CHAPTER -1

INTRODUCTION

Page | 1
 INTRODUCTION

Banking system of a nation is the shadow of nation’s economy. A healthy and profitable banking
system is just like the backbone of nation’s economy. It is necessary for a nation to achieve
growth and remain stable in this global world and global economy. The Indian banking system,
with one of the largest banking networks in the world, has witnessed a series of reforms over the
past few years like the deregulation of interest rates, dilution of the government stake in public
sector banks (PSBs) and the increased participation of private sector banks.

1.1 History of INDIAN BANKING SYSTEM

Banking in India originated in the last decades of the 18th century. The first banks were The
General Bank of India, which started in 1786, and the Bank of Hindustan, both of which are now
defunct The oldest bank in existence in India is the State Bank of India, a government-owned
bank that traces its origins back to June 1806 and that is the largest commercial bank in the
country. Allahabad Bank, established in 1865 and still functioning today, is the oldest Joint
Stock bank in India.

Central banking is the responsibility of the Reserve Bank of India, which in 1935 formally took
over these responsibilities from the then Imperial Bank of India, relegating it to commercial
banking functions. After India's independence in 1947,the Reserve Bank was nationalized and
given broader powers. In 1969 the government nationalized the 14 largest commercial banks; the
government nationalized the six next largest in 1980.

 In 1948, the Reserve Bank of India, India's central banking authority, was nationalized, and
it became an institution owned by the Government of India.

Page | 2
 In 1949, the Banking Regulation Act was enacted which empowered the Reserve Bank of
India (RBI) "to regulate, control, and inspect the banks in India."

 The Banking Regulation Act also provided that no new bank or branch of an existing bank
could be opened without a license from the RBI, and no two banks could have common
directors

Page | 3
1.2 Liberalization in INDIAN BANKING SYSTEM

In the early 1990s, the then government embarked on a policy of liberalization, licensing a small
number of private banks. These came to be known as New Generation tech-savvy banks, and

Page | 4
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, revitalized 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 next stage for the Indian banking has been setup with the proposed relaxation in the norms
for Foreign Direct Investment, where all Foreign Investors in banks may be given voting rights
which could exceed the present cap of 10%, at present it has gone up to 49% with some
restrictions.

The new policy shook the Banking sector in India completely. Bankers, till this time, were used
to the 4-6-4 method (Borrow at 4%; Lend at 6%; Go home at 4%) of functioning. The new wave
ushered in a modern outlook and tech-savvy methods of working for traditional banks. All this
led to the retail boom in India. People not just demanded more from their banks but also received
more.

Currently (2009), banking in India is generally fairly mature in terms of supply, product range
and reach-even though reach in rural India still remains a challenge for the private sector and
foreign banks. In terms of quality of assets and capital adequacy, Indian banks are considered to
have clean, strong and transparent balance sheets relative to other banks in comparable
economies in its region. 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. One may also expect
M&As, takeovers, and asset sales. Currently, India has 88 scheduled commercial banks (SCBs) -
27 public sector banks (that is with the Government of India holding a stake), 31 private banks
(these do not have government stake; they may be publicly listed and traded on stock exchanges)

Page | 5
and 38 foreign banks. They have a combined network of over 53,000 branches and 17,000
ATMs. The public sector banks hold over 75 percent of total assets of the banking industry, with
the private and foreign banks holding 18.2% and 6.5% respectively.

1.3 The Origin of ING Group

ING group originated in 1990 from the merger between “Nationale Nederlanden” the largest
Dutch Insurance Company and “NMB Post Bank” Group. Combining roots and ambitions, the
newly formed company called Internationale Nederlanden Group ﾝ . Market circles soon
abbreviated the name to I-N-G. The company followed suit by changing the statutory name to
ING Group. ING is a global financial services company providing banking, investments, life
insurance and retirement services and operates in more than 50 countries.

PROFILE

ING is a global financial institution of Dutch origin offering banking, investments, life insurance
and retirement services. ING serve more than 85 million private, corporate and institutional
customers in Europe, North and Latin America, Asia and Australia. They draw on their
experience and expertise, their commitment to excellent service and their global scale to meet the
needs of a broad customer base, comprising individuals, families, small businesses, large
corporations, institutions and governments

STRATEGY

ING’s overall mission is to help customers manage their financial future. Capitalizing on
changing customer preferences and building on our solid business capabilities, ING’s strategic
focus is on banking, investments, life insurance and retirement services. They provide retail
customers with the products they need during their lives to grow savings, manage investments
and prepare for retirement with confidence. With wide range of products, innovative distribution
models and strong footprints in both mature and developing markets, ING has the long-run

Page | 6
economic, technological and demographic trends on their side. ING aligns its business strategy
around a universal customer ideal: saving and investing for the future should be easier. While
steering the business through turbulent times, ING will execute efforts across all its business
lines to strengthen customer confidence and meet their needs, preserve a strong capital position,
further mitigate risks and bring its costs in line with revenue expectations.

COPERATE RESPOSIBILITY
ING wants to pursue profit on the basis of sound business ethics and respect for its stakeholders.
Corporate responsibility is therefore a fundamental part of ING’s strategy: ethical, social and
environmental factors play an integral role in business decisions

1.4 FINANCIAL RESULTS

FY 2010 FY2009 FY2008 FY2007 FY2006

Income (in EUR milion)
Insurance operations 54,851 62,208 59,642 57,403 55,614
Banking operations 11,731 14,602 14,195 13,848 12,678
Total Income1 66,291 76,587 73,621 71,120 68,171
Operating Expenses

Page | 7
Insurance operations 5,422 5,515 5,275 5,195 4,746
Banking operations 10,303 9,967 9,087 8,844 8,795
Total operating expenses 15,725 15,481 14,362 14,039 13,541
Addition to loan loss provision Banking 1,280 125 103 88 465
operations
Insurance result before tax -1,635 6,533 4,935 3,978 4,322
Banking result before tax 148 4,510 5,005 4,916 3,418
Total result before tax -1,487 11,043 9,940 8,894 7,740
Taxation -721 1,534 1,907 1,379 1,709
Minority interests -38 267 341 305 276
Net result -729 9,241 7,692 7,210 5,755

Figures per ordinary share (EUR)

Net result -0.36 4.32 3.57 3.32 2.71
Earnings 2) -0.56 4.32 3.57 3.32 2.71
Dividend 0.74 1.48 1.32 1.18 1.07
Shareholders’ equity 8.55 17.73 17.78 16.96 12.95

Balance Sheet (in EUR billion)

Total assets 1,332 1.312 1,226 1,159 964
Total equity 29 40 41 38 28
Shareholders’ equity 17 37 38 37 28

Capital Ratios (%)

ING Group debt/equity ratio 13.8% 9.5% 9.0% 9.4% 10.2%
Insurance capital coverage ratio 256% 244% 274% 255% 204%
Insurance debt/equity ratio 8.5% 13.6% 14.2% 13.4% 14.3%
Bank Tier-1 ratio 9.32% 7.39% 7.63% 7.32% 6.92%
Market capitalisation (in EUR billion) 15 60 74 65 49

Page | 8
Shares (in millions):
Outstanding 2,063 2,226 2,205 2,205 2,205
Preference shares outstanding - 16 63 87 87

Key Performance Indicators

- Net return on equity (ROE) -2.1% 24.2% 23.5% 26.6% 25.4%
- Net result growth -108% 20% 7% 25% n.a.
Insurance
- Value of new life business 1,023 1,113 807 805 632
- Internal rate of return 13.9% 14.3% 13.3% 13.2% 12.1%
- Combined ratio (non-life) 97% 97% 91% 95% 94%
Banking
- Cost/income ratio 87.8% 68.3% 64.0% 63.9% 69.4%
- RAROC after tax 1.2% 19.9% 19.7% 22.6% 14.5%

Assets under management (in EUR 551 643 600 547 492
billion)

Staff (FTEs end of period) 124,661 124,634 119,801 116,614 112,195

The ING Vysya BANK Ltd.

Page | 9
The origin of the erstwhile Vysya Bank was pretty humble. It was in the year 1930 that a team of
ING Vysya Bank Ltd., is an entity formed with the coming together of erstwhile, Vysya Bank
Ltd, a premier bank in the Indian Private Sector and a global financial powerhouse, ING of
Dutch origin, during Oct 2002.

visionaries came together to form a bank that would extend a helping hand to those who weren't
privileged enough to enjoy banking services.

ING and ING Vysya Life Insurance are headquartered at Bangalore, while the corporate office of
ING Investment Management is situated at Mumbai. The synergies arising out of the three
distinct but complimentary businesses are bound to be an asset to the group in the changing
market dynamics of the future. The first such signs are already visible on the horizon with
combined products being successfully launched by the different entities of the group in
conjunction with each other

It's been a long journey since then and the Bank has grown in size and stature to encompass
every area of present-day banking activity and has carved a distinct identity of being India's
Premier Private Sector Bank.

In 1980, the Bank completed fifty years of service to the nation and post 1985; the Bank made
rapid strides to reach the coveted position of being the number one private sector bank. In 1990,
the bank completed its Diamond Jubilee year. At the Diamond Jubilee Celebrations, the then
Finance Minister Prof. Madhu Dandavate, had termed the performance of the bank stupendous.
The 75th anniversary, the Platinum Jubilee of the bank was celebrated during 2005.

The long journey of seventy-five years has had several milestones

Page | 10
1930 Set up in Bangalore

1948 Scheduled Bank

1985 Largest Private Sector Bank

1987 The Vysya Bank Leasing Ltd. Commenced

1988 Pioneered the concept of Co branding of Credit Cards

1990 Promoted Vysya Bank Housing Finance Ltd.

1992 Deposits cross Rs.1000 crores

1993 Number of Branches crossed 300

Signs Strategic Alliance with BBL., Belgium. Two National Awards by Gem & Jewellery Export
1996
Promotion Council for excellent performance in Export Promotion

Cash Management Services, & commissioning of VSAT. Golden Peacock Award - for the best HR
1998 Practices by Institute of Directors. Rated as Best Domestic Bank in India by Global Finance
(International Financial Journal - June 1998)

State -of - the -art Date Centre at ITPL, Bangalore.

2000
RBI clears setting up of ING Vysya Life Insurance Company

2001 ING-Vysya commenced life insurance business.

The Bank launched a range of products & services like the Vys Vyapar Plus, the range of loan
schemes for traders, ATM services, Smartserv, personal assistant service, Save & Secure, an account
2002
that provides accident hospitalization and insurance cover, Sambandh, the International Debit Card
and the mi-b@nk net banking service.

2002 ING takes over the Management of the Bank from October 7th , 2002

2002 RBI clears the new name of the Bank as ING Vysya Bank Ltd, vide their letter of 17.12.02

Introduced customer friendly products like Orange Savings, Orange Current and Protected Home
2003
Loans

2004 Introduced Protected Home Loans - a housing loan product

2005 Introduced Solo - My Own Account for youth and Customer Service Line – Phone Banking Service

Bank has networked all the branches to facilitate AAA transactions i.e. Anywhere, Anytime &
2006
Anyhow Banking

Page | 11
CHAPTER-2

REVIEW OF
LITRATURE

Page | 12
 2.1 REVIEW OF LITRATURE

Types of saving accounts offered by ING Vysya Bank

A)ORANGE SAVINGS ACCOUNT:

This account is the basic product of ING Vysya Bank. In this account minimum cash balance
required to open an account & the Quarterly Average Balance requirement is Rs5000. Some of
the major features and benefits of this account are:

FREE
• Free issue of International Debit Card.
• Unlimited ATM transactions at over 25,000 (Cirrus/Cashnet) ATM’s in India, where
QAB is maintained.
• Shopping convenience at over 2 Lakh merchant locations, with the ING Vysya
International Debit card.

Page | 13
 • Unlimited ATM transactions at over 196 ING Vysya ATM’s.
• 2 Demand Drafts with a value not exceeding Rs.50,000 per annum, where QAB is
maintained.
• Unlimited usage of payable at par (PAP) Cheques.

• Transfer of funds across all branches.

• National Electronic Funds Transfer (NEFT) through the internet banking channel.
• Electronic Bill Payment service.
• Smartserv - Personal Assistance Service.

• Statement of Account through E-mail.

• Mi-b@nk - Internet banking facility.
• RTGS (Real Time Gross Settlement) transactions at all branches.
• AAA Cash deposit (Customers) – Free up to 2 transactions per month and a value limit of
Rs. 50,000/-

BENEFITS
• Free unlimited access to 25,000 + other bank ATM’s- enhanced accessibility.
• Free multi branch, Multi-city banking convenience.
• Payable at par Cheques.
• Smartserv- Personal Concierge Services.

B) ING FORMULA SAVINGS ACCOUNT:

This is the product of ING Vysya Bank which is targeted towards the upper middle class
segment of the society. Basically the targeted segment is the age group between 18-40 yrs. This
product has its significance particularly in Metropolitan/A grade cities. This product is also
useful for people who travel frequently particularly to Metropolitan/A grade cities.
Minimum cash balance required to open this account and Quarterly Average Balance
requirement is Rs. 25000/-

Page | 14
Some of the major features and benefits of this account are :
• Maximum withdrawal limit from ING’s ATM or any other bank’s ATM is Rs. 50,000.
• Maximum shopping limit through ING’s ATM/Debit card is Rs. 75,000.
• Free Payable at Par cheques.
• Exclusive F1 themed, Internet Banking services.
• Formula 1 International Debit card.
• Free sms alerts on transactions above Rs. 1500.

SPECIAL BENEFITS CARD

FUEL GAUGE
• Fill fuel across any petrol pump in India and get the 2.5% surcharge waived.

SPEED LAP
• Shop using your ING Formula savings account and get Formula One merchandise.

RACE DAY
• Whenever there is a Formula 1 race anywhere in the world, there is a race for u as
well. Shop using your ING Formula debit card on the day of the race and top 25
spenders for the race day wins vouchers from ING.
• 3 winners – Gift vouchers worth Rs. 5000/-
• 10 runner ups- Gift vouchers worth Rs. 2000/-
• 12 second runner ups- Gift vouchers worth Rs. 1000/-

C)PLATINA ACCOUNTS
This product (account) of ING Vysya Bank is a special product for special class of customers.
This can also be termed as Preferred Platina Banking. This product is designed to reduce the
efforts put in handling banking and financial needs. This product has special features which are
mainly meant for business class people who have to make large payments and have regular
transactions. The Platina account holder becomes the preferred customer of the bank.
The average quarterly balance (QAB) is Rs. 100,000

Page | 15
Features:
• Dedicated Relationship Manager
Our dedicated relationship managers can help you manage your money; while you pursue
your passion, be it business or pleasure.
• Wealth Management Service
Our preferred banking services offer you customized financial strategies on how to invest
and where to invest based on simple financial risk profiling.
• ING Platina Debit Card
Use your ING Platina Gold Debit Card and withdraw cash up to Rs1 lac per day
from any ATM, Avail a 1% cash back on shopping with your Debit Card.
• Account Representative Services
Now when you are out building a business empire or taking that well deserved vacation,
just nominate someone else to do your routine banking enquires.
• Preferential rates on ING products
Get more out of the Platina relationship. Avail preferential rates on Demat, Bank
Lockers, Personal and Home loans.

Types of saving accounts offered by other private banks

ICICI BANK

A) ICICI Savings Bank Account:

ICICI Bank is also offering the saving accounts as their products.

• The ICICI Bank International debit card is a debit-cum-ATM card provides with the
convenience of acceptance at merchant establishments and cash withdrawals at ATM.
• Money Multiplier Facility
• Internet Banking is offered free of cost.
• Anywhere Banking facility entitles the account holder to withdraw or deposit cash upto a

Page | 16
 limit of Rs.50,000 across all ICICI Bank branches.
• An average quarterly balance of Rs.10,000 only in metro and urban locations.
• Nomination facility is available.
• Interest is payable half-yearly.

Third party withdrawal limit is only Rs 15,000 and free demand draft making facility for a
month is only up to Rs 10,000. Free withdrawal limit from ATM card is only up to Rs 25,000 in
all accounts.

B) GOLD PRIVILAGE ACCOUNTS

The Gold Privilege Account brings the customer exclusive benefits, especially created for
valuable customers. The minimum quarterly average balance (QAB) requirement for Gold
Privilege account is Rs.50,000. Non-maintenance of the required QAB in any quarter attracts a
charge as per the following guidelines:

If QAB is between Rs.50,000 and Rs.25,000, charge of Rs.250 will be levied

If QAB is between Rs.25,000 and Rs.10,000, charge of Rs.500 will be levied
If QAB falls below Rs.10,000, charge of Rs.750 will be levied
Your Gold Privilege account entitles you to select privileges and offers:

BENIFITS
• Jump Queue facility in ICICI Bank branches.
• Free usage of payable-at-par chequebook.
• International VISA Gold debit card with higher daily withdrawal and spend limit.
• Waiver of annual fee for Debit card.
• Free and Unlimited access (cash withdrawals and balance enquiry) to any Bank's ATM in
the country using ICICI Bank International Gold Debit card.
• Waiver of DD/PO charges for up to Rs.100,000 per day.
• Waiver of Anywhere Banking charges across all ICICI Bank branches.
• Priority Processing through ICICI Bank Phone Banking.

Page | 17
 • Preferential rates for Gold Coins.
• Better rates for Foreign Exchange Service.
• Discounts on Safe deposit locker facility.
• Special asset deals from time to time.

C) TITANIUM PRIVILAGED ACCOUNT

This product from ICICI is mainly to serve privileged customer (upper class)
In constant endeavor to fulfill all the banking needs and enhance exclusivity ICICI Bank
launched Titanium Privilege Account - tailored to take care of customer’s banking and
investment requirements and status. This account offers a dedicated Branch Relationship
Manager supported with a Phone Banking Relationship Manager.Customer can realize the
benefits of a Titanium Privilege Account on the basis of his total relationship value (TRV) with
the bank. Customer need to maintain a TRV of between Rs. 5 lac and Rs. 10 lac and a quarterly
average balance (QAB) of Rs.75,000. In addition to this, there is waiver of QAB charges, subject
to FD of min. 3.75 Lac.

BENIFITS
• Branch Relationship Manager supported with Phone Banking Relationship Manager.
• Priority processing at all ICICI bank branches and through customer care.
• A higher daily withdrawal and spend limit on a Titanium debit card.
• Free International Titanium Debit Card.
• Unlimited free access to any bank’s ATM throughout the country.
• Free usage of multi-city cheque book.
• Free physical monthly account statement.
• Anywhere banking.
• Complete waiver on DD/PO charges.
• Preferential rate on purchase of ICICI Bank Pure Gold.
Page | 18
 • Preferential rates on purchase of foreign exchange with a complete waiver on
commission charges.
• Discounted rates on safety locker charges.

HDFC BANK

A)REGULAR SAVING ACCOUNT

An easy-to-operate savings account that allows customer to issue cheques, draw Demand Drafts
and withdraw cash. Customer can check balances from the comfort of his home or office through
NetBanking, PhoneBanking and MobileBanking.
Withdrawal of cash from any of the 3275 ATM centers spread across the country.

FEATURES & BENEFITS

• Facilities like NetBanking and MobileBanking.
• Customer can check the account balance, pay utility bills or stop cheque payment,
through SMS.
• Personalized cheques with customer’s name printed on each cheque leaf for enhanced
security.
• Advantage of BillPay, an instant solution to all frequent utility bill payments. Instructions
for payment over the phone or through the Internet.
• Customers can avail the facilities like Safe Deposit Locker, Sweep-In and Super Saver
facility on their account.
• Free cash withdrawals on any other Bank's ATM
• 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.

B) SAVING MAX ACCOUNT

Page | 19
Welcome to a world of convenience. HDFC has presented SavingsMax account, loaded with
maximum benefits to make banking experience a pleasure. By maintaining an average quarterly
balance of just Rs. 25,000/- customer can get a host of premium services from HDFC Bank.

FEATURES & BENIFITS

• Free unlimited transactions: Cash withdrawal and balance enquiry, at all HDFC Bank
ATMs & on any other Bank's ATM using your HDFC Bank Debit Card.
• Free Gold Debit Card for primary account holder for lifetime of the account. Gold Debit
Card for other account holders at Rs 250/- p.a.
• Free Woman's Advantage/International Debit Card for all account holders for lifetime of
the account.
• Free Payable-at-Par (PAP) chequebook, without any usage charges up to a limit of 1 lac
per month.*
• Free Demand Drafts on HDFC Bank locations, upto a limit of 50,000/- per day at home
branch.
• Self/Third Party Cash Deposit/Withdrawal at non-home branches, upto Rs 50,000/- per
day free. Above Rs 50,000 a charge of Rs 2.90 per thousand on the full amount would be
applicable.
• Optional sweep out facility to transfer extra savings to a Fixed Deposit, at the threshold
of Rs.50,000/-.In the event of the balance in SavingsMax account exceeding Rs 50,000/-,
the amount in excess of Rs 50,000/- will be swept out in to a Fixed Deposit with a
minimum value of Rs 25000/- for a
1year 1day period.
• Free BillPay & InstaAlerts for all account holders for lifetime of the account.
• Free Monthly Statement of Account.
• 50% off on the Locker rental for the 1st year only.
• Folio maintenance charges on Demat account free for first year.
• Free National Electronic Funds Transfer facility, NetBanking, MobileBanking.
• Free Passbook facility available at home branch for account holders (individuals).

Page | 20
 • Free Email Statement facility

C)PREFERRED BANKING ACCOUNTS

This account has been offered by HDFC for its preferred customers, so as to give special benefits
to them. The minimum quarterly available balance (QAB) that has to be maintained in this
account is Rs. 2,00,000

FEATURES & BENIFITS

• Dedicated Relationship Manager
• Customized Investment Solutions
• Investment Options
• e-Broking
• Expedited Tax Payments
• Relationship Pricing
• Business Solutions
• On-demand exclusive privileges
• Annual Service Charge Waiver

CLASSIFICATION/ CATEGORIZATION
So, for convenience of the project and comparison the different accounts can be classified
into three categories:

Category A Category B Category C

1. PLATINA ACCOUNT FORMULA SAVING ORANGE SAVING

Page | 21
(ING) ACCOUNT (ING) ACCOUNT (ING)

2. TITANIUM PRIVILAGED GOLD PRIVILAGED SAVING

ACCOUNT
ACCOUNT (ICICI) ACCOUNT (ICICI) (ICICI)

3. PREFERRED BANKING SAVING MAX REGULAR

SAVING
ACCOUNT/PLATINUM ACCOUNT (HDFC) ACCOUNT
(HDFC) (HDFC)

Service quality
ING Vysya Bank provides the top notch quality to its customers. They have so many special
features that no other banks provide till date, like:

1. Special cabin/room for its customers to wait and relax when there is a rush or when
customer is asked to wait for some time.

2. Fastest RTGS and NEFT services, which takes place within minutes.

3. A well behaving staff and special highly sensitive customer care department. This is head
by a well efficient customer care manager.

4. Account verification with in promised 5 days.

5. Working hours from 10 a.m. to 6 p.m. (7 in p.m. if any customer is in need)

6. Doing things in the right way at right time

Page | 22
 7. It is the only Bank which provides the facility of withdrawal of 1 lakh rupees from any
ATM at one go.

3.4 FINANCIAL FIGURES W

In Rs. Crores Q3 Q3 % YTD YTD

2009-10 2008-09 growth 2010 2009

Net Interest Income 172.7 144.9 19.2% 487 357 36.1%

Other Income 149 95.7 55.9% 400 279 43.3%

Page | 23
Total Income 321.8 240.6 33.8% 887.8 637.5 39.3%

Operating Costs 215.3 158.9 35.5% 585.0 438 33.6%

Operating Profit 106.5 81.7 30.4% 302.8 199.5 51.8%

Operating Profit
after Exceptional 106.5 100 6.4% 302.8 219.8 37.7%
Items

Provision & 21.6 27.7 -22.1% 84.7 33.9 150.1%

Contingencies

Profit before Tax 84.9 72.4 17.3% 218.1 186 17.3%

Provision for Taxes 32.8 29.6 11% 78.4 71.9 9.1%

Profit after Tax 52.1 42.8 21.8% 139.7 114 22.5%

Growth at ING Vysya Bank.

In terms of pure numbers, the performance over the decades can better be appreciated from the
following table:

Rs. in millions

Year Networth Deposits Advances Profits Outlets

1940 0.001 0.400 0.400 0.001 4
1950 1.40 5.30 3.80 0.09 16
1960 1.60 20.10 13.50 0.13 19
1970 3.00 91.50 62.80 0.74 39

Page | 24
 1980 11.50 1414.30 813.70 1.13 228
1990 162.10 8509.40 4584.80 50.35 319
2000 5900.00 74240.00 39380.00 443.10 481
2001 6527.00 81411.10 43163.10 371.90 484
2002 6863.24 80680.00 44180.00 687.50 483
2003 7067.90 91870.00 56120.00 863.50 456
2004 7473.20 104780.00 69367.30 590.01 523
2005 7094.00 125693.10 90805.90 (381.80) 536
2006 10196.70 133352.50 102315.20 90.6 562
2007 11101.90 154185.70 119761.70 889.0 626
2008 14260.00 204980.00 146500.00 1569.00 677

Even in the recessionary period the ING Vysya Bank is going in profits. While other banks are
losing a big percentage of their expected profits.

ING Vysya Bank Q3 Profit up 22%

Continued Profit Growth sustained by Strong Fee Income Performance

The Board of Directors of ING Vysya Bank Ltd. approved the unaudited financial results of the
Bank for the quarter and period ended 31 December 2008 at its meeting in Bangalore at 23rd
January 2009.

FINANCIAL HIGHLIGHTS
Q3 Performance

Net Profit after Tax (PAT) for the quarter ended 31 December 2008 increased by 22% to
Rs.52.1 Crores from Rs.42.8 crores for the quarter ended 31 December 2007 and Profit before
Tax (PBT) rose 17% to Rs.84.9 crores from Rs.72.4 crores.

However, excluding the impact of exceptional items reported in the quarter ended 31 December
2007, PAT grew by 70% and PBT by 57% over the same quarter last year.

Net Interest Income (NII) was up 19% to Rs.172.7 crores from Rs.144.9 crores and Fee &
Other Income increased by 56% to Rs.149.1 crores from Rs.95.7 crores in the prior year.

Page | 25
Nine months ended December’08

The PAT for the period ended 31 December 2008 increased 23% to Rs.139.7 crores
fromRs.114.1 crores for the period ended 31 December 2007 and PBT grew 17% to Rs.218.1
croresfrom Rs.186.0 crores.

However, excluding exceptional items reported in the previous year, PAT increased by 40%
andPBT by 32% over the corresponding period last year. NII grew 36% to Rs. 487.2 crores from
Rs.357.9 crores and Fee & Other Income was up 43% to Rs. 400.6 crores from Rs. 279.6 crores
inthe previous year.

Business Highlights

Total Deposits grew 25% to Rs. 22,401 crores as at end December 2008 from Rs.17,871 crores
the year before. Current and Savings (CASA) deposits rose 8% to Rs.5,819 crores as at end
December 2008 from Rs. 5,406 crores as at end December 2007.

Advances grew 19% to Rs.16,014 crores in December 2008 from Rs. 13,409 crores in December
2007. Total Assets of the bank registered a 30% growth to Rs.29,050 crores. The Credit Deposit
Ratio was at 71.5% in December 2008 against 75.0% in December 2007.

The Gross NPA ratio and Net NPA ratio were at 1.84% and 1.09% respectively as at 31
December 2008 compared to 1.81% and 0.71% respectively as at 31 December 2007. The net
worth of the Bank as at 31 December 2008 stood at Rs.1,568 crores compared to Rs. 1,459
crores as at end December 2007 and the Capital Adequacy Ratio stood at 10.72% in December
2008. In October 2008, the bank increased its capital through the issue of Tier 1 Perpetual debt
amounting to approx. Rs.95 crores. Subsequent to the quarter end, the Bank raised an additional
Rs.200 crores of Upper Tier 2 capital which has been subscribed entirely by ING Group.

ING Vysya FOUNDATION (ING – CSR)

World over ING has strengthened its name as a good corporate citizen. The ING Chances for
Children initiative (CFC) a global program in partnership with UNICEF is to educate 50,000
underprivileged children in three countries, Ethiopia, India and Brazil by 2008. In India the focus
is primarily in the districts of Dharampuri and Krishnagiri in Tamil Nadu. Through the national

Page | 26
Child labor Elimination (NCLP) bridge schools, ING provides much needed support to UNICEF,
to fund, monitor, and provide children with quality primary education

The Indian arm of the Chances for Children programs is run by the support of ING business units
in India (ING, ING Life Insurance and ING Investment Management) through the ING Vysya
Foundation.

The Foundation was set up almost 3 year ago and was actively involved in the post Tsunami
rehabilitation of the victims. ING Group set up a dedicated Tsunami Support account. In India,
the Foundation partnered with five NGO providing much needed financial support, from
rebuilding of schools to providing fishing boats, giving much needed hope to destroyed lives.

The Indian chapter of CFC involves the partnership of the Foundation with 7 NGO working in
primary education. Not only does the Foundation provide much needed financial support to these
organizations but also runs strong voluntary programs giving the employees a chance to meet the
children, work with them and take ownership and responsibility for the vision of its partners. The
Foundation creates systems that ensure CSR activities within the organization. Various programs
are initiated with the employees, whether it is taking 100 children for a day out to the
planetarium or watching a film with them. It collectively influences the culture of the
organization; and also provides the employees with an opportunity to contribute to the vision of
the organizations CSR.

Recently ING Vysya Foundation launched its initiative “Run Ricky Run”. In this initiative, for
every run Ricky makes the Foundation will sponsor one child to go to school through its
association with its NGO partner in Bangalore, SUKRUPA.

Addressing health care, poverty or human rights issues, there is no better way than through the
corridors of education. The main focus of the Foundation in India is to support not for profit
organizations working in the area of education.

2.2 OBJECTIVE OF THE STUDY:

Page | 27
 PRIMARY OBJECTIVE:
• To thoroughly study the products & services of ING Vysya Bank.

• To compare the banking products and services offered by ING Vysya Bank and other
private banks (ICICI & HDFC)

• To study the customer’s expectations, behavior, responses & preferences for various
saving accounts of ING Vysya Bank.

• To study the marketing strategies adopted by ING Vysya Bank to maintain & increase its
market share & to retain its customers.

SECONDARY OBJECTIVE:
• To study banking operations.

• To get the knowledge about marketing strategies of bank.

DURATION OF THE STUDY

Duration of the study is 6 weeks.

2.3 RESEARCH METHODOLGY

All the conclusions are based on the survey done in the working within the time limit. I tried to
select the sample representative of the whole group during my training. I have collected data
from people linked with ING VYSYA BANK and OTHER BANK

RESEARCH PLAN:
Preliminary Investigation: In which data on the situation surrounding the problems shall be
gathered to arrive at
· The correct definition of the problem.
· An understanding of its environment.
.Exploratory Study: To determine the approximate area where the problem lies.

RESEARCH DESIGN:

Page | 28
Research was initiated by examining the secondary data to gain insight into the problem. By
analyzing the secondary data, the study aim is to explore the short comings of the present system
and primary data will help to validate the analysis of secondary data besides on unrevealing the
areas which calls for improvement.

DEVELOPING THE RESEARCH PLAN:

The data for this research project has been collected through self Administration. Due to time
limitation and other constraints direct personal interview method is used. A structured
questionnaire was framed as it is less time consuming, generates specific and to the point
information, easier to tabulate and interpret. Moreover respondents prefer to give direct answers.
In questionnaires open ended and closed ended, both the types of questions has been used.

COLLECTION OF DATA:
1: Secondary Data:
It was collected from internal sources. The secondary data was collected on the basis of
organizational file, official records, news papers ,magazines, management
books, preserved information in the company’s database and website of the company.

Primary data:

All the people from different profession were personally visited and interviewed. They were the
main source of Primary data. The method of collection of primary data was direct personal
interview through a structured questionnaire.

SAMPLING PLAN:

Since it is not possible to study whole universe, it becomes necessary to take sample from the
universe to know about its characteristics.

· Sampling Units: Different Account Holder and Service receiver from the bank

· Sample Technique: Random Sampling.

· Research Instrument: Structured Questionnaire.

· Contact Method: Personal Interview.

SAMPLE SIZE:

Page | 29
My sample size for this project was 100 respondents. Since it was not possible to cover the
whole universe in the available time period, it was necessary for me to take a sample size of 100
respondents.

DATA COLLECTION INSTRUMENT DEVELOPMENT:

The mode of collection of data will be based on Survey Method and Field Activity. Primary data
collection will base on personal interview. I have prepared the questionnaire according to the
necessity of the data to be collected

2.4 SCOPE OF STUDY

The scope of any study can be defined in terms of the area and the sample size which will be
reviewed for satisfying the objective of the subject matter. The first part of the report can be
made on the basis of the secondary data collected about the different saving bank accounts of
private sector banks present in Chandigarh via internet, magazines and journals.

The scope of the study is in Chandigarh, and around 100 people are targeted for the survey which
is done through questionnaire.

As the scope of study is limited to Chandigarh and to 100 people only, thus picture presented in
the testimony may not be the complete picture.

2.5 LIMITATIONS
• ING Vysya Bank have a very few branches in Northern India

• Customer are not aware about the ING Vysya Bank

• ING Vysya Bank have fewer banking/financial product compare to other

Page | 30
 • ING Vysya Bank have very few ATM .

• Research is only done in Chandigarh city

• Research is self-financed so money is a major constraint

• Respondents are biased toward their current bank.

• Time is 6 weeks, so much of economic fluctuations are not seen

2.6 RECOMMENDATION
 Many of the respondent are not aware about their key services. Bank has to take some
initiatives.

 Bank can post a list of services that they can rendered to the customer inside the bank
premises.

 ING Vysya Bank has to improve its brand image i.e. create a position in the mindset of the
customer.

 It should more emphasize on advertisement. Advertisement is a most powerful tool for

position and brand in the mindset of customer.

 ING Vysya Bank should ask for their customer feedback to know whether the consumer are
satisfied or dissatisfied.

 Due to intense competition in the financial market. ING Vysya Bank should adopt better
strategy to attract more customer

CHAPTER- 3
Page | 31
 DATA
INTERPRETATION
AND ANALYSIS

Comparative analysis of saving accounts:

Page | 32
a. Basic Saving Accounts (Category C)

PARTICULARS HDFC ICICI ING Vysya

ACCOUNT NAME Saving Regular Savings Orange Savings
Account Account Account
AVERAGE QUATERLY
BALANCE Rs10,000 Rs 10,000 Rs. 5,000

AQB MAINTAINANCE Rs 750.00 per Rs 750.00 Rs 750.00 per

CHARGES quarter Only. per quarter quarter Only.
Only.
SWEEP OUT FACILITY Available N.A Available
3 per month
FREE TRANSACTIONS from N.A Unlimited from
SBI/Andhra any bank’s ATM
Bank ATM
THIRD PARTY CASH N.A Rs.15,000 Rs.25,000 per day
WITHDRAWL/DEPOSIT per day
NET BANKING Free Free Free

MOBILE BANKING Free Free Free

Page | 33
b. Preferred Saving Accounts (Category B)

PARTICULARS HDFC ICICI ING Vysya

Account name SAVING MAX GOLD FORMULA

ACCOUNT PRIVILAGE SAVING
D ACCOUNT ACCOUNT

AQB (Average Quarterly 25,000 50,000 25,000

Balance)

Free DD Upto 50,000/qat N.A. Upto 50,000/qat.

Third Party Cash Deposit Upto 15,000 N.A. Upto 25,000

Smart-serv N.A. N.A. Present

Free Transaction 6 in a year N.A. Unlimited

Page | 34
 Direct 12 annual passes of
Special Features Bill Payments Preference famous night clubs
from accounts rates on gold and restaurants,
coins across India
Jump Que Facility Present N.A. Present

c. Privileged Saving Accounts (Category A)

PARTICULARS HDFC ICICI ING Vysya

Account Name Privileged Titanium Platina

Platinum

QAB (Quarterly 2,00,000 75,000 + TRV 1,00,000

Available Balance) of 5 to 10 lac

Page | 35
 DD/PO Wavier Available upto N.A. Available upto
50,000 50,000

PAP books Unlimited unlimited unlimited

One Lakh Cash

withdrawal from any N.A. N.A. Available*
ATM

Cash Back Offer on N.A. N.A. 1 to 2 %

Shoping*

Cashnet enabled N.A. N.A. Available

credit/debit card

FACTS AND PEOPLES’ PERCEPTION

A) SAVING ACCOUNTS OF RESPONDENTS IN THE BANK

TABLE NO. 1

Page | 36
 OPTIONS NO OF RESPONDENTS %AGE OF RESPONSE

ING VYSYA BANK 18 18%

ICIC BANK 51 51%

HDFC BANK 31 31%

FIGURE NO.1
INTERPRETATION

As per the data collected and analyzed, most of the people in Chandigarh have chosen ICICI
Bank for their banking. It is because ICICI was the first private banking player in the newly
formed state (U.K.) they hold the accounts of 51% of the respondents. Next rank comes to
HDFC with 31% of accounts. ING has captured 18% (speculative) of the market share within 6
months of its establishment in the State.

A) KNOWLEDGE OF THE ACCOUNT AND SERVICES ASSOCIATED.

Page | 37
 TABLE NO. 2

OPTIONS NO. OF RESPONDETS %AGE OF

RESPONDENTS

YES 80 80%

NO 15 15%

CAN’T SAY 5 5%

FIGURE NO.2

INTERPRETATION
As per the data collected and analyzed, most of the people in Chandigarh have chosen ICICI
Bank for their banking. It is because ICICI was the first private banking player in the newly
formed state (U.K.) they hold the accounts of 80% of the respondents. Next rank comes to
HDFC with 15% of accounts. ING has captured 5% (speculative) of the market share within 6
months of its establishment in the State.

B) QUARTERLY AVAILABLE BALANCE THAT HAS TO BE

MAINTAINED

TABLE NO. 3

Page | 38
 OPTIONS NO. OF RESPONDENTS %AGE OF RESPONSE

NILL 35 35%

5000 45 45%

10000 12 12%

ABOVE 10000 8 8%

8%
(QAB)
NIL 5,000 10000 >10,000

12% 35%

45%

FIGURE NO.3

INTERPRETATION
It is the amount which one has to maintain for a single quarter. 45% of the respondent were
maintaining 5,000 rupees. 35% were maintaining nothing, 12% were holding 10,000 as their
QAB. And 8% were holding more than 10,000 rupees.Out of 45% of the respondents who
maintain 5,000 rupees as their QAB, most of the respondents are having account in ICICI and
ING Vysya bank.

D) BANK PROVIDING SPECIAL FACILITY LIKE smart-serve

TABLE NO. 4
OPTIONS NO. OF RESPONDENTS %AGE OF
RESPONSE

Page | 39
 YES 90 90%

NO 10 10%

SPECIALFACILITIES
YES NO

10%

90%

FIGURE NO. 4

INTERPRETATION
Smart service is type of special services in which a person can send/present gifts to any of his/her
known in any of the city by just telling your banker the address of the person. The gift will be
purchased and will be delivered by the bank only, and the amount for the gift will be
automatically deducted from the sender’s account.10% of the people who were really enjoying
some of the special services provided by bank were found to be associated with ING Vysya
Bank.

E) PEOPLES’ RATING: ACCORDING TO THEIR PERCEPTION

TABLE NO.5
OPTIONS NO. OF RESPONDENTS %AGE OF RESPONSE

Page | 40
 AXIS BANK 11 11%

ICICI BANK 51 51%

ING VYSYA BANK 15 15%

HDFC BANK 23 23%

ChartTitle

60%
50%
40%
30%
20%
10%
0%
AXISBANK ICICI BANK ING Vysya BANK HDFC BANK

Series1 Series2 Series3

FIGURE NO.5

INTERPRETATION
51% of the people have rated ICICI Bank as 1st, this is because of wide market share of ICICI
Bank. 2nd Rank has been awarded to HDFC Bank by approximately 23% of respondents. 3rd
rating is given to ING Vysya bank by approx. 15% of the respondents. And last comes AXIS
Bank. Thus ING Vysya is better than AXIS and HDFC Bank in its Marketing Strategy.

F) PEOPLE’S MOST FREQUENT POINTS OF INTERACTION WITH

BANK

Page | 41
 TABLE NO.6
OPTIONS %AGE OF RESPONSE

ATM 100%

VISIT BANKING 35%

PHONE BANKING 35%

INTERNET BANKING 82%

POINTSOFINTERACTION

100%
82%
35% 35%

ATM VISIT BRANCH PHONE BANKING INTERNET

BANKING

FIGURE NO.6

INTERPRETATION
All of the bank customers interact most frequently with the bank by doing their transactions from
ATM. 35% of them visit branch quite often and 35% of the respondents also go for phone
banking. Internet Banking is the 2nd most point of interaction of bank and the customer. People
who use Internet banking and mobile banking were found to be associated mainly with ICICI
and ING Vysya Bank. ING Vysya is having best Internet banking attributes. This implies the
technological advancement in Chandigarh Citizens.

SWOT ANALYSIS

Page | 42
 Strengths Weakness

• ING as one on the biggest financial • Very few branches

MNC. 7th in 500 fortune • Less variety of financial/banking
• Only foreign bank which has acquired products
an Indian private bank (Vysya Bank) • Location
• Higher rate of interest than other
private banks
• Most of the financial plans are legalized
under 80(ccc)
• Top notch customer care and staff
behavior
• Unique features with different kinds of
accounts
• Working hours

Opportunities Threats

• New segment of doctors, students and
CAs as they like innovation in their
financial needs and like to enjoy the
services.
• High class (upper strata) population of
city
• Increase in different kind of financial
products
• NGO and Public Relations
• Presence of two top private banking
players in the market (ICICI & HDFC)
• Large market share already captured
• Non willingness of Muzaffarnagar
citizens to change for something new,
or to try innovation in their banking.

Page | 43
CHAPTER - 4

FINDINGS

Page | 44
The study conducted directs toward the Private Banking scenario in the city Chandigarh Study
suggested that a large market share has been captured by ICICI Bank and HDFC Bank. Out of
two ICICI is enjoying the maximum market share. This is probably because of the reason that
ICICI was the first private bank in the state as well as in city.

Most of the people know about the account and services associated with it. Most of the people
are maintaining 5,000 rupees as QAB in their private banking account, but most of them except
ING Vysya customer are unaware of the special facilities available.

People have ranked ICICI bank as best in the city. This is may be due to the oldest persistence of
ICICI bank in the city. They have rated HDFC as 3rd and ING Vysya as 2nd.

Almost everyone comes in contact with their bank by the use of ATM machines. 80% of the
respondents were using internet banking that implies high literacy rate in the city.

People think that the staff of ICICI does not behave well with their customers but ING Vysya
customers are glad with the staff of ING Vysya Bank. But on the other hand ICICI customers are
very happy with the working hours of ICICI bank. HDFC customers are a bit unhappy with the
working hours of their bank.

People are very much bothered by the distance between their home and the bank. They believe
that this a major issue which influence the customer to open an account in any bank. Most of the
people are not entertained by the television advertisements about various banks. Even word of
mouth has not been proved as

strong marketing channel about banking. It implies that for banking customer is looking at the
commitment, real facts, distance between their home and bank, behavior of the banker, QAB
and many more.

Page | 45
 BIBLIOGRAPHY
WEBSITES

• www.ingvyshttp://www.ingvysyabank.com/scripts/retailaccountsdeposit.a
spxyabank.com

• http://www.icicibank.com/Personal-Banking/account-deposit/personal-
banking-accounts-deposits.html

• http://www.hdfcbank.com/personal/accounts/default.htm

• http://indiaearnings.moneycontrol.com/home.php

• http://economictimes.indiatimes.com/Personal-Finance/Fixed-
Deposits/articlelist/2146932.cms

• http://www.blackle.com/

BOOKS

• India Today
• Chronicle
• Business World
• Business Today

Page | 46
ANNEXURE
Page | 47
Questionnaire

Comparative analysis of saving bank accounts of different private sector banks

Dear respondent,

We are conducting a research to know the general perception and attitude of customer towards
the products & services that are offered by ING Vysya Bank & other private banks (ICICI &
HDFC) in Chandigarh. The information will be valuable input for the research and we assure you
that the information will be kept confidential. We hope that you will co-ordinate with us and give
quite a few minutes from your precious time and give the genuine answer.

Personal Details:-
Name:-

Gender :- M F

Age:-

Address:-

Page | 48
Occupation:- Service
Professional
Businessman
Others (Please Specify)…………..
Educational Qualification:- Under Graduate

Graduate

Post graduate

Phone no.(Optional):-

Annual Income:- Below 1 Lac

1 Lac – 3 Lac
3 Lac - 5 Lac
Above 5 Lac

1) Do you have a saving account in any of the Private banks in CHANDIGARH ?

a) Yes

b) No

2) In which of the following banks do you have saving bank account?

1. ING Vysya Bank

2. ICICI Bank 4. Any Other Bank

3. HDFC Bank

(Please Specify…………………………)

Page | 49
 3) Do you have complete knowledge of the saving account and services associated with that
account you have?

a) Yes

b) No
c) Can’t say

4) Are you a preferred/privileged customer of your bank?

a) Yes b) No

5) How much Quarterly Available Balance (QAB) you need to maintain?

a. Nil

b. 5,000

c. 10,000

d. More than above

6) Does your Bank provide you some special services like smart serve, mi-banking?

a. Yes

b. No

Page | 50
7) Please rate the following banks on the scale of 4 where 1is the least and 4 is the most
according to your perception you are having for reputation of the banks.

ING Vysya ICICI Bank HDFC Bank Axis Bank

Bank

8) What is your most frequent point of interaction with the bank?

• Visit Branch

• ATM

• Phone Banking

• Drop Box

• Internet Banking

• Mobile Banking

Page | 51