A

SYNOPSIS REPORT
ON
ASSETS AND LIABILITY MANAGEMENT
AT
HDFC BANK LIMITED
Submitted
By
ANDELA POOJA
H.T.NO: 1302-18-672-061
PROJECT SUBMITTED IN PARTIAL FULFILLMENT FOR THE AWARD OF DEGREE
OF

MASTER OF BUSINESS ADMINISTRATION

Department of Business Administration

AURORA’S PG COLLEGE
RAMANTHAPUR
(Affiliated to Osmania University)
2018-2020
INTRODUCTION
Asset Liability Management (ALM) is a strategic approach of managing the balance sheet
dynamics in such a way that the net earnings are maximized. This approach is concerned with
management of net interest margin to ensure that its level and riskiness are compatible with
the risk return objectives of the HDFC BANK LIMITED

If one has to define Asset and Liability management without going into detail about its
need and utility, it can be defined as simply “management of money” which carries value and
can change its shape very quickly and has an ability to come back to its original shape with or
without an additional growth. The art of proper management of healthy money is ASSET
AND LIABILITY MANAGEMENT (ALM).-

The Liberalization measures initiated in the country resulted in revolutionary changes in the
sector. There was a shift in the policy approach of from the traditionally administered market
regime to a free market driven regime. This has put pressure on the earning capacity of co-
operative, which forced them to foray into new operational areas thereby exposing
themselves to new risks.

As major part of funds at the disposal of come from outside sources, the management is
concerned about risk arising out of shrinkage in the value of asset, and managing such risks
became critically important to them. Although co-operative are able to mobilize deposits,
major portions of it are high cost fixed deposits. Maturities of these fixed deposits were not
properly matched with the maturities of assets created out of them.

ASSET LIABILITY MANAGEMENT is a portfolio management of assets and liability of an

organization. This is a method of matching various assets with liabilities on the basis of
expected rates of return and expected maturity patter.

In the context of ALM is defined as “a process of adjusting liability to meet loan demands,
liquidity needs and safety requirements”. This will result in optimum value of the, at the same
time reducing the risks faced by them and managing the different types of risks by keeping it
within acceptable levels.
NEED OF THE STUDY

The need of the study is to concentrates on the growth and performance of HDFC BANK
LIMITED and to calculate the growth and performance by using asset and liability
management. And to know the management of non-performing assets.

 To know financial position of HDFC BANK LIMITED

 To analyze existing situation of HDFC BANK LIMITED
 To improve the performance of HDFC BANK LIMITED
 To analyze competition between HDFC BANK LIMITED with other cooperative.
OBJECTIVES OF THE STUDY

 To study the concept of ASSET & LIABLITY MANAGEMENT in HDFC BANK

LIMITED

 To study process of CASH INFIOWS and OUTFLOWS in HDFC BANK LIMITED

 To study RISK MANAGEMENT under HDFC BANK LIMITED

 To study RESERVES CYCLE of ALM under HDFC BANK LIMITED

 To study FUNCTIONS AND OBJECTIVES of ALM committee.

SCOPE OF THE STUDY
In this study the analysis based on ratios to know asset and liabilities management under
HDFC BANK LIMITED and to analyze the growth and performance of HDFC BANK
LIMITED by using the calculations under asset and liability management based on ratio.
 Ratio analysis
 Comparative statement
 Common size balance sheet.
RESEARCH METHODOLOGY

The study of ALM Management is based on two factors.

1. Primary data collection.

2. Secondary data collection

PRIMARY DATA COLLECTION:

The sources of primary data were

 The chief manager – ALM cell

 Department Sr. manager financing & Accounting

 System manager- ALM cell

Gathering the information from other managers and other officials of the HDFC BANK
LIMITED

SECONDARY DATA COLLECTION:

Collected from books regarding, journal, and management containing relevant information
about ALM and Other main sources were

 Annual report of the HDFC BANK LIMITED

 Published report of the HDFC BANK LIMITED
 RBI guidelines for ALM.
 LITERATURE REVIEW
 P. Chidambaram53, Hon’ble(2017) Finance Minister, Government ofIndia in his
address stated that “the profitability performance of Indian Banks in recent years
compares well with that of the global benchmark banks primarily because of the
higher share of profit on the sale of investments, higher leverage and higher net
interest margins of Indian banks. However, many of these drivers of higher profits of
Indian banks may not be sustainable. To ensure long-term profitability, Indian banks
need be focused on the following parameters and build systemic capability in
managing of the same:

 MurthyGRK(2016) in his article “Credit Risk Management in a Market Driven

Economy: The Acid Test for Banks” has stated that in generic terms, risk
management can be defined as systematic identification and analysis of the various
loss exposures faced by a firm / individual and the best methods of treating the
identified loss exposures consistent with the firms’ / individuals’ objectives.
Extending the same analogy, we can define credit risk management as a process that
puts in place systems and procedures enabling a bank to

• Identify and measure the risk involved in a credit proposition, both at the
individual transaction and portfolio level,

• Evaluate the impact of exposure on Bank’s Balance Sheet / Profit.

 Rajeev A.S. (2015) in his article entitled “A primer on - Securitization” has observed
that asset securitization refers to the process by which loans, receivables and other
illiquid assets with similar characteristics in the balance sheet are packaged into
interest bearing securities that offer attractive investment opportunities. It is the
process of pooling are repackaging of homogeneous illiquid assets (primarily loans)
into marketable securities.
BIBILIOGRAPHY

Title of the Books Author

1. Risk management Gustavson hoyt

2. Donald E Fischer
Security Analysis Portfolio Management
3. Ronald J Jordan

4. Management Research magazine P.M.Dileep Kumar

5. India financial system M.Y. Khan

Web sites

www.syndicatebank.con

Www.Rbi.Org

Www.Amfiindia.Com

Www.HDFC.com

Www.Bseindia.Com

Www.Nseinda.Com

Www.Bluechipinda.Co.In