are Mr. Keki Mistry and Mr. Arvind Pande. Dr. Venkat
Rao Gadwal ceased to be member of the Committee w. e. f. March 14, 2007.

The Committee met 4 (four) times during the year.

Ownership Rights

Certain rights that a shareholder in a company enjoys:

 To transfer the shares
 To receive the share certificates upon transfer within the stipulated period
prescribed in the Listing Agreement
 To receive notice of general meetings, annual report, the balance sheet and profit
and loss account and the auditors' report.

Page 30
  To appoint proxy to attend and vote at the general meetings. In case the member
is a body corporate, to appoint a representative to attend and vote at the general
meetings of the company on its behalf.
To attend and speak in person, at general meetings. Proxy cannot vote on show of
hands but can vote on a poll.
 To vote at the general meeting on show of hands wherein every shareholder has
one vote. In case of vote on poll, the number of votes of a shareholder is
proportionate to the number of equity shares held by him.

As per Banking Regulation Act, 1949, the voting rights on a poll of a shareholder of a
banking company are capped at 10% of the total voting rights of all the shareholders of
the banking company.

To demand poll alongwith other shareholder(s) who collectively hold 5,000 shares or are
not less than 1/10th of the total voting power in respect of any resolution.

To requisition an extraordinary general meeting of any company by shareholders who

collectively hold not less then 1/10th of the total paid-up capital of the company.

To move amendments to resolutions proposed at meetings.

To receive dividend and other corporate benefits like rights, bonus shares etc. as and
when declared / announced.

To inspect various registers of the company.

To inspect the minute books of general meetings and to receive copies thereof after
complying with the procedure prescribed in the Companies Act, 1956.

To appoint or remove director(s) and auditor(s) and thus participate in the management
through them.

Page 31
To proceed against the company by way of civil or criminal proceedings.

To apply for the winding-up of the company.

To receive the residual proceeds upon winding up of a company.

Promoters’ Right

The Memorandum and Articles of Association of the Bank provides the following
rights to HDFC Limited:

The Board shall appoint non-retiring Directors from amongst the Directors nominated by
HDFC Limited with the approval of shareholders, so long as HDFC Limited and its
subsidiaries, singly or jointly hold not less than 20% of the paid-up share capital of the
Bank.

HDFC Limited shall nominate either a part-time Chairman and the Managing Director or
a full time Chairman, with the approval of the Board and the shareholders so long as
HDFC Limited and its subsidiaries, singly or jointly hold not less than 20% of the paid-
up share capital of the Bank.

Under the terms of our organisational documents, HDFC Limited has a right to nominate
two directors who are not required to retire by rotation, so long as HDFC Limited, its
susbsidiaries or any other company promoted by HDFC Limited either singly or in the
aggregate holds not less than 20% of paid up equity share capital of the Bank. The two
directors so nominated by HDFC Limited are the Chairman and the Managing Director.

Share Transfer Process

The bank's shares which are in compulsory dematerialised (demat) list are transferable
through the depository system. Shares in physical form are processed by the Registrars
and Share Transfer Agents, MCS Limited and approved by the Investors' Grievance

Page 32
(Share) Committee of the bank. The share transfers are processed within a period of 8
days from the date of receipt of the transfer documents by MCS Limited.

Key Shareholders Rights

HDFC Limited, Bennett, Coleman & Co. Ltd. and its group companies (the promoters of
erstwhile Times Bank Limited) and Chase Funds had entered into a tripartite agreement
dated November 26, 1999 for effecting amalgamation of Times Bank Limited with the
Bank. Under this Agreement, Bennett Coleman Group has a right to nominate one
Director on the Board of the Bank as long as its holding exceeds 5% of the share capital
of the Bank. Currently, as on March 31, 2007, the Bennett Coleman Group holds 5.15%
of the share capital of the Bank and Mr. Vineet Jain represents the group on the Board of
the Bank.

Dividend Policy

Your Bank has had a track record of moderate but steady increases in dividend
declarations for the last 10 years and dividend payout ratio in the last few years has been
in the range of 20-25 %. Your Bank's dividend policy is based on the need to balance the
twin objectives of appropriately rewarding shareholders with cash dividends and of
retaining capital to maintain a healthy capital adequacy ratio to support future growth. In
line with this policy and recognition of healthy performance during 2006-07, your
directors pleased to recommend a dividend of 70% for the year ended on March 31,2007
as against 55% for the year ended March, 31,2006. This dividend shall be subject to
distribution tax to be paid by the Bank but will be tax- free in the hands of the members.

Applications for loans and their processing

The bank would have loan application forms for retail advances and credit cards. These
would include information about the fees/charges, if any, payable for processing, the
amount of such fees refundable in the case of non acceptance of application, pre-payment

Page 33
options and any other matter which affects the interest of the borrower, so that a
meaningful comparison with that of other banks can be made and an informed decision
can be taken by the borrower

As part of the wholesale banking business, the bank has various segments to which credit
facilities are provided for their business requirements. These include a wide range of
customers and range from small & medium enterprises to large corporate borrowers. The
bank has a process for identification of target customers to whom facilities can be
provided based on customer selection and risk assessment for that segment. Thus, the
focus is on contacting prospective customers and encouraging them to avail of banking
services from HDFC Bank based on the incremental value we can add to a customer's
business, rather than customers making applications to the Bank for facilities / services.
Thus, for the wholesale banking segment, we do not have any standardized application
forms to be submitted by prospective customers.

The bank would give an acknowledgement for receipt of all retail loan applications. Time
frame within which loan applications will be processed would be indicated in the
acknowledgement of such applications

The bank would verify the loan applications within a reasonable period of time. If
additional details / documents are required, it would intimate the borrowers immediately

In the case of all borrowers seeking loans, the bank would convey in writing, the main
reason/reasons which, in the opinion of the bank after due consideration, have led to
rejection of the loan applications. In case the proposal does not meet the internal risk
parameters of the bank, the borrower would be intimated accordingly.

Loan appraisal and terms/conditions

The bank would ensure that there is proper assessment of credit application made by
borrowers. The assessment would be in line with the bank's credit policies & procedures
and relevant regulatory guidelines

Page 34
The bank would convey to the borrower the credit limit along with the terms and
conditions thereof and obtain the borrower's acceptance of these terms and conditions,
given with his full knowledge on record.

In respect of approved credit proposals, terms and conditions and other caveats governing
credit facilities given by the bank would be reduced in writing and duly certified by a
bank official. A copy of the loan agreement along with a copy each of all enclosures
quoted in the loan agreement may be furnished to the borrower if asked for.

The sanction letter or the loan agreement would stipulate if the credit facilities are solely
at the discretion of the bank. The bank may disallow facilities that involve drawings
beyond the sanctioned limits, honouring cheques issued for the purpose other than
specifically agreed to in the credit sanction, and drawing on a borrowal account on its
classification as a non-performing asset or on account of non-compliance with the terms
of sanction. Further the bank does not have an obligation to meet additional requirements
of the borrowers on account of growth in business etc. without proper review of credit
limits. Any increase/additional limits/changes in facilities requested by the customer
would be considered by the Bank based on its internal policies and assessment and the
Bank is not under any obligation to accede to the specific request of the borrower.

In the case of lending under consortium arrangement, the bank would endeavour to
evolve procedures to complete appraisal of proposals in a time bound manner to the
extent feasible, and communicate its decisions on financing or otherwise within a
reasonable time, in co-ordination with other members of the consortium

Disbursement of loans including changes in terms and conditions  

The bank would ensure timely disbursement of loans sanctioned in conformity with the
terms and conditions governing such sanction. It would give notice of any change in the
terms and conditions including interest rates, service charges etc.

Page 35
Revisions to the Bank's PLR are notified through the Bank's website. They are also
covered in leading financial newspapers. Any revisions in this are applicable to all PLR
linked facilities from the date of PLR revision. For facilities linked to other benchmark
rates, these are revised as per prior agreement with the customer, the process for which is
covered in the sanction letter duly accepted by the customer on the loan agreement. For
all other facilities, any change in interest rates is with prior intimation to the customer.
All revisions in other fees and charges are also informed to the customer in advance.

Page 36
ACCOUNTS AND DEPOSITS

Banking should be effortless. With HDFC Bank, the efforts are rewarding. No matter
what a customer's need and occupational status, we have a range of solutions that are
second to none.

Whether you're employed in a company and need a simple Savings account or run your
own business and require a robust banking partner, HDFC Bank not only has the perfect
solution for you, but also can recommend products that can augment your planning for
the future.

Savings Accounts

These accounts are primarily meant to inculcate a sense of saving for the future,
accumulating funds over a period of time. Whatever your occupation, we are confident
that you will find the perfect banking solution. Open an account in your name or register
for one jointly with a family member today.

Regular Salary
Savings Plus  Classic
SavingsMax  Payroll
No Frills  Regular
Retail Trust    Premium
Kids Advantage    Defence
Pension Savings   Reimbursement
Family Savings Kisan No Frills Savings
Kisan Club Savings    
 

Page 37
 Current Accounts

Now, with an HDFC Bank Current Account, experience the freedom of multi-city
banking! You can have the power of multi-location access to your account from any of
our 684 branches in 316 cities. Not only that, you can do most of your banking
transactions from the comfort of your office or home without stepping out.

We make it our business to help you with your business by offering you a Current
Account with all the benefits you need to stay ahead of your competition.

At HDFC Bank, we understand that running a business requires time and money, also
that your business needs are constantly evolving. That's where we come in. We provide
you with a choice of Current Account options to exclusively suit your business –
whatever the size or scope.

Open an HDFC Bank Current Account & control your business operations centrally.

Plus Trade Premium

Regular RFC Domestic
 
Choose the product most suitable for you:

Fixed Deposits

Long-term investments form the chunk of everybody's future plans. An alternative to

simply applying for loans, fixed deposits allow you to borrow from your own funds for a
limited period, thus fulfilling your needs as well as keeping your savings secure.

Page 38
 Regular Fixed Deposit SuperSaver Sweep-In
5 Year Tax Saving Fixed Deposit

As per the Finance Bill 2007, all fees and charges mentioned above will attract Service
Tax @ 12% and Education Cess @ 3% of the service tax amount effective 11th May
2007. The same will appear as separate debits in the statements.

REGULAR SAVINGS ACCOUNTS

An easy-to-operate savings account that allows you to issue cheques, draw Demand
Drafts and withdraw cash. Check up on your balances from the comfort of your home or
office through NetBanking, PhoneBanking and MobileBanking.
Need money urgently? Withdraw cash from any of the 1,740 ATM centres spread
across the country.All you have to do is to maintain Average Quaterly Balance of Rs.
2,500/- each in semi urban city or Rs 5,000/- each in the urban city.

Features & Benefits

Wide network of branches and over thousand ATMs to meet all your banking needs
no matter where you are located.

Bank conveniently with facilities like NetBanking and MobileBanking- check your
account balance, pay utility bills or stop cheque payment, through SMS.

Never overspend- Shop using your International Debit Card that reflects the actual
balance in your savings account.

Personalised cheques with your name printed on each cheque leaf for enhanced
security.

Page 39
Take advantage of BillPay, an instant solution to all your frequent utility bill
payments. Instruct for payment over the phone or through the Internet.

Avail of facilities like Safe Deposit Locker, Sweep-In and Super Saver facility on
your account.

3 Free transactions on SBI/Andhra Bank ATMs per month.

Free Payable-at-Par chequebook, without any usage charges upto a limit of

Rs.50,000/- per month.

Free InstaAlerts for all account holders for lifetime of the account.

Free Passbook facility available at home branch for account holders (individuals).

Free Email Statement facility.

Page 40
 SAVINGS PLUS ACCOUNTS

Introducing the best banking option for you with HDFC Bank Savings Plus Account.
Now you can get access to some of the finest banking facilities with HDFC Bank's
Savings Plus Account. All you have to do is maintain an Average Quarterly Balance of
Rs.10,000/- and experience the benefits as mentioned below:

Features & Benefits

Wide network of branches and over thousand ATMs to meet all your banking needs
no matter where you are located.

2 Free transactions on SBI/Andhra Bank ATMs per month.

3 Free transactions on any other Bank's ATM per month.

Free International Debit Card for all account holders for life time of the account.

Free Payable at Par (PAP) chequebook without any usage charges upto a limit of
50,000 per month.*

Free Demand Drafts on HDFC Bank locations, upto a limit of 25,000/- per day.

Free BillPay & InstaAlerts for all account holders for lifetime of the account

Free Electronic Funds Transfer facility, NetBanking, PhoneBanking &

MobileBanking

Special relationship discount on purchase of Gold Bars

25%-off on the Locker rental for the 1st year (only).

Intercity Banking / Multi-city Banking.

Free Passbook facility available at home branch for account holders (individuals).

Free Email Statement facility .

Page 41
FAMILY SAVINGS GROUP

The Family Savings Group links together upto four individual HDFC Bank accounts
(same family) under a single group. Take advantage of the group Average Quarterly
Balance (AQB) and operate your individual accounts without worrying about minimum
balance.

Features & Benefits

All account holders can operate their account freely without worrying about their
minimum balance.

Family members with NRI status can also be part of the group.

Get 5 Free Cash withdrawal transactions on SBI ATMs per group per month.

Upto 2 free DD's/ MC's on HDFC Bank locations per account per month (max. up to
Rs. 25,000/- per instrument per day).

Free International Debit Card for all account holders till the account is part of the
Family group. (NRO Accounts will be issued only ATM cards)

Free BillPay & InstaAlerts facility for all account holders till the account is part of
the Family Group.

Free Standing Instructions for investment into Mutual Funds.

Free OneView to access all your accounts.

Free MobileBanking, NetBanking & PhoneBanking.

Enjoy a Savings account to Savings acount sweep-in to a nominated account

(sweep-in to NRE accounts not permitted from resident / NRO accounts).

Payable-at-par facility at a nominal cost for all accounts in the family group.

Page 42
 **Available only on request at the branch.

Cash delivery @ Rs. 50/- per delivery***

Free Passbook facility available at home branch for account holders (individuals).

Free Email statements .

***Available in select cities only.

Avail Preferential pricing on:

Lockers: 25% Discount on the annual rent.

Gold Debit Card: Rs. 250/- for life for all account holders till they are a part of the
Family Savings Group.

Demat Account: 1st year Folio maintenance charges waived for all new demat
accounts opened.

HSL Trading a/c: Special Registration price of Rs. 649/- for all new HSL accounts
opened.

Forex: Charges applicable on purchase of traveller's cheques waived for Family

group customers.

Mudra Gold Bars: Special relationship discount.

Titanium Credit Card: Special one-time fee of Rs. 999/- for the primary applicant of
all a/cs grouped. Add-on cards free.

Gold Credit Card: Special one-time fee of Rs. 750/- for the primary applicant of all
a/cs grouped. Get an add-on card Free.

Silver/Value Plus Credit Card: Free for lifetime.

Page 43
REGULAR SALARY ACCOUNT

The HDFC Bank Regular Salary account is a Zero Balance account and comes with
below mentioned features and benefits.

Features & Benefits

No minimum balance required

Interest at the applicable savings account rate

Free International Debit card with ATM cash withdrawal limit of up to Rs. 15,000 and
Rs. 25,000 (non-cash) at shopping avenues.

Free issuance of Demand Drafts up to Rs. 25,000 per instrument, payable at branches
within the HDFC Banking network.

Free Net Banking, Phone Banking, Mobile Banking

Free Sweep-in facility

Free inter-city/branch banking.

Safe Deposit Lockers (subject to availability)

Quarterly statements

Free Monthly email statements (optional)

Free Payable at Par Chequebook

Preferential rates on loan products offered by the bank

Preferential rates on forex transactions

Billpay facility

Free InstaAlert facility

Free Passbook facility available at home branch for account holders (individuals)

Page 44
 KIDS ADVANTAGE ACCOUNT

Start saving for your child today and secure his/her future. Open Savings Account and
transfer money every month into his/her Kids Advantage Account. Watch the savings
grow as your child grows. The accumulated savings in the Kids Advantage Account can
over the years help in meeting your child's needs.

Features & Benefits

Builds up savings for your child's future.

Automatically increases the balance in your Kids Advantage Account by transferring

a fixed sum from your Savings Account every month.

Amounts in excess of Rs. 5,000/- over and above a balance of Rs. 10,000/- gets
converted into Fixed Deposits for a specified period in your child's name.

Free International Debit Card for your child (above 7 years of age) with a maximum
drawing capability of Rs. 2,500/- per day.

Free Education Insurance cover of up to Rs. 1, 00,000/- for your child with every Kids
Advantage Account.

Net Banking facility to monitor both, your Savings Account as well as your Kids
Advantage Account.

Free Funds Transfer between your Savings Account and your Kids Advantage
Account.

Opt for systematic Investment in Mutual Funds to plan for your childs future.

Free InstaAlerts for all account holders for lifetime of the account.

Free Passbook facility available at home branch for account holders (individuals).

Free Email Statement facility .

Page 45
 FAMILY SAVINGS GROUP

The Family Savings Group links together upto four individual HDFC Bank accounts
(same family) under a single group. Take advantage of the group Average Quarterly
Balance (AQB) and operate your individual accounts without worrying about minimum
balance.

Features & Benefits

All account holders can operate their account freely without worrying about their
minimum balance.

Family members with NRI status can also be part of the group.

Get 5 Free Cash withdrawal transactions on SBI ATMs per group per month.

Upto 2 free DD's/ MC's on HDFC Bank locations per account per month (max. up to
Rs. 25,000/- per instrument per day).

Free International Debit Card for all account holders till the account is part of the
Family group. (NRO Accounts will be issued only ATM cards)

Free BillPay & InstaAlerts facility for all account holders till the account is part of the
Family Group.

Free Standing Instructions for investment into Mutual Funds.

Free OneView to access all your accounts.

Free MobileBanking, NetBanking & PhoneBanking.

Enjoy a Savings_account sweep-in to a nominated account (sweep-in to NRE

accounts not permitted from resident / NRO accounts).

Payable-at-par facility at a nominal cost for all accounts in the family group.**

Page 46
 **Available only on request at the branch.

Cash delivery @ Rs. 50/- per delivery***

Free Passbook facility available at home branch for account holders (individuals).

Free Email statements.

***Available in select cities only.

Avail Preferential pricing on:

Lockers: 25% Discount on the annual rent.

Gold Debit Card: Rs. 250/- for life for all account holders till they are a part of the
Family Savings Group.

Demat Account: 1st year Folio maintenance charges waived for all new demat
accounts opened.

HSL Trading a/c: Special Registration price of Rs. 649/- for all new HSL accounts
opened.

Forex: Charges applicable on purchase of traveller's cheques waived for Family

group customers.

Mudra Gold Bars: Special relationship discount.

Titanium Credit Card: Special one-time fee of Rs. 999/- for the primary applicant of
all a/cs grouped. Add-on cards free.

Gold Credit Card: Special one-time fee of Rs. 750/- for the primary applicant of all
a/cs grouped. Get an add-on card Free.

Silver/Value Plus Credit Card: Free for lifetime.

Page 47
 DEMAT ACCOUNT

HDFC BANK is one of the leading Depository Participant (DP) in the country with over
8 Lac demat accounts. HDFC Bank Demat services offers you a secure and convenient
way to keep track of your securities and investments, over a period of time, without the
hassle of handling physical documents that get mutilated or lost in transit.

HDFC BANK is Depository participant both with -National Securities Depositories

Limited (NSDL) and Central Depository Services Limited (CDSL).

Features & Benefits

As opposed to the earlier form of dealing in physical certificates with delays in

transaction, holding and trading in Demat form has the following benefits:

Settlement of Securities traded on the exchanges as well as off market transactions.

Shorter settlements thereby enhancing liquidity.

Pledging of Securities.

Electronic credit in public issue.

Auto credit of Rights / Bonus / Public Issues / Dividend credit through ECS.

Auto Credit of Public Issue refunds to the bank account.

No stamp duties on transfer of securities held in demat form.

No concept of Market Lots.

Change of address, Signature, Dividend Mandate, registration of power of attorney,

transmission etc. can be effected across companies held in demat form by a single
instruction to the Depository Participant (DP).

Holding / Transaction details through Internet / email.

Page 48
 REGULAR CURRENT ACCOUNT

A Current account is ideal for carrying out day-to-day business transactions. With the
HDFC Bank Regular Current Account, you can access your account anytime, anywhere,
pay using payable at par cheques or deposit cheque at any HDFC bank branch. It also
facilitates FREE NEFT transactions & FREE RTGS collections for faster collections in
your account. Regular Current Account requires you to maintain an average quarterly
balance of only Rs. 10,000.

With a vast network of branches in cities all over the country, and access to a multitude
of ATM's, you can keep track of all your transactions anytime.

Features & Benefits

Convenient inter-city banking:

Deposit your local cheques in one branch of a city and have it credited to your account
at a branch in another city or make payments across HDFC Bank locations using PAP
cheque facility at a nominal rate

Free payments and collections through NEFT

Free RTGS collection. RTGS payment @ Rs.100/- per transaction

Inter-city Account to accounts funds transfer between HDFC Bank accounts at a

nominal charge of Rs.15/- per transactions

Free Demand Drafts (DD) above Rs.1,00,000/-. Demand drafts up to Rs.50,000/- at

flat cost of Rs.40/-. DDs above Rs.5,000/- & up to Rs.100,000/- at nominal cost of
Rs.25/-.

Page 49
 Free Pay Order (PO) above Rs.1,00,000/-. Pay Order up to Rs.50,000/- at flat cost of
Rs.40/-. POs above Rs.5,000/- & up to Rs.100,000/- at nominal cost of Rs.25/-.

Payable at par chequebook at nominal price.

Register for InstaAlert service and receive updates on your account as and when the
select transaction happens - all this without visiting the branch or ATM!

Enjoy facilities like 24-hour Phone Banking, Net Banking and Mobile Bankingss that
helps you check your balance & transaction details find out the status of your cheque
or stop cheque payment.

TRADE CURRENT ACCOUNT

In today's changing business requirements, you need to transfer funds across cities, and
time is of the essence. HDFC Bank Trade Current Account gives you the power of inter-
city banking with a single account.

From special cheques that get treated at par with local ones in any city where we have a
branch, to free account to account funds transfer between HDFC Bank accounts, to free
inter-city clearing of up to 50 lakhs per month, our priority services have become the
benchmark for banking efficiency. Trade Current Account requires you to maintain an
average quarterly balance of Rs. 40,000.

Read on to know the powerful features of the HDFC Bank Trade Current Account.

Features & Benefits

Free Account to account funds transfer between HDFC Bank accounts.

Free RTGS/NEFT Transactions.

Page 50
 Free up to 30 Demand Drafts (DD) per month and can be issued from any HDFC
Bank Branch.

Free up to 30 Pay Orders (PO) per month and can be issued from any HDFC Bank
Branch.

Free anywhere collection & payment within HDFC Bank branch network (except
Dahej), up to Rs.50 lacs per month.

Convenience to withdraw & deposit cash at all our branches*

200 "At Par" cheque leaves per free month .

Register for InstaAlert service and receive updates on your account as and when the
select transaction happens - all this without visiting the branch or ATM!

Enjoy facilities like 24-hour PhoneBanking, NetBanking and MobileBanking that

helps you check your balance & transaction details, find out the status of your cheque
or stop cheque payment.

REGULAR FIXED DEPOSIT

If you believe in long-term investments and wish to earn higher interests on your savings,
NOW is the time to invest your money in our Fixed Deposit. Get upto 9.00% on HDFC
Bank Fixed Deposit with an additional 0.50% for Senior Citizens. What's more NO
PENALTY if you withdraw part of the FD in times of need.

Flexibility, Security and High Returns all bundled into one offering.
Check out the rates and book an FD TODAY!! NetBanking Users can login and book
their Fixed Deposit online immediately.

Features & Benefits

Page 51
Time based rate of interest- longer periods of deposit accrue higher interests.

Potential to earn compound interest by reinvesting the principal amount along with the
interest earned during the period.

Add to your Fixed Deposit. (Minimum add-ons of Rs. 5,000/-) when you have surplus
funds.

No penalty for premature withdrawal.

Flexibility in altering period of deposit, maturity and payment instructions, principal

amount and rollover mode.

Higher rate of interest on Fixed Deposits for Senior Citizens.

Page 52
 FIVE YEAR TAX SAVING FIXED DEPOSIT

Fixed Deposits at one time were the most popular investment avenues.
However with the changing market scenario-booming financial markets, FDs lost their
sheen.

However today they have once again become attractive!! In 2006, it was announced for
the first time that Bank fixed deposits booked by an Individual/HUF for 5 years & upto
Rs. 1,00,000/- will be allowed exemption under Sec 80C of the Income Tax Act,1961
subject to necessary declarations taken from the Customer.

Features & Benefits

Minimum Amount: Rs.100/-

Multiples of Rs.100/-

Maximum Amount: Rs. 1 lac (in a FY)

Tenure - 5 years (lock in period).

Rate of Interest - 8.25% p.a, Senior Citizen rate - 8.75%

No Partial/Premature withdrawal allowed.

Sweep-in not allowed.

No OD or pledge allowed.

Relationship pricing on other products.

In the case of joint holder deposit, the deduction from income under section 80C of
the Act shall be available only to the first holder of the deposit.

Page 53
 SUPERSAVER FACILITY

Enjoy a high rate of interest along with the liquidity of a Savings Account by opting for a
SuperSaver Facility on your savings account. Avail of an overdraft facility of up to 75%
of the value of your Fixed Deposit.

Get the best of both worlds.

Features & Benefits

It's like two Accounts working in tandem to give you better returns.

Choose between a Savings Account or Current Account to link to your Fixed Deposit.

Avail an overdraft facility to supplement your household or business needs.

Pay back with interest only on the drawn amount, while the remaining Fixed Deposit
continues to earn you interest.

Flexibility in altering period of deposit, maturity and payment instructions, principal

amount and rollover mode.

Senior citizens enjoy a higher rate of interest on their Fixed Deposits.

Page 54
 HDFC BANK- SWOT ANALYSIS

Summary

The HDFC Bank Limited

 SWOT Analysis Company Profile is the essential source for top-level company
data and information. The report examines the company's key business structure
and operations, history and products, and provides summary analysis of its key
revenue lines and strategy.

HDFC Bank specializes in the provision of banking and other financial services to
corporate and institutional clients. The company's services include commercial,
transactional and electronic banking products. It also provides treasury services, retail
banking and capital markets infrastructure. The company primarily operates in India.
HDFC Bank is headquartered in Mumbai, India and employs about 14,900 people. The
company recorded revenues of INR 36,054.1 million (approximately $810.5 million)
during the fiscal year ended March 2006, an increase of 49% over 2005. The net profit
was INR9,187.1 million (approximately $206.5 million) in fiscal year 2006, an increase
of 39% over 2005.

Scope of the Report

 Provides all the crucial company information required for business and competitor
intelligence needs
 Contains a study of the major internal and external factors affecting the company
in the form of a SWOT analysis as well as a breakdown and examination of
leading product revenue streams
 Data is supplemented with details on the company's history, key executives,
business description, locations and subsidiaries as well as a list of products and
services and the latest available company statement

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Reasons to Purchase
 Support sales activities by understanding your customers' businesses better
 Qualify prospective partners and suppliers
 Keep fully up to date on your competitors' business structure, strategy and
prospects
 Obtain the most up to date company information available

HDFC Bank - A Company Profile

R4B's HDFC Bank Company Profile is the essential source for top-level company data
and information. The report examines the company’s key business structure and
operations, history and products, and provides summary analysis of its key revenue lines
and strategy.

Scope of the Report

• Provides all the crucial company information required for business and competitor
intelligence needs
• Contains a study of the major internal and external factors affecting the company in the
form of a SWOT analysis as well as a breakdown and examination of leading product
revenue streams
• Data is supplemented with details on the company’s history, key executives, business
description, locations and subsidiaries as well as a list of products and services and the
latest available company statement

Page 56
HDFC Bank Limited (ADR)

 
Related Companies
Name Symbol  Last Trade Change Mkt Cap
HDFC Bank Limited        
+1.03
ICICI Bank Limited (ADR) IBN 48.02 21.68B
(2.19%)
ING Vysya Bank Limited        
Housing Development Finance
       
Corporation
ICICI Bank Limited        
State Bank of India        
Industrial Development Bank of
       
India
Karur Vysya Bank Limited        
Punjab National Bank        
Bank of India        
Sector: Financial >  Industry: Money Center Banks
 
Financials
 (In millions of INR)

Quarterly Annual Annual

Income Statement (May 11) (2010) (2009)
Net Income 3,212.30 11,039.70 9,187.10

Balance Sheet
Total Assets 1,056,952.60 1,013,185.90 790,969.40
Total Liabilities 975,983.40 947,677.80 735,701.90
Total Equity 80,969.20 65,508.10 55,267.50

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Cash Flow
Net Income/Starting Line - 11,039.70 9,187.10
Cash from Operating - 33,829.10 32,616.10
Cash from Investing - -176,461.00 -227,387.30
Cash from Financing - 161,984.00 218,389.70
Net Change in Cash - 19,352.10 23,618.50
 
Key Stats & Ratios
Quarterly Annual Annual
(Jun '07) (2007) (TTM)
Net Profit Margin 20.62% 21.38% 21.35%
Operating Margin 30.59% 31.28% 31.33%

Various types of fund transfers are offered by HDFC Bank.

India Link - Money transfer made possible from Middle East through partner exchange
houses of HDFC Bank.  In 24 hrs money is credited in HDFC account of the beneficiary
or DD issued within 3 days.

Cheque Lock Box - This service is offered by HDFC Bank in US and UK.  Local
cheques can be sent to the local mail box which in turn credited into beneficiary’s HDFC
account in India with local currency cheque.

Quick Remit - This facility available for sending money from US, UK and Singapore. 
This is an online money transfer mode, the money can be credited into recipient’s HDFC
bank account across India.

Telegraphic Transfer - Money from any part of the world can be sent to beneficiary’s
HDFC Bank account with TT or wire transfer.

Traditional transfer of cheque, DD etc. are also available with HDFC bank.

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 OBJECTIVES OF THE STUDY

 To find the market share of the HDFC bank in the city

 To recognize the popular saving product

 To suggest ideal policy term of the various accounts.
 To understand the type of account preferred for savings (viz..savings
account, current account and fixed deposits
 To understand the awareness level of consumers about the various savings
products.

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 RESEARCH METHODOLOGY

Meaning of research

Research in common parlance refers to a search for knowledge. One can also define
research as a scientific and systematic search for pertinent information on a specific topic.
In fact, research is an art of scientific investigation. The Advanced Learner’s Dictionary
of current English lay down the meaning of research as “a careful investigation or
inquiry especially through search for new facts in any branch of knowledge.”
Research is an academic activity and as such the term should be used in a technical sense.
According to Clifford Woody, research comprises defining and redefining problems,
formulating hypothesis to suggested solutions; collecting, organizing and evaluating data;
making deduction and reaching conclusions; and at the last carefully testing the
conclusions.
D.Slesinger and M.Stephenson in the Encyclopedia of Social sciences define research as
“the manipulation of things, concepts or symbols for the purpose of generalizing to
extend, correct or verify knowledge, whether that knowledge aids in construction of
theory or in the practice of an Art.” Research is thus, an original contribution to the
existing stock of knowledge making for its advancement. It is the pursuit of truth with the
help of study, observation, comparison and experiment.

Types of research

The basic types of research are as follows:

i. Descriptive vs. Analytical: Descriptive research includes surveys and fact-

finding enquiries of different kinds. The major purpose of descriptive research
is description of the state of affairs as it exists at present. In social science and

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 business research we quite often use the term Ex post facto research for
descriptive research studies. The main characteristic of this method is that the
researcher has no control over the variables; he can only report what has
happened or what is happening. Most Ex post facto research projects are use
for descriptive studies in which the researchers seeks to measure such items
as, for example frequency of shopping, preference of people or similar data.
Ex Post facto studies aims include attempts by researchers to discover causes
even when they cannot control the variables. The methods of research utilized
in descriptive research are survey methods of all kinds, including comparative
and correlation methods. In analytical research on the other hand, the
researcher has to use facts or information already available and analyze these
to make a critical evaluation of the material.

ii. thus, adds to the already existing organized body of scientific knowledge.

iii.Quantitative vs. Qualitative: Quantitative research is based on the measurement

of quantity or amount. It is applicable to phenomenon that can be expressed in terms
of quantity. Qualitative research, on the other hand, is concerned with qualitative
phenomenon, i.e., phenomenon relating to or involving quality or kind. For instance,
when we are interested in investigating the reasons for human behavior (i.e., why
people think or do certain things). We quite often talk of ‘Motivation Research’, an
important type of qualitative research. This type of research aims at discovering the
underlying motives and desires, using in depth interviews for the purpose. Other
techniques of such research are world associations tests, sentence completion tests,
story completion tests and similar other projective techniques. Qualitative research is
specially important in the behavioral sciences where the aim is to discover the
underlying motives of human behavior. Through such research we can analyze the
various factors which motivate people to behave in a particular manner or which
make people like or dislike particular thing. It may be stated, however, that to apply
qualitative research in practice is relatively a difficult job and therefore, while doing
such research, one should seek guidance from experiment psychologists.

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 RESEARCH DESIGN

Research design is simply the framework or plan for a study, which is used as a guide in
collecting and analyzing the data. It is the blue print that I followed in completing the
study. As objective of the research is descriptive in form, the research design must be
made accordingly:
 Formulating objective of the study.
 Designing the method of data collection.
 Selecting the sample size.
 Collection of data.
 Analysis and findings.
 Conclusion and inferences.
 Limitations.
 Suggestions and recommendation.

A Research Design is the framework or plan for a study, which is used as a guide in
collecting and analyzing the data collected. It is the blue print that is followed in
completing the study. The basic objective of research cannot be attained without a proper
research design. It specifies the methods and procedures for acquiring the information
needed to conduct the research effectively. It is the overall operational pattern of the
project that stipulates what information needs to be collected, from which sources and by
what methods.
This study was undertaken to identify which type of savings product should market to
particular market segments in Rishikesh. A survey was undertaken to understand the
preferences of consumers with respect to savings accounts. While marketing policies the
sole duty of an advisor/ agent is to provide various types of saving accounts as per
customer requirements.

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In effect plans (saving products) should be flexible to suit individual requirements. This
research tries to analyze some key factors which influence the opening of account like the
features of the product, terms and conditions, the type of company, the amount of annual
quarterly balance payable (capacity and willingness to spend), risk taking ability and the
influence of advertising. Solutions and recommendations are made based on qualitative
and quantitative analysis of the data.
RESEARCH PROCESS

 Formulating the problem

 Extensive literature survey
 Preparing the research design
 Determining the sample design
 Collection of data
 Analysis of data
 Preparation of reportProcedure of data collection and analysis
a) Primary data:
Primary data is that data which is collected initially for the first time. It helps in the
validation of secondary data from secondary sources. It is original in nature and it may
include the following methods:

Through personal interaction:

Almost each and every employee of the organization was personally interacted, which
gave us plenty of crucial information about their work and current status of the
organization. People disclosed their experiences when they were asked to give
suggestions. Also they told about the problems they were facing.

b) Secondary data:
Secondary data is the details that are available in the form of facts and figures. The
sources of secondary data are:
 Websites.

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  Magazines.
 Books.

Analysis:
Analysis of data is done through a process, which includes certain steps, such as follows:
 Editing.
 Coding.
 Classification.
 Tabulation.

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 LIMITATIONS OF THE STUDY

 The study was conducted only for a short period.

 The study is based on the assumption that information provided by the
respondents is true.
 The study conducted was only related to the concerned products only and it did
not necessarily related with the other products of the bank.

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 MISSION

HDFC Bank does not just mean being the largest or the most productive company in the
market; rather it is a combination of several things like:

 Customer Service of the highest order.

 Value for money for customers.
 Professionalism in carrying out business.
 Innovative products to cater to different needs of different costumers.
 Use of technology to improve service standard.
 Increasing market share.

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 VALUES

 SECURITY: Providing long term financial security to its account holders will be
the company’s constant endeavor. IT will do this by offering products.

 TRUST: HDFC Bank appreciated the trust placed by its account holders in it.
Hence, it will aim to manage their investments very carefully and live up to this
trust.

 INNOVATION: recognizing the different needs of its customers, it will be

offering a range of innovative products to meet these needs.

The company’s mission is to be the best bank in India and these are the values that will
guide it in this.

MARKETING PROBLEMS

The old and out dated technique of teal marketing is used to prospect customers. More
modern techniques must be adopted. The company must sponsor shows and give
presentations in corporate houses. The financial health check must be performed for
every prospect to assess his/her true financial position and needs. Some of the advisors
skip this vital step and the prospect ends up with a plan they do not appreciate and soon
surrender or discontinue.

Some of the main problems in marketing the policies are:

 Large amount of competition (39 players in the market).

 Other brands are well advertised and have higher recall value.
 Face competition from banks, mutual funds and insurance.
 High average quarterly balance (AQB) is high for individuals.
 Incorrect perception about savings and fixed deposits.
 Interested prospects might have a lack of time.
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 Customers get defensive if you cold call.
 Large premium amounts for various types of saving and current accounts.
 Some prospects have already opened the account and are not interested in further
opening.
 Large amount of documentation.
 Customers do not like their annual quarterly balance money locked up in the bank
account.
 Lack of awareness of the maintenance of annual quarterly balance (AQB).

RECOMMENDATIONS AND SUGGESTIONS

 Advertise about the company and its products – it motivates individuals to open
the account.
 Create a positive perception about savings, current and fixed deposits.
 The banks should target deposits and savings schemes for teenagers to inculcate
the habit of saving at young age with a constraint as to a withdrawing limit.
 Speak about the good features a product offers like high returns.
 HDFC bank should introduce more number of ATMs.
 An effort on the part of these banks is required to introduce Consolidated ATMs
in which services should be provided by making a provisions catering to offer
swipes from the ATM of other banks in order to enhance customer convenience.
 Try to sell the product/plan, which the consumer requires, and not the plan where
the advisors benefit is higher.
 Improve the efficiency in operations.
 Bring out policies with small premiums payable for short periods of time – Rs.
1000 – Rs.5000 quarterly balance.
 As per the usage of plastic money, there should be constant awareness provided to
clients regarding exploitative implication of plastic money on one’s savings.
 Promote HDFC bank as an Indian Company to build trust.
 HDFC bank could have a brand ambassador or a mascot to promote its services.

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  Should have full withdrawals from the next month onwards without maintaining
AQB.
 Tap the rural market where there is large potential.
 Any creative and innovative product to be launched by the bank should be done
catering to the needs and technology adaptability of the customers of each and
every strata.
 Diversify product portfolios.
 Make products more straightforward – reduce complexities.
 Attract the households of India with higher returns on investment, as returns are
the motivating factor.

IMPLICATIONS

Significant changes seem to be happening: -

Improvement in selling technique

More quality advertising campaign

Specifically promotion of various products

Improved investment techniques

Focus on lower and house age group customer

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DATA ANALYSIS AND FINDINGS
1. Are you aware of various services which are providing by HDFC?
a)Yes b) No
85% 15%

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2. Preference of customer to the service stations

a) Authorized b) Any one

76% 24%

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3. Most effective account to promote the consumer?

a) Salary account b) Demat account

25% 30%
c) Saving account d) Others
15% 10%

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4.. Any additional plan needed for customer?
a) Yes b) No
78% 22%

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5. Are you aware from market share?

a) Yes b) No
60% 40%

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6. Are you satisfied by HDFC plan?

a) Yes b) No

78% 22%

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7. Which account do you prefer?

a) Salary account b) saving account

C) 53% D) 47%

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8. Are you satisfied kids account builds up savings for your child's future?

a) Yes b) No

82% 18%

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9. Are you sure HDFC has best institutions ?

a)Yes b) No

67% 33%

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10. Are you sure, that you get quick service by HDFC?

a) Yes b) No

87% 13%

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Page 80
CONCLUSION

At the time of submitting this project I would like to conclude my project study with the
statement

“The customer is the most important key for any organization and to keep him satisfied
and delighted by developing more than his expectation is the first and the foremost task
of any organization lies in the efforts put in the right direction in the right time with force.
Besides this ethical working at market place and total focus on mission makes an
organization leader in the market.”

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 BIBLIOGRAPHY AND REFERENCES

 <http://www.wikipedia.com>.
 <http://www.hdfc.com>.
 <http://www.google.com>.
 Research Methodology- C.R. Kothari.
 Indian Journal of Marketing.

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