Enhancing the Fixed Deposit Penetration in Retail Banking” with reference to HDFC by Sanjay Gupta

“PROJECT: -Enhancing the Fixed Deposit Penetration in Retail Banking”

Submitted in U.P. Technical University, Lucknow for Post Graduate Degree Course in Master in Business Administration (MBA)

Guided by:MR.VAIBHAB KUMAR FOUZDAR BRANCH MANAGER HDFC BANK SANJAY PLACE AGRA,(U.P).

Submitted by:YOGESH KUMAR ROLL .NO. 080677081 M.B.A (IIIrd sem) HINDUSTAN INSTITUTE MANAGEMENT AND COMPUTER STUDIES FARAH ,MATHURA (U.P),

CONTENTS

Contents

Acknowledgement

Preface

Declaration

Origin of the HDFC bank

HDFC Companies Profile

Key Business Segment

Growth and Development of the Bank

Functional Departments of the Bank

Market profile of the organization

Important events in the history of HDFC Bank

Composition of the Board

HDFC Bank products at a glance

Fixed Deposits

Awards and Achievements won by the HDFC Bank

Comparison between different banks

Analysis of survey conducted

Suggestions

104

Conclusion

106

Bibliography

108

ACKNOWLEDGEMENT

I take great pleasure to thank and acknowledgement the permission and allowance by Mr. VAIBHAB KUMAR BRANCH MANAGER, HDFC BANK AGRA REGION and his help and inspiration provided. I extend a whole hearted thanks to Mr. VINOD KUMAR under whom I worked and learned a lot and for enlightening me with their knowledge and experience to grow with the corporate working. Their guidance at every stage of the Project enabled me to successfully complete this project which otherwise would not have been possible without their constant encouragement and motivation, without the support it was not possible for me to complete the report with fullest endeavour. I would also like to extend my thanks to my College Faculty Members all my colleagues in the company who supported me in carry out my operation successfully and generously and provided me vital information/ training regarding the my project objective. YOGESH KUMAR FOUZDAR

M.B.A (IIIrd SEM)

PREFACE I had undergone a practical training under HDFC BANK AGRA REGION. It was a good exposure for me to undergo training in such a company to get the knowledge and experience regarding Marketing and sales. Summer training is one of the major experiencing component of the knowledge, gain of relevant of information with respect to marketing and dealing with situations in a professional course like M.B.A. where a professional person faces a problem in a field. I was able to get familiarized with the customer relationship and got to know how a company measures to resolve their grievances and service them to the maximum for future prospect and success. Field component like survey, generation of questionnaire with respect to marketing helped me a lot and would be a great support in future. “It is good to have enthusiasm but it is essential to have training. Training can be in all way of life.” Thus I would say that this training was beneficial educative & good exposure to me, which will certainly help in my near future. This project was designed with respect to this company. 5

DECLARATION

I hereby declare that the project entitled “Enhancing the Fixed Deposit Penetration in Retail Banking” submitted for the M.B.A. Degree is my original work and the dissertation has not formed the basis for the award previously of any degree, associate ship, fellowship or any other similar titles.

Place:

Yogesh Kumar Fouzdar

Date:

(Student’s name)

Origin of the HDFC bank

Housing Development Finance Corporation Limited, more popularly known as HDFC Bank Ltd, was established in the year 1994, as a part of the liberalization of the Indian Banking Industry by Reserve Bank of India (RBI). It was one of the first banks to receive an 'in principle' approval from RBI, for setting up a bank in the private sector. The bank was incorporated with the name 'HDFC Bank Limited', with its registered office in Mumbai. The following year, it started its operations as a Scheduled Commercial Bank. HDFC Bank Limited. The Group's principal activities are to provide banking and other financial BANK. The Group operates through four segments: Treasury, Retail Banking, Wholesale Banking and Other Banking Business. The Treasury BANK segment consists of net interest earnings on investments portfolio of the bank and gains or losses on investment operations. The Retail Banking segment serves retail customers through a branch network and other delivery channels. This segment raises deposits from customers and makes loans and provides advisory BANK to customers. The Wholesale Banking segment provides loans and transaction BANK to corporate and institutional

customers. The Other Banking Operations segment provides BANK relating to credit cards, debit cards, third party product distribution and primary dealership business and other associated costs. The Bank was Incorporated on 30th August 1994.

A new private sector Bank promoted by housing Development

Corporation Ltd. (HDFC), a premier housing finance company. The bank is the first of its kind to receive an in-principle approval from the RBI for establishment of a bank in the private sector. Certificate of Commencement of Business wasreceived on 10th October 1994 from RBI. The Bank transacts both traditional commercial banking as well as investment banking. HDFC, the promoter of the bank has entered into an agreement with National Westminister Bank Pc. and its subsidiaries (Nat west Group) for subscribing 20% of the banks issued capital and providing technical assistance in relation to the banks proposed banking business.

HDFC BANK: - COMPANY’S PROFILE

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

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

BUSINESS FOCUS:-

HDFC Bank's mission is to be a World-Class Indian Bank. The objective is to build sound customer franchises across distinct businesses so as to be the preferred provider of banking services for target retail and wholesale customer segments, and to achieve healthy growth in profitability, consistent with the bank's risk appetite. The bank is committed to maintain the highest level of ethical standards, professional integrity, corporate governance and regulatory compliance.

HDFC Bank's business philosophy is based on four-core values: -

•

Operational Excellence

•

Customer Focus

•

Product Leadership

•

People

Capital Structure:-

At present, HDFC Bank boasts of an authorized capital of Rs 550 crore (Rs5.5 billion), of this the paid-up amount is Rs 424.6 crore (Rs.4.2 billion). In terms of equity share, the HDFC Group holds 19.4%. Foreign Institutional Investors (FIIs) have around 28% of the equity and about 17.6% is held by the ADS Depository (in respect of the bank's American Depository Shares (ADS) Issue). The bank has about 570,000 shareholders. Its shares find a listing on the Stock Exchange, Mumbai and National Stock Exchange, while its American Depository Shares are listed on the New York Stock Exchange (NYSE), under the symbol 'HDB'

DISTRIBUTION NETWORK:-

HDFC Bank is headquartered in Mumbai. The Bank at present has an enviable network of over

761 branches spread over

327 cities across India. All

branches are linked on an online real-time basis. Customers in over 120 locations are also serviced through Telephone Banking. The Bank's expansion plans take into account the need to have a presence in all major industrial and commercial centers where its corporate customers are located as well as the need to build a strong retail customer base for both deposits and loan products. Being a 11

clearing/settlement bank to various leading stock exchanges, the Bank has branches in the centers where the NSE/BSE has a strong and active base member.

The Bank also has a network of about over

1977 networked ATMs across

these cities. Moreover, all domestic and international Visa/MasterCard, Visa Electron/Maestro, Plus/Cirrus and American Express Credit/Charge cardholders can access HDFC BANK’s ATM network.

MANAGEMENT:-

Mr. Jagdish Kapoor took over as the bank's Chairman in July 2001. Prior to this, Mr. Kapoor was a Deputy Governor of the Reserve Bank of India.

The Managing Director, Mr. Aditya Puri, has been a professional banker for over 25 years and before joining HDFC Bank in 1994 was heading Citibank’s operations in Malaysia.

The Bank's Board of Directors is composed of eminent individuals with a wealth

of experience in public policy, administration, industry and commercial banking. Senior executives representing HDFC are also on the Board.

Senior banking professionals with substantial experience in India and abroad head various businesses and functions and report to the Managing Director. Given the professional expertise of the management team and the overall focus on recruiting and retaining the best talent in the industry, the bank believes that its people are a significant competitive strength.

KEY BUSINESS SEGMENTS

HDFC Bank offers a wide range of commercial and transactional banking services and treasury products to wholesale and retail customers. The bank has three key business segments:

1. WHOLESALE BANKING SERVICES

The Bank's target market ranges from large, blue-chip manufacturing companies in the Indian corporate to small & mid-sized corporate and agribased businesses. For these customers, the Bank provides a wide range of 13

commercial and transactional banking services, including working capital finance, trade services, transactional services, cash management, etc. The bank is also a leading provider of structured solutions, which combine cash management services with vendor and distributor finance for facilitating superior supply chain management for its corporate customers. Based on its superior product delivery / service levels and strong customer orientation, the Bank has made significant inroads into the banking consortia of a number of leading Indian corporates including multinationals, companies from the domestic business houses and prime public sector companies. It is recognized as a leading provider of cash management and transactional banking solutions to corporate customers, mutual funds, stock exchange members and banks.

2. RETAIL BANKING SERVICES

The objective of the Retail Bank is to provide its target market customers a full range of financial products and banking services, giving the customer a one-stop window for all his/her banking requirements. The products are backed by world-class service and delivered to the customers through the growing branch network, as well as through alternative delivery channels

like ATMs, Phone Banking, Net Banking and Mobile Banking. The HDFC Bank Preferred program for high net worth individuals, the HDFC Bank Plus and the Investment Advisory Services programs have been designed keeping in mind needs of customers who seek distinct financial solutions, information and advice on various investment avenues. The Bank also has a wide array of retail loan products including Auto Loans, Loans against marketable securities, Personal Loans and Loans for Two-wheelers. It is also a leading provider of Depository Participant (DP) services for retail customers, providing customers the facility to hold their investments in electronic form. HDFC Bank was the first bank in India to launch an International Debit Card in association with VISA (VISA Electron) and issues the Master Card Maestro debit card as well. The Bank launched its credit card business in late 2001. By September 30, 2005, the bank had a total card base (debit and credit cards) of 5.2 million cards. The Bank is also one of the leading players in the "merchant acquiring" business with over 50,000 Pointof-sale (POS) terminals for debit / credit cards acceptance at merchant establishments.

3. TREASURY

Within this business, the bank has three main product areas - Foreign Exchange and Derivatives, Local Currency Money Market & Debt Securities, and Equities. With the liberalization of the financial markets in India, corporate need more sophisticated risk management information, advice and product structures. These and fine pricing on various treasury products are provided through the bank's Treasury team. To comply with statutory reserve requirements, the bank is required to hold 25% of its deposits in government securities. The Treasury business is responsible for managing the returns and market risk on this investment portfolio.

RATINGS GIVEN TO HDFC BANK:-



Credit Rating

The Bank has its deposit programs rated by two rating agencies - Credit Analysis & Research Limited (CARE) and Fitch Ratings India Private Limited.

The Bank's Fixed Deposit programme has been rated 'CARE AAA (FD)' [Triple A] by CARE, which represents instruments considered to be "of the best quality, carrying negligible investment risk". CARE has also rated the bank's Certificate of Deposit (CD) programme "PR 1+" which represents "superior capacity for repayment of short term promissory obligations". Fitch Ratings India Pvt. Ltd. (100% subsidiary of Fitch Inc.) has assigned the "tAAA (ind )" rating to the Bank's deposit programme, with the outlook on the rating as "stable". This rating indicates "highest credit quality" where "protection factors are very high". The Bank also has its long term unsecured, subordinated (Tier II) Bonds rated by CARE and Fitch Ratings India Private Limited and its Tier I perpetual Bonds and Upper Tier II Bonds rated by CARE and CRISIL Ltd. CARE has assigned the rating of "CARE AAA" for the subordinated Tier II Bonds while Fitch Ratings India Pvt. Ltd. has assigned the rating "AAA (ind)" with the outlook on the rating as "stable". CARE has also assigned "CARE AAA [Triple A]" for the Banks Perpetual bond and Upper Tier II bond issues. CRISIL has assigned the rating "AAA / Stable" for the Bank's Perpetual Debt programme and Upper Tier II Bond issue. In each of the cases referred to above, the ratings awarded were the highest assigned by the rating agency for those instruments.



Corporate Governance Rating

The bank was one of 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 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.

Growth and Development of the Organization 1994. On 16.1.1995, 90,79,930 No. of equity shares were allotted to Jarrington Pte. Ltd. Another 400,00,000 equity shares were allotted on private placement basis to Natwest Group on 9.5.1995. 500,00,000 shares were allotted to the public on 9.5.95 The Bank opened its first branch in Ramon House at Churchgate, Mumbai on January 16th.

The Bank has created an efficient operating system using well tested state-ofthe-art software. 1995 70 No. of equity shares issued to subscribers to the Memorandum &Articles of Association on 30th August 1994. On the same date 500,00,000 equity shares were allotted to HDFC promoters. 509,20,000 shares were allotted to HDFC Employees Welfare Trust and HDFC Bank Employees Welfare Trust on 22nd December,

1996 HDFC Bank has entered the banking consortia of over 50 corporates, including some leading multinational companies, flagship companies of local business houses and strong public sector companies.

HDFC Bank has set up a state-of-the-art dealing room to handle all transactions possible in Indian financial markets. The Certificates of Deposits were awarded a PP1+ rating which is the highest rating for short term instruments indicating superior capacity for repayment.

2001

- The Bank has opened its first branch in Aurangabad. HDFC Standard Life Insurance has entered into a memorandum of understanding with the Chennaibased Indian Bank. The Bank has launched the international Maestro debit card inassociation with Master Card. HDFC Bank will launch its credit card in June through link-ups with MasterCard and Visa.LTtrade.com has entered into a strategic tie-up with HDFC Bank to provide Net banking BANK to online investors. Standard Chartered Bank, HDFC Bank and Bharat Petroleum Corporation have joined the eCash Forum which has been set up by the Smart Card Forum of India. HDFC Bank has launched a new campaign for its eage savings account. HDFC Bank entered into a strategic tie-up with Tally Solutions Pvt. Ltd. to offer online real time accounting BANK to small and Medium enterprises.The Bank has opened four ATMs outlets in Bangalore at Coles Road, RT Nagar, Rajaji Nagar and Jaya Nagar on March 26. HDFC Standard Life Insurance has launched a `Development Insurance Plan' a low cost life insurance product developed specifically to meet the needs of economically weaker sections. Two Directors, Mr. S.S. Thakur and Mr. Amit Judge, have resigned from the board of the bank effective from March 30. HDFC Bank files with US

regulators to list more than 11 million American Depositary Shares on the New York Stock Exchange. Today HDFC Bank has 1,412 branches and over 3,295 ATMs, in 528 cities in India, and all branches of the bank are linked on an online real-time basis.

[2]

of September 30, 2008 the bank had total assets of INR 1006.82 billion.[3] For the fiscal year 2008-09, the bank has reported net profit of Rs.2,244.9 crore, up 41% from the previous fiscal. Total annual earnings of the bank increased by 58% reaching at Rs.19,622.8 crore in 2008-09.

Present Status of the Organization:-

March 2007

March 2008

March 2009

Citied

228

316

452

Branches

535

684

1412

ATMs

1323

1605

3275

Housing Development Finance Corporation Limited, more popularly known as HDFC Bank Ltd, was established in the year 1994, as a part of the liberalization

of the Indian Banking Industry by Reserve Bank of India (RBI). It was one of the first banks to receive an 'in principle' approval from RBI, for setting up a bank in the private sector. The bank was incorporated with the name 'HDFC Bank Limited', with its registered office in Mumbai. The following year, it started its operations as a Scheduled Commercial Bank. Today, the bank boasts of as many as

1412

branches

and

over

3275

ATMs

across

India. Amalgamation

In 2002, HDFC Bank witnessed its merger with Times Bank Limited (a private sector bank promoted by Bennett, Coleman & Co. / Times Group). With this, HDFC and Times became the first two private banks in the New Generation Private Sector Banks to have gone through a merger. In 2008, RBI approved the amalgamation of Centurion Bank of Punjab with HDFC Bank. With this, the Deposits of the merged entity became Rs. 1,22,000 crore, while the Advances were Rs. 89,000 crore and Balance Sheet size was Rs. 1,63,000 crore. Head Office HDFC Bank Ramon House, 169, Backbay Reclamation, H T Parekh Marg, Churchgate Mumbai - 400020 Phone: +91 (22) 66316000, 66636000, 66316060

Fax: +91 (22) 22048834 Website: www.hdfc.com

Functional Departments of the Bank The functional departments of the organization consists of the HR department, the administrative department and the executive department. The HR department of the organization consists of the people who employ the Persons who they think would be able to do justice with the job handled.The administrative department of the organization consists of the director and the manager of the organization. They preside the organization and control all the operations of the organization such that the organization could run in a smooth and effective manner.The executive department of the organization consists of the various employees Who execute the job undertaken by them. The employees consists of the team leaders, the Corporate financial consultants,. the telecallers, various staffs and junior staffs who are the main structural framework of the organization. The organization thus runs with the effective coordination of the HR department, the administrative department and the executive department such that the supervisors of the organization preside over the subordinate employees to give them directions about fulfilling their works most efficiently

and effectively. Technical Consultancy Department: The Technical Consultancy Department is responsible for technical appraisal of industrial projects. The mission of the division is aimed towards the verification of the technical viability of industrial projects and assisting the Funds management in taking the decisions that require technical expertise. Moreover, it is responsible for conducting technical studies and rendering technical consultancy BANK to certain industrial sectors for the purposes of investigating modern technologies and productivity levels for local manufacturing plants.

H R Department: HDFC Human Resources department plans and direct for the employee population as well as they are having the following functions as: Hiring  Promotions  Reassignments  Position classification and grading  Salary determination  Performance appraisal review and processing

 Personnel data entry and records maintenance  Policy development  Work permitting immigration visa program  Workers’ compensation

Finance Department: The Finance Manager is responsible for all aspects of the accounting and financial administration of the HDFC, the supervision of the implementation of the HDFC financial policies, directives and procedures and the initiation of the financial plans within the guidelines of HDFC The department contains several distinct sections, each of which is responsible for a proportion of the activities taking place within the finance department.

Marketing Consultancy Department: The Marketing Consultancy Department plays and important role within the Fund as it studies and analyzes marketing information in order to build solid base for management decisions. The division also assists projects sponsors in formulating solid marketing strategies to improve their industries and strengthen their position in the local and international markets.

Research Department: The Research Department is having the capacity to act through four composing units i.e., the market research unit, economic studies unit, and statistical studies unit. It is the mission of the division to provide support BANK for information and consultancy to the senior management and division in the areas of economic, statistical and marketing information and consultancy through data analysis, processing of economic and statistical data, market research studies and publishing related periodical reports.

Organization Structure and Organization Chart

The organization structure of the company HDFC is such that it comprises of the departments and the employees in the hierarchical order so that they are able to perform their functions and duties smoothly and effectively doing their job in a manner in which it should be done. The organization is headed by the administrative department which coordinates and controls the executive department. The executive department is a link from the top and the bottom

comprising of the lower level employees such that they work together to fulfill the common objective of getting business from the persons who get in touch with them and see to it that they are provided with the best of the BANK which constitute giving financial advise to providing Account to the customers. The lower level employees and the corporate financial consultants work together to see to it that the database for providing financial BANK to sufficient number of people is made .They work together to see to it that this database is followed and worked upon such that more and more number of people get themselves avail the financial BANK of the organization. Team leaders who form the part of the administrative department of the Organization make sure that the clients that turn up for the financial BANK are dealt with most efficiently and effectively.

The organizational structure is well planned out and it follows a simple format which is follows:

Organization Chart:-

Each team lead has a team comprising only of both senior as well as junior market research analyst who aid the team lead in the entire market research process as it has been discussed previously. This is the basic organizational structure followed by HDFC BANK.

Market profile of the organization HDFC Bank Limited provides various financial products and services. It operates in three segments: Retail Banking, Wholesale Banking, and Treasury. The Retail Banking segment provides various deposit products, including savings accounts, current accounts, fixed deposits, and demat accounts. It also offers auto, personal, commercial vehicle, home, gold, and educational loans; loans against securities, property, and rental receivables; and health care finance working capital finance, construction equipment finance, and warehouse receipt loans, as well as credit cards, debit cards, depository, investment advisory, bill payments, and transactional services. In addition, this segment sells third party financial products, such as mutual funds and insurance, as well as distributes life and general insurance products through its tie-ups with insurance companies and mutual fund houses. The wholesale banking segment provides loans, non-fund facilities, and transaction services to large corporate, emerging corporate, small and medium enterprise, supply chain, public sector undertaking, central and state government departments, and institutional customers. It offers deposit and transaction banking products, supply chain financing, working capital and term finance, agricultural loans, and funded, non-funded treasury, and foreign exchange products. These segments services

include trade services, cash management, money market, custodial, tax collection, and electronic banking. In addition, it provides correspondent bank services to co-operative banks, private banks, foreign banks, and regional rural banks; and wealth management products for non-resident Indians. The Treasury Services segment operates primarily in areas, such as foreign exchange, money market, interest rate trading, and equities. As of March 31, 2009, HDFC Bank had a network of 1,412 branches and 3,295 automated teller machines in 528 cities in India. The company was founded in 1994 and is based in Mumbai, India.

In today’s growing world everyone needs to diversify their business so as to keep in touch with the rapid development. By analyzing the growing concerns of the market, HDFC has clients varying from investment banking sector, retail, web designing companies, etc. Due to this rapid development HDFC Group has many teams working for the above mentioned sectors.

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

The products and BANK of our competitors are as follows:A.

Customer Satisfaction Analysis:

Customer analysis involves gathering data about the customers and their characteristics. They also conduct tailored customer satisfaction surveys to gauze customer satisfaction. B.

Risk

These BANK are used by the competitors in order to gather external information and research the possible effect on the competitiveness of company. C.

Product Research BANK:

The conduction of extensive product research by this service helps the competitors to find out the marketability of a product or service. The research can be utilized to leverage the major decisions of a company on the marketing of its products. D. Advertising Research BANK:

Advertising research strives to gain valuable information about the effects and reach of advertising the products in different forms of media.

IMPORTANT EVENTS IN THE HISTORY OF HDFC BANK

1994 •

The bank was incorporated on 30th august. A new private sector bank promoted by housing development corporation Ltd. (HDFC), a premier housing finance company. The bank is the first of its kind to receive an in-principle approval from the RBI for establishment of a bank in the private sector. Certificate of commencement of business was received on 10th October 1994 from RBI.

•

The bank transacted in both traditional commercial banking as well as investment banking. HDFC, the promoter of the bank has entered into an agreement with National Westminster Bank ac. And its subsidiaries (Natwest Group) for subscribing 20% of the banks issued capital and providing technical assistance in relation to the banks proposed banking business.

1995 •

70 number of equity shares issued to subscribers to the memorandum & articles of association on 30th August 1994. On the same date 50000000 equity shares were allotted to HDFC promoters. 50920000 shares were allotted HDFC Employees Welfare Trust and HDFC Bank Employees Welfare Trust on 22nd December 1994.

•

On 16.1.1995, 9079930 no. Of equity shares were allotted to Jerrington Pte. Ltd. Another 40000000 equity shares were allotted on private placement basis to Natwest Group on 9.5.1995. 50000000 shares were allotted to the public on 9.5.1995(all were taken up).

•

The bank opened its first branch in Ramon House at Church gate, Mumbai on january16th.

•

The bank had created an efficient operating system using well-tested state of the art software.

1996 •

HDFC Bank had entered the banking consortia of over 50 corporate, including some leading multinational companies, flagship companies of local business houses and strong public sector companies.

•

HDFC Bank had set up a state of the art dealing room to handle all transactions possible in Indian financial markets.

•

The Certificate of Deposits was awarded a PP1+ rating which in the highest rating for short term instruments indicating superior capacity for repayment.

1997 •

The bank is one of the largest which mobilizes of retail deposits through its network of 20 branches.

•

The bank had set up an ultra modern hub at Powai in Mumbai where the bank’s central computer is housed. This hub housed in 35000 square feet, houses data of all the branches and facilitates inter connectivity between branches and link up with on line system.

•

HDFC Bank had also signed up as a depository participant under the newly set up NSDL, wherein the members clearing account settlement for dematerialized shares can be done through the bank.

•

The bank proposed to launch tele-banking for the first time in June in Mumbai at its Chandiveli branch.

•

The bank had become the first private sector to conclude as structured interest rate option deal.

•

The bank had launched in Versova branch, the 11th branch in Mumbai.

•

The bank, as part of its expansion plans in the south, had opened another branch in Chennai.

•

The bank had entered into strategic alliance with 10 overseas banks to provide customers with a wide range of derivatives including interest rate and foreign currency swaps.

•

The bank, on October 14th introduced ATMs that converse in a regional language.

•

The bank had launched an account in all its 28 branches across India that seeks to free depositors from minimum balance requirement, for the first time in the country.

•

The bank had introduced a new loan product for the payment of betterment fees announced by the Bangalore Mahanagar Palika.

•

The bank was all set to launch its debit card by April 1998.

•

The bank tied up with the Ahmedabad Stock Exchange to act as its

1998

clearing bank.

•

The bank proposed to strengthen its branch network in Calcutta with the addition of two new branches in the first quarter of the next fiscal.

•

The bank signed an agreement with the National Stock Exchange, which gave it a second charge over the brokers deposit for providing loan against share facility to NSE brokers.

•

The bank had also entered into a similar understanding with the Bombay Stock Exchange whereby the house will provide support for recovery of money against the card for loan against share facility.

•

The bank had also entered into “Cirrus” arrangements by which all Master card holders across the globe will be able to transact at HDFC Bank.

•

The bank also started with providing phonebanking facility in Bangalore.

•

The bank tied up with Visa International to offer its debit card.

•

The bank had entered into a Memorandum of Understanding for strategic business collaboration with Chase Manhattan bank.

1999

•

The bank became the first bank in India to link up its automated teller machine (ATM) network with the entire major payment systems worldwide.

•

The bank was the first bank in the Asia-pacific region to connect the American Express Payment System.

•

The bank expanded its ATM services to connect to American Express Interchange based in Phoenix, Arizona, USA.

•

The bank was the first to sign up with AMEX in December 1998.

•

Sony India ltd. Heads joined hands with HDFC Bank to work out an innovative car finance package under which a Sony car audio system would be installed to a new car for no additional upfront cash flow.

•

The bank had decided to issue 13310000 equity shares of Rs. 10 each to HDFC Bank and a wholly owned subsidiary of it at a price of Rs. 94 per share.

•

The bank had tied up with BPL ltd. To offer Internet enabled supply chain management and business-to- consumer e-commerce services to corporates.

•

Hutchinson Max Telecom and HDFC Bank had introduced the country’s’ first ever mobile banking services in the city.

2000 38

•

HDFC Bank also signed a Memorandum of Understanding with Singapore Telecom’s e-commerce arm Sesami.com Pvt Ltd.

•

The Bank later also entered into a partnership agreement with National Computer Systems, the e-commerce unit of Singtel.

•

A new company called Sesami.com (India) has been formed by a strategic alliance between HDFC Bank and Singapore Telecom ecommerce company Sesami.com,to offer e-commerce solutions for the Indian market.

•

HDFC Bank had a tied up with Maxtouch for giving the facility to the later customers in Mumbai. This is the first and only service of this sort in the country, he said.

•

HDFC Bank also launched an online electronic banking solution called Enet which will allow corporate to access their accounts over the net and carry out trade related transactions and cash management functions.

•

HDFC Bank entered into a tie up with Telco by which the bank would provide preferential financing options for Tata’s range of passenger cars including the Indica, Sumo, Safari, Estate and Sierra.

•

HDFC Bank allotted 1.98crore shares of Rs.10 each at an issue price of Rs.94 per share to promoters and strategic investors on March 29.

•

HDFC Bank is also set to become the first bank in the country to offer wireless application protocol (WAP) services to customers.

•

Sky Cell Communications Ltd, one of the two cellular service providers in Chennai, had launched ‘Sky Banking’, for which the company had tied up with ICICI Bank and HDFC Bank.

•

The bank had tied up with financial portals, e-brokerages and the National Stock Exchange to enable broker payments for e-broking ventures.

•

The bank had set up 100 new Electronic Data Capture (EDC) terminals in Mumbai.

•

The bank had launched its first B2C payment gateway which allows Visa and Mastercard credit card holders to do transaction online real time.

•

CYBERITMALL.COM had joined hands with the bank to provide Visa/Mastercard users with an online payment gateway solution to enable them to have a secure e-shopping experience.

•

The bank plans to extend its mobile phone banking services introduced in select metros to mobilephone broking when it introduces its internet on-line trading in July.

•

The bank and portal clickforsteel.com have signed a Memorandum of Understanding for offering online credit and services to facilitate “post-transaction” activities through the portal’s “allied services providers” programme.

•

Indianinfoline.com signed an agreement with the bank for the use of payment gateway to enable online financial transactions.

•

The bank, in association with the cellular services provider “Orange”, had launched the entire range of mobile banking services and mobile commerce services using Wireless Application Protocol (WAP) technology.

•

The bank had introduced a new scheme whereby it would provide loans to individuals for payment self-assessment tax on their properties in Bangalore.

•

The foreign investment promotion board had cleared the proposal of the HDFC Group to enter into a joint venture with Singapore telecom’s e-commerce company for providing a comprehensive range of B2B e-commerce solutions to companies in India.

•

The bank proposed to pick up an equity stake in Softcell trade and technologies ltd., a Mumbai based Software Company.

•

BPL mobile had tied up with HDFC Bank to offer Internet banking through the mobile phone.

•

The bank launched “e-instant car loans” a new scheme for offering customers a range of net-enabled loan products.

•

The bank launched depository services on the net.

•

The bank tied up with NSE.IT, a wholly owned subsidiary of the NSE, for providing payment gateway services for the latter’s Internet trading operations.

•

The bank had been identified as the best domestic commercial bank for the second consecutive year by financeasia.com, which provides a network for financial decision makers.

•

The Mumbai-based Geojit Securities ltd., had tied up with the bank for internet trading of shares.

•

Calcutta’s cellular services provider Modi Telstra, and the HDFC Bank had entered into a collaboration to provide mobile commerce in Calcutta.

•

The bank had got the kerala based Nedungadi bank as its first customer for its new joint venture company with the I-flex solutions.

•

The bank had had set a target of attaining a business of over Rs 15000 crore this fiscal mainly through expansion and new product launches, including a credit card.

•

The bank, in association with Tata Cellular, had launched mobile commerce service, for customers in Hyderabad and Vishakhapatnam.

•

The bank had tied up with about 25 equity brokerages for enabling third party transfer of funds and securities through its B2B portal-“enet”.

•

The bank had entered into an alliance with with Deloitte Haskins and Sells, a member firm of Deloitte and Touch, to offer banking services to its non-resident Indian customers.

•

The bank had launched its 123rd outlet at DSE building at Asaf Ali road, Delhi.

•

The bank had tied up with with Rajan Raheja owned Hathway for providing banking at home as part of net-over-cable initiative of the later in Mumbai.

•

The bank had launched its on-line bill payment facility in alliance with the Maharashtra state electricity board has also begun to offer bridge loans against fixed deposits of parent HDFC Corporation the financial institution.

•

The bank had tied up with portal brainvisa.com to retail education loans to students.

•

The Gujarat cellular operator Fascel, had signed up with the bank to introduce mobile commerce for the first time in the state.

•

The bank had tied up with BPL mobile for mobile commerce facility.

•

Cricketnext.com, a sports e-commerce site had tied up with HDFC Bank to provide an on-line payment gateways and marketing opportunities for a wide range of cricket sports gear on its online shop batnext.

•

Singapore-based Growasia.com had entered into an understanding with HDFC Bank and credit rating agency Icra, for picking equity in the company’s Indian subsidiary Gasia.com.

•

The HDFC Bank and Cosmos bank launched a co-branded ATM card.

•

The bank and Airtel launched their mobile banking service through WAP in Delhi.

•

The bank has launched wireless application protocol based mobile banking in Coimbatore and Trichy.

2001 •

The Bank had opened its first branch in Aurangabad.

•

HDFC Standard Life Insurance had entered into a memorandum of understanding with the Chennai based Indian Bank.

•

The Bank had launched the international Maestro debit card in association with Master card.

•

The Bank launched its credit card in June through link ups with Master card and Visa.

•

L Trade.com had entered into a starategic tie up with HDFC Bank to provide net banking services to online investors.

•

Standard Chartered Bank, HDFC Bank and Bharat Petroleum Corporation had joined the e-cash Forum which has been set up by the Smart Card Forum of India.

•

HDFC Bank has launched a new campaign for its e-age savings account.

•

HDFC Bank entered into a strategic tie up with Tally solutions Pvt. Ltd. to offer online real time accounting services to small and medium enterprises.

•

The Bank had opened four ATM outlets in Banglore at Coles Road, RT Nagar , Rajaji Nagar and Jaya Nagar on March 26.

•

HDFC Standard Life Insurance had launched a ‘Development Insurance Plan’ a low cost life insurance product developed specifically to meet the needs of economically weaker sections.

•

Two directors, Mr. S.S. Thakur and Mr Amit Judge, had resigned from the board of the bank effective from March 30th.

•

The bank files with US regulators to list more than 11 million American depository shares of the NYSE.

2002 •

The bank unveiled a new online account aggregation service “Oneview”.

•

The bank launched “Oneview” service to customers.

•

The bank launched its 9th branch in Karnataka.

•

The bank opened its branch in Mangalore.

•

The bank unveiled silver card in Hyderabad.

•

The bank opens first overseas representative office.

•

Mediclaim facilities to HDFC Bank gold cardholders.

•

The bank launched new products to its wealth management programme to increase its customer base. The bank introduced a non-interactive product, “Financial Planner”, which is available for all its customers for an annual fee starting from Rs 10000.The bank offered fee based advisory

programme to the mass effluent segment, which was easier offered to high net worth customers. The wealth management programme catered to the individual needs taking into account various factors such as customer’s age, financial goals and risk profile, which includes equity, MFs and debt instruments such as RBI relief bonds. •

Orange JV with the HDFC Bank.

2003 •

The bank unveiled resident foreign currency account.

•

The bank unveiled co-branded credit card with e-seva.

•

EPFO JV with the bank for IRS pension distribution.

•

The bank enters into agreement with HDFC to source housing loans.

•

HDFC Bank, IRCTC in tie up for online railway booking.

•

The bank inked pact with ANB for remittance services.

•

The bank introduced “HDFC Bank Health Plus Credit Card”.

•

Escotel tied up with HDFC Bank for global debit card.

•

The bank launched India’s first mobile payment solution.

•

The bank’s debt programme of Rs 400 crore had received triple A (ind) rating from CREDIT rating agency FITCH.

•

HDFC Bank began selling home loans of its promoter HDFC Corporation.

•

Board approval to allot 416400 equity shares to the employees of the bank under the Employee Stock Option Scheme.

2004 •

NMCE inked pact with HDFC Bank for warehouse receipts.

•

The bank has entered into an alliance with Clearing Corporation of India ltd.(CCIL).

•

The bank repurchases HDFC loans worth Rs 208 crore.

•

Launched Quickremit, a unique online service that enables NRIs in the US to send money to their relatives in India from the comfort of their homes.

•

Andhra bank had entered into an alliance with HDFC Bank for sharing its network of ATMs o march 29th

•

HDFC bank and Bahraini Saudi bank had announced an alliance to cater to service the needs of the NRIs in Bahrain.

•

The bank launched a new scheme for Maruti 800 buyers, providing 85% finance on the on-road price for the car for seven years.

•

The bank’s MD Mr. Aditya Puri has been awarded the management man of the year by the Bombay Management Association (BMA).

•

The bank had launched an online bill payment facility for its customers who are also subscribers to Tata Teleservices.

•

The bank joined hands with NCR Corporation to offer managed ATM services.

•

IKF finance ltd. had entered into a joint lending arrangement with HDFC Bank ltd.

2005 •

TMB forged alliance with HDFC Bank.

•

The bank inaugurated its first ATM in a hotel.

•

The bank tied up with International bank of Qatar to launch banking services in Qatar.

•

The bank launched loyalty rewards programme for its debit and credit cardholders under the name of “Insta Wonderz”.

•

The bank along with Mastercard International launched credit card targeted at a small and medium sized enterprise.

•

The bank unveiled credit card for farmers.

2006 •

HDFC Bank sets up two more branches in AP.

•

The bank signed an agreement with Tata Pipes to offer credit facilities

2007

to farmers across the country. •

The bank appointed Mr. Pandit Palande as an additional director of the bank at the board meeting held on April 24th 2007.

•

The bank informed that the board of directors of the bank at its meeting held on October 12th 2007 had appointed Mr. Paresh Sukthankar & Mr Harish Engineer as executive directors on the board of directors of the bank. The above mentioned persons have been senior employees of the bank since 1994 and had various positions of responsibility.

COMPOSITION OF THE BOARD

The Companies Act, 1956, the Banking Regulation Act, 1949, governs the composition of the Board of Directors of the bank and the listing requirements of the Indian stock exchanges where the securities issued by the bank are listed. The board has strength of nine 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. All the directors have made necessary disclosures regarding committee positions occupied by them in other companies.

Mr. Jagdish Kapoor, Mr. Aditya Puri, Mr. Keki Mistry, Mrs. Renu Karnad and Mr Vineet Jain are non-independent directors on the board.

Mr. Arvind Pande, Mr. Ashim Samanta, Mr. Gautam Divan and Mr. C M Vasudev are independent directors on the board.

Mr. Keki Mistry and Mrs. Renu Karnad represent HDFC Ltd on the board of the bank.

The Benett & Coleman group on the board of the bank nominates Mr. Vineet Jain.

HDFC BANK’S PRODUCTS AT A GLANCE

The various products, which are provided by HDFC BANK to be availed by its customers, are summarized as:-

 ACCOUNTS AND DEPOSITS  Regular Savings Account  Savings Plus Account  Savings Max Account  No Frills Account  Institutional Savings Account

 Salary Accounts -

Payroll Account

Classic Account

Regular Account

Premium Account

Defence Account

 Kid's Advantage Account  Pension Saving Bank Account  Family Savings Group  Kisan No Frills Savings  Kisan Club Savings  Current Accounts -

Plus Current Account

Trade Current Account

Premium Current Account

Regular Current Account

Reimbursement Current Account

RFC - Domestic Account

Flexi Current Account

 Fixed Deposits

Regular Fixed Deposit

5 Year Tax Saving Fixed Deposit

Super Saver Facility

Sweep-in Facility

 Demat Account  Safe Deposit Lockers

 LOANS  Personal Loans  Home Loans  Two Wheeler Loans  New Car Loans  Used Car Loans  Express Loans Plus  Gold Loan  Educational Loan  Loan Against Securities  Loan Against Property  Loans Against Rental Receivables

 Health Care Finance  Tractor Loans  Commercial Vehicle Finance  Working Capital Finance  Construction Equipment Finance  Warehouse Receipt Loans

 INVESTMENTS AND INSURANCE SERVICES  Mutual Funds  Insurance  General & Health Insurance  Bonds  Knowledge Centre  Equities & Derivatives  Mudra Gold Bar

 FOREX SERVICES  Products & Services  Trade Services  Forex Services Branch Locator

 RBI Guidelines  Forex Limits

 CARDS  Credit Cards -

Silver Credit Card

Value Plus Credit Card

Health Plus Credit Card

Gold Credit Card

Titanium Credit Card

Woman's Gold Credit Card

Platinum Plus Credit Card

Visa Signature Credit Card

World MasterCard Credit Card

Corporate Credit Card

Business Credit Card

 Debit Cards -

EasyShop International Debit Card

EasyShop Gold Debit Card

EasyShop International Business Debit Card

EasyShop Woman's Advantage Debit Card

EasyShop NRO Debit Card

Kisan Card

 Prepaid Cards -

ForexPlus Card

GiftPlus Card

FoodPlus Card

MoneyPlus Card

 PAYMENT SERVICES -

NetSafe

Merchant Services

Prepaid Refill

BillPay

Visa BillPay

InstaPay

DirectPay

Visa Money Transfer

e-Monies Electronic Funds Transfer

Excise & Service Tax Payment

Online Payment of Direct Tax

Religious Offerings

Donate to Charity

 BANK ACCESS SERVICES

NetBanking

OneView

InstaAlerts

MobileBanking

ATM

PhoneBanking

Email Statements

Fixed Deposits

HDFC Bank offers four types of Fixed Deposits. They are: -

Regular Fixed Deposit

5 Year Tax Saving Fixed Deposit

Super Saver Facility

Sweep-in Facility

By Fixed Deposit you can earn a higher income on your surplus funds by investing those with us. We provide security, trust and competitive rate of interest.

Believe in long-term investments and wish to earn higher interests on your savings, then it’s the time to invest your money in our Fixed Deposit and get up to 9.50% on HDFC Bank Fixed Deposit with an additional 0.50% for Senior Citizens. Flexibility, Security and High Returns all bundled into one offering NO PENALTY if you withdraw part of the FD in times of need.

Features & Benefits:-

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 before maturity of the rollover deposit.

Higher rate of interest on Fixed Deposits for Senior Citizens.

Interest Rates

When you open a fixed deposit with HDFC Bank •

Your interest is calculated on a quarterly basis for deposits of 6 months and above

•

For those deposits with tenure of below 6 months, your interest is calculated at maturity as Simple Interest. The period of Fixed Deposit is calculated in number of days.

•

Interest for re-investment is calculated every quarter, and the Principal is increased to include interest earned during the previous quarter.

•

Tax at source is deducted as per the Income Tax regulations prevalent from time to time.

Note: Interest rates are subject to change from time to time. Applicable interest rates will be given as on the date of receipt of the funds by the bank.

When booking FD through Net Banking please note the actual interest rate being applied on the "Confirm" screen. This screen appears before you confirm

your

request

for

opening

new

FD.

In order to see the latest information, we request you to clear your browsers cache to see the updated interest rates.

DOMESTIC TERM DEPOSITS

Period

Amount

Interest

**Senior Citizen

Rate (per

Rates (per

annum)

3.00%

3.50%

August 6, 2007

5.50%

6.00%

August 6, 2007

6.00%

6.50%

July 3, 2008

6.00%

6.50%

July 3, 2008

6.25%

6.75%

July 3, 2008

7.00%

7.50%

July 3, 2008

Effective From

Below Rs.15 7 - 14 days Lacs Below Rs.15 15 - 29 days Lacs Below Rs.15 30 - 45 days Lacs Below Rs.15 46 - 60 days Lacs Below Rs.15 61 - 90 days Lacs 91 - 99 days

Below Rs.15

Lacs Below Rs.15 100 - 101 days

7.75%

8.25%

July 3, 2008

7.00%

7.50%

July 3, 2008

8.00%

8.50%

July 3, 2008

8.25%

8.75%

July 3, 2008

8.00%

8.50%

July 3, 2008

9.00%

9.50%

July 3, 2008

8.75%

9.25%

July 3, 2008

Lacs Below Rs.15 102 - 180 days Lacs 6 months 1 day Below Rs.15 - 6 months 14 Lacs days 6 months 15 days - 6 months 16

Below Rs.15 Lacs

days 6 months 17 days - 9 months 14

Below Rs.15 Lacs

days 9 months 15 days - 9 months 16

Below Rs.15 Lacs

days 9 months 17

Below Rs.15

days - 1 year

Lacs

1 year 1 day - 1

Below Rs.15

year 14 days

Lacs

1 year 15 days -

Below Rs.15

1 year 16 days

Lacs

1 year 17 days -

Below Rs.15

2 years

Lacs

2 years 1 day -

Below Rs.15

2 years 14 days

8.75%

9.25%

July 3, 2008

9.50%

10.00%

July 3, 2008

8.75%

9.25%

July 3, 2008

9.00%

9.50%

July 3, 2008

9.50%

10.00%

July 3, 2008

9.00%

9.50%

July 3, 2008

9.00%

9.50%

July 3, 2008

9.00%

9.50%

July 3, 2008

Lacs

2 years 15 days Below Rs.15 - 2 years 16 Lacs days 2 years 17 days

Below Rs.15

- 3 years

Lacs

3 years 1 day -

Below Rs.15

5 years

Lacs

5 years 1 day -

Below Rs.15

8 years

Lacs

Interest rates are subject to change from time to time. The bank will give



applicable interest rates as on the date of receipt of the funds. When booking FD through NetBanking please note the actual interest rate being applied on the "Confirm" screen. This screen appears before you confirm your request for opening a new FD. ** Only Senior Citizens / Retired Personnel (60 years and above) who are



Resident Indians are eligible. The special rates are applicable only for INR deposits. *** The FD rate applicable for a monthly interest option will be a



discounted rate over the standard FD Rate. Please contact the nearest Branch for further information. ****For interest rates on Fixed Deposits for Rs. 15 Lacs and above, please



contact your nearest HDFC Bank branch. Effective 01st Dec'06, the interest rate applicable for premature closure of



deposits will be lower of : •

the original rate at which the deposit has been booked OR

•

The base rate applicable for the tenure for which the deposit has been in force with the Bank.

The base rate is the rate applicable to deposits of less than Rs.15 lacs.

Eligibility The following can apply for a Regular Fixed Deposit •

Resident Individuals

•

Hindu Undivided Families

•

Sole Proprietorship Firms

•

Partnership firms

•

Limited companies

•

Trust Accounts

•

An initial deposit of Rs. 10,000/- is required to open a Fixed Deposit. Add-ons at a minimum of Rs.5,000/-.

Tax Deductions For Re-investment Fixed Deposits The following will be applicable for a Regular Fixed Deposit •

TDS will be deducted when interest payable or reinvested per customer, per branch, exceeds Rs 10,000 in a financial year.

•

A consolidated Annual TDS Certificate will be mailed to you after the end of the financial year, including details of all TDS deductions during the year.

Applicable TDS rates are: Resident Individuals &

Tax Rate

Surcharge

Education Cess

TOTAL

10%

----

10.30%

10%

11.33%

Tax Rate

Surcharge

Education Cess

TOTAL

20%

---

20.60%

20%

10%

22.66%

HUF Payment upto 10 lacs Payment equal to & above 10 lacs

Corporate Entity Payment upto 1 crore Payment equal to & above 1 crore

NRO

Tax Rate

Surcharge

Education Cess

TOTAL

30%

----

30.90%

30%

10%

33.99%

Tax Rate

Surcharge

Education Cess

TOTAL

10%

----

10.30%

10%

11.33%

Tax Rate

Surcharge

Education Cess

TOTAL

10%

----

10.30%

Payment upto 10 lacs Payment equal to & above 10 lacs

Firms Payment less than 1 crore Payment equal to & above 1 crore

Co-operative Societies & Local Authority

If you are exempt from paying tax, you need to present Form 15H when you open a Fixed Deposit and subsequently at the beginning of the following financial year. At the end of the financial year, the TDS will be deducted on the basis of interest accrued on the Fixed Deposit (s) even if this interest has not been credited.

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 - 8.50% p.a, Senior Citizen rate - 9.00%

•

No Partial/Premature withdrawal allowed.

•

Sweep-in not allowed.

•

No OD or pledge allowed.

•

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.

Note: Interest rates are subject to change from time to time. Applicable interest rates will be announced as on the date of receipt of the funds by the bank.

Eligibility The following can apply for a 5 Year Tax Saving Fixed Deposit •

Resident Individuals

•

Hindu Undivided Families

An initial deposit of Rs. 100/- is required to open a Tax Saving Fixed Deposit.

Interest Rates When you open a Fixed deposit with HDFC Bank •

Your interest is calculated on a quarterly basis

•

Interest for re-investment is calculated every quarter, and the Principal is increased to include interest earned during the previous quarter.

•

Tax at source is deducted as per the Income Tax regulations prevalent from

time

time.

Interest rate - 8.50% p.a., Senior Citizen rate - 9.00%** Note: Interest rates are subject to change from time to time. Applicable interest rates will be announced as on the date of receipt of the funds by the bank.

** Only Senior Citizens / Retired Personnel (60 years and above) who are Resident

Indians

are

eligible.

***The FD rate applicable for a monthly interest option will be a discounted rate over the standard FD Rate. Please contact the nearest Branch for further information.

Tax Deductions for Re-investment Fixed Deposits

The following will be applicable for a 5 Year Tax Saving Fixed Deposit •

TDS will be deducted when interest payable or reinvested per customer, per branch, exceeds Rs 10,000 in a financial year.

•

A consolidated Annual TDS Certificate will be mailed to you after the end of the financial year, including details of all TDS deductions during the year.

Applicable TDS rates are:

Resident Individuals &

Tax Rate

Surcharge

Education Cess

TOTAL

10%

----

10.30%

10%

11.33%

HUF Payment upto 10 lacs Payment equal to & above 10

lacs

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.

Features & Benefits

•

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

•

Choose between a Saving 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.

Eligibility

The following are eligible to open a Super Saver Account

•

Resident

Individual

(sole

joint

account)

Hindu Undivided Family •

A minimum amount of Rs 25,000/- for a minimum tenure of 6 months is required to open a Super Saver Account, in addition to a Zero Balance Savings Account.

•

Only Senior Citizens / Retired Personnel (above 60 years of age) who are Resident Indians are eligible for the Senior Citizen rate on the INR fixed deposit.

Note: Minors, Trusts, Associations, Clubs, and Societies, Firms, Companies, NRIs, and Foreign Nationals cannot avail this facility. As per the Finance Bill, 2006, all fees & charges mentioned in the Tariffs, Charges or Fees Brochures will attract Service Tax @12% & Education Cess @3% of the service tax amount effective 11th May, 2007. The same will appear as separate debits in the statements.

Interest Rates

Earn the interest of a Fixed Deposit, which varies according to the tenure of your deposit. For the amount withdrawn, the applicable rate is only 2% above the fixed deposit rate for the period that the money is used. If your Savings Account has a credit balance, you will also earn 3.50 % paid into your account quarterly, on the funds existing in your Savings Account.

In effect, the Super Saver Account ensures that you earn a higher interest rate than you would with a Regular Saving Account.

Do you wish to avoid taking overdrafts, and still take advantage of your Fixed Deposit? Then what you need is a Sweep-In Facility on your savings account. Link your Fixed Deposit to your Savings or Current Account and use it to fall back on in case of emergencies. A deficit in your Savings or Current Account is taken care of by using up an exact value from your Fixed Deposit. Since deposits are broken down in units of Re 1/-, you will lose interest only for the actual amount that has been withdrawn.

Features & Benefits

•

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

•

Earn higher interest on the money till it is swept-in, while the remaining Fixed Deposit continues to earn you interest.

•

Only an exact amount required to make up for the deficit in the Savings account is withdrawn from your Fixed Deposit (units of Re. 1/-) thereby minimizing interest loss.

•

Multiple deposits can be linked to the Savings account.

•

Flexibility in altering the period of deposit, maturity and payment instructions, principal amount and rollover mode.

•

You can avail of both, a Super Saver Facility as well as a Sweep-In Facility if you have linked your deposits to a Savings Facility.

•

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

•

Avail an International Debit Card and a Free cheque book on your Sweep-in Savings account.

Eligibility & Documentation

•

Only Resident Individuals and Hindu United Families are eligible for a Sweep-In Account

•

Sweep-In can be also offered on Fixed Deposit linked to a Current Account.

Fees Sweep-In with Savings Account

If you maintain a Fixed Deposit of Rs. 50,000/- or more, no service charges are applicable on the Savings Account. However, if the Fixed Deposit amount is below Rs. 50,000/-, then the following service charges will be applicable on the savings account:

The minimum average quarterly balance maintained must be Rs. 5,000/-. If your minimum average quarterly balance is less than Rs. 5,000/- a service charge of Rs 750/- will be levied per quarter. 78

Sweep-In with Current Account

In case of Current Accounts, the average balance applicable to the Current Account chosen by you, needs to be maintained irrespective of the value of the fixed deposit. Service charges applicable would be as per the Current Account selected by you. If the Fixed Deposit is held for less than 15 days, your interest for the amount transferred is forfeited.

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

AWARDS AND ACHEIVEMENTS WON BY THE HDFC BANK IN BANKING SERVICES

Finance Asia

'Best Bank and Best Cash Management Bank'

Country Awards for Achievement 2008 CNN-IBN

'Indian of the Year (Business)'

Nasscom IT User

'Best IT Adoption in the Banking Sector'

Award 2008 Business India

'Best Bank 2008'

Forbes Asia

Fab 50 companies in Asia Pacific

Asian Banker

Best Retail Bank 2008

Excellence in Retail Financial Services Asiamoney

Best local Cash Management Bank Award voted by Corporates

Microsoft & Indian

Security Strategist Award 2008

Express Group World Trade Center For outstanding contribution to international trade services. Award of honour Business Today-

One of India's "Most Innovative Companies"

Monitor Group survey Financial Express-

Best Bank Award in the Private Sector category

Ernst & Young Award Global HR

'Employer Brand of the Year 2007 -2008' Award - First

Excellence Awards - Runner up, & many more Asia Pacific HRM Congress: Business Today

'Best Bank' Award

 YEAR 2007

Business Today-

One of India's "Most Innovative Companies"

Monitor Group survey

Financial Express- Best Bank Award in the Private Sector category Ernst & Young Award Global HR

'Employer Brand of the Year 2007 -2008' Award - First

Excellence

Runner up, & many more

Awards - Asia Pacific HRM Congress: Business Today

'Best Bank' Award

Dun & Bradstreet

'Corporate Best Bank' Award

– American Express Corporate Best Bank Award 2007 The Bombay

'Best Corporate Social Responsibility Practice' Award

Stock Exchange and Nasscom Foundation's Business for Social Responsibility Awards 2007

Outlook Money & Best Bank Award in the Private sector category. NDTV Profit 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

 YEAR 2006

Business Today

Best Bank in India.

Forbes Magazine

One of Asia Pacific's Best 50 companies.

Business world

Best listed Bank of India.

The Asset

Best Domestic Bank.

Magazine's Triple A Country Awards Asia money

Best Local Cash Management Bank in Large and Medium

Awards

segments.

Euro money

"Best Bank" in India.

Awards

 YEAR 2005

Asia money

Best Domestic Commercial Bank

Awards Asia money

Best Cash Management Bank - India.

Awards 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

Best Domestic Bank in India Region – 2005

A Country Awards The Business

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

Today-KPMG

2005

Survey The Business

"Best Bank in India" for the third consecutive year in 2005.

Today-KPMG Survey Economic Times - "Most Customer Responsive Company - Banking and Avaya Global

Financial Services – 2005

Connect Customer Responsiveness Awards

 YEAR 2004

Asia money

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

Awards Asia money

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

Awards Asia money

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

Awards

polls)

Asia money

Best Overall Domestic Trade Finance Services in India - 2004

Awards Asia money

Most Improved company for Best Management Practices in

Awards

India – 2004

Business World

One of India's Most Respected Companies - 2004 86

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

Best Domestic Bank in India – 2004

A Country Awards

 YEAR 2003

Forbes Global

Best Under a Billion, 200 Best Small Companies - 2003

The Asset Triple A

Best Domestic Bank in India -2003

Country Awards Business World -

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 87

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

There have been some other proud moments for the HDFC Bank as well. Some of them worth mentioning are: -

London-based Euro money 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 Asia money 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 & 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.

COMPARISION BETWEEN DIFFERENT BANKS

Axis Bank

Axis Bank offered different types of fixed deposits like  Encash 24  Recurring Deposit

 Tax Saver Fixed Deposit

Documentation

An Individual, Hindu

A valid passport or a valid driving license

Undivided Family, Sole

An introduction by any other bank or an

Proprietorship Concern

introduction by an Axis Bank Savings Account holder for the last six months A photograph

Trusts

Copy of the Trust Deed Copy of the registration certificate Copy of the Resolution of The Trustees Authorizing the members concerned to open and operate the account Photographs of the members operating the account

Associations / Clubs

Bye-laws of the Association Copy of the Resolution by the board authorizing the members concerned to open and operate the account Photographs of the members operating the account

Partnership Firm

Partnership Deed Letter from partners approving the persons

concerned to open and operate the

account Photographs of the persons operating the account

Interest rate offered by Axis Bank is also nearly same with interest rate of HDFC Bank but the services offered by different bank are different. Like the documentation of HDFC Bank is quite easier or simpler in comparison to Axis Bank.

ICICI Bank

Fixed Deposit

Wide range of tenures

Choice of investment plans

Partial withdrawal permitted

Safe custody of fixed deposit receipts

Auto renewal possible

Loan facility available

Documentation Applicants must satisfy the following documentation requirements: •

Identity proof

•

Proof of communication address

•

Self cheque (if the applicant is not visiting the branch for account opening)

Proof of communication Identity Proof address (Any one of the following) (Any one of the following) Original letter of

Introduction by an existing

introduction from existing

and satisfactory customer as

bank along with KYC

address proof

cheque of the same Bank Driving License – Book type Latest Electricity Bill or laminated & embossed Voter Identity Card with

Certificate from the postal

KYC cheque for operating

office confirming address of

accounts.

applicant

Cash can be accepted for Term deposits. Employee Identity Card

Original Letter from Employer certifying the residential address of applicant. Signature of the employee has to be attested on the letter.

PAN Card

Telephone bills from any telephone service providers and mobile service providers (KYC cheque mandatory for mobile service providers)

Defence Dependent's card

Consumer gas connection card/book/Pipe Gas bill (same as electricity bill)

Ex-Service Man Card

Certificate from the ward/equivalent rank officer, maintaining election roll, certifying address of the applicant

Bar Council/Indian Medical

Registered and valid Lease/

Association Card/Senior

Leave agreement with copies

Citizen Card

of utility bills

PIO Booklet for returning

Post Office Savings Pass

NRIs

Book with KYC cheque

MAPIN card

Statement of account or Pass Book of a scheduled commercial bank with entries of at least last 3 months along with KYC cheque Premium Receipt from any life insurance company Certificate by Village Extension Officer (VEO)/Village Head or equal rank officers Domicile Certificate with communication address and photograph

FDs can be booked through the facility of Phone banking in HDFC Bank, while in ICICI Bank; this facility is not available and cannot be availed.

ANALYSIS OF SURVEY CONDUCTED

1. customers of HDFC Bank

yes 34% yes no no 66%

customers having fixed deposit in HDFC Bank

yes 13%

yes no

no 87%

customers having fixed deposit in other banks

yes 48% no 52%

yes no

4. customers satified with the services of their banks

don’t answer 5% no 38%

yes yes 57%

no don’t answer

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percentage of banks offering interest rate of more than or equal to 8.75%

don’t answer 9% yes 44%

yes no

no 47%

don’t answer

101

customers having knowledge that HDFC Bank provides loan against deposit

don’t answer 5%

yes 34%

yes no don’t answer

no 61%

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customers availing facility of prewithdrawal from their banks

don’t answer 8% yes no 38%

yes 54%

no don’t answer

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customers having knowledge thatthere is no penalty in case of withdrawal of money from FD in times of needs

don’t answer 8%

yes 28% yes no don’t answer

no 64%

SUGGESTIONS

Some of the suggestions, which came out by doing the above research and study, for enhancing and improving the value of savings account in different bank branches are: -

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 Fixed Deposits Penetration can be increased by calling our existing customers and by telling them about the features offered by the bank in their fixed deposit.

 Fixed Deposit Penetration can be increased by making a proper list of the customers of the bank so, that it can help us in identifying the people who will invest their money in fixed deposit.

 Arranging a small session once in a month in which the customers will be called can increase fixed Deposit Penetration.

 All the customers should be given same priority in terms of providing good quality and satisfaction in terms of product and services.

 Better queuing systems should be designed at the different bank branches counters so that customers should not have to wait for too long in queues in the bank branches.

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 In the analysis, it was found that very less people were aware about the schemes offered by us in the fixed deposits like NO PREWITHDRAWAL

CHARGES,

etc.

So,

the

information

regarding the products should be communicated to people so that the number of ‘prospects’ for the organization may increase. For this, innovative marketing and communication strategies need to be implemented.

CONCLUSION

As my project deals with the Fixed Deposits of the banks, an observation recorded is that people are not very keen on buying FDs as the interest rates are very low in comparison to products like mutual funds, shares, etc. and so people think that they are getting very less returns than expected on their investments.

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HDFC Bank’s tagline “WE UNDERSTAND YOUR WORLD” clearly reflects that the bank understands the needs and demands of its customers. Different people have different needs and HDFC Bank has always tried to give best possible products and services to the people. That is why; there are so many versatile products and services under different categories, which the bank avails to its customers.

HDFC Bank have always strived towards excellence and giving top priority in providing products and services with best features and benefits for its customers. As the HDFC Bank’s four work culture philosophies (i.e. operational excellence, customer focus, product leadership and people), clearly shows the bank’s attitude and commitment towards its customers. Any business organization can only thrive and prosper, if it keeps in mind the well being of its customers and how to provide the customers with customer satisfying products and services in terms of quality and satisfaction. HDFC Bank has been successful and a pioneer in achieving that, and so stands way ahead of its competitors.

For penetrating more market in terms of FDs, strategic marketing and communication with the people which could be the future customers of the HDFC Bank and providing them with the knowledge of the various services and

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products related to the Fixed Deposits is to be communicated so as to increase the market in terms of service, quality and also the number of customers. There is a great market opportunity in the urban, as well as rural areas, which has to be worked upon. More and more number of branches and value added services like Phone banking, Net banking etc. have to be increased so as more and more people of the society can avail and get informed of the hassle free services of the HDFC Bank. Various innovative marketing strategies like tele marketing, brochures, door-to-door marketing, shows and programmers in various places need to be carried out for making more and more people informed of the products coming under the Fixed Deposit category, and eventually leading to increase of market size and the number of future customers for the HDFC Bank.

BIBLIOGRAPHY

1.BOOKS & AUTHORS

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