ICICI BANKTAKING BANKING TO A NEW LEVEL

DAKSH BHATNAGAR

INTRODUCTION TO BANKING SECTOR

Banks are the backbone of an economy.

Well developed Indian banking structure. Banks have now reached rural and remote areas as well.

The regulatory body of Indian banking system is Reserve Bank of India. Time and again, the regulator keeps a check on the economy to ensure it works smoothly.

Commercial Banks in India are of 4 types. These bank groups are:-

a) Public Sector Banks

b) Private Sector Banks

c) Foreign Banks

d) Regional Rural Banks

STRUCTURE OF INDIAN BANKING SYSTEM

INTRODUCTION TO ICICI BANK

Established by the Industrial Credit and Investment Corporation of India (an Indian financial institution) in 1955

Initially known as the Industrial Credit and Investment Corporation of India Bank, the bank changed its name to ICICI Bank. The parent company (Industrial Credit and Investment Corporation of India) was later merged with the bank.

In the 1990s, development financial institution to a diversified financial services group

Sales Turnover as on Dec 2013 – Rs. 114,550 crores** The figure is taken from moneycontrol.com

BUSINESS PROFILE

Type Private

Traded as BSE: 532174, NSE: ICICIBANK, NYSE: IBN, BSE SENSEX Constituent, CNX Nifty Constituent

Industry Banking, Financial services

Headquarters Mumbai, India

Presence Worldwide

Key people Mr. K.V. Kamath (Chairman)Ms. Chanda Kochhar (MD & CEO)

Products

Credit cards, Consumer banking, corporate banking, finance and insurance, investment banking, mortgage loans, private banking, wealth management

Website www.icicibank.com

SUBSIDIARIES

Domestic

1. ICICI Prudential Life Insurance Company Limited

2. ICICI Lombard General Insurance Company Limited

3. ICICI Prudential Asset Management Company Limited

4. ICICI Prudential Trust Limited

5. ICICI Securities Limited

6. ICICI Securities Primary Dealership Limited

7. ICICI Venture Funds Management Company Limited

8. ICICI Home Finance Company Limited

9. ICICI Investment Management Company Limited

10.ICICI Trusteeship Services Limited

11.ICICI Prudential Pension Funds Management Company Limited

SUBSIDIARIES

International

1. ICICI Bank UK PLC

2. ICICI Bank Canada

3. ICICI Bank Eurasia Limited Liability Company

4. ICICI Securities Holdings Inc.

5. ICICI Securities Inc.

6. ICICI International Limited

ACQUISITIONS

1996: SCICI Ltd. A diversified financial institution with headquarters in Mumbai

1997: ITC Classic Finance.

1998: Anagram Finance.

2001: Bank of Madurai

2002: The Darjeeling and Shimla branches of Grindlays Bank

2005: Investitsionno-Kreditny Bank (IKB), a Russian bank

2007: Sangli Bank.

2010: The Bank of Rajasthan (BOR) was acquired by the ICICI Bank in 2010 for 3,000 crores. RBI was critical of BOR's promoters not reducing their holdings in the company. BOR has since been merged with ICICI Bank.

PRODUCTS

POCKETS

Facebook app

Log into Facebook account, go to the official ICICI Bank fb page and click on the tab for ‘Pockets by ICICI Bank’. Customer then registers online with their debit card number and PIN, and selecting a new four digit PIN for subsequent logins.

Features:

1. Split n Share

2. Pay A Friend

Advantages

a. make payments to friends,

b. recharge prepaid mobile

c. book movie tickets

d. non-financial transactions like accessing a mini statement of their savings bank account, getting demat holding statements,

PRODUCTS

iWish

Flexible R.D product for savings account customers

iWish allows customers to save varying amounts of money at any time of their choice. Option of sharing wishes on Facebook. Friends and family can contribute to their account from any bank account.

No penalties if a customer misses his monthly contribution to the R.D

The min. duration is 6 months and the min. opening balance for the account is Rs. 500

PRODUCTSGREEN PRODUCTS AND SERVICES

a. Instabanking

1. Banking through internet banking, i-Mobile banking, IVR Banking

2. Ensuring Customers don’t travel to branches, reduces carbon footprint

b. Vehicle Finance

1. Auto loans offer 50% waiver on processing fee on car models which uses alternate mode of energy

2. The models identified for the purpose are, Maruti's LPG version of Maruti 800, Omni and Versa, Hyundai's Santro Eco, Civic Hybrid of Honda, Reva electric cars, Tata Indica CNG and Mahindra Logan CNG versions

c. Carbon Footprint Calculator

1. Inputs are region, user input of the distance traveled in a particular medium of transport daily, electricity consumed per month and LPG cylinder/piped natural gas used per month

AWARDS

2004

Best Bank in India Award presented by Euromoney Magazine

2007

ICICI Bank has been conferred the ‘Euromoney Award’ 2007 for the Best Bank in the Asia-Pacific Region

2009

Bags the "Best bank in SME financing (Private Sector)" at the Dun & Bradstreet Banking awards

2012

Was awarded the Best Bank (India) by Global Finance

2013

Won the Asian Banking & Finance Retail Banking Award 2013 for the Online Banking Initiative of the Year

PERFORMANCE IN TERMS OF SALES REVENUE

PERFORMANCE OF STOCK OVER THE YEAR

Source: moneycontrol.com

COMPETITORS

Banks Market Cap Net Interest Income Net Profit Total Assets

HDFC Bank 175,520.33 35,064.87 6,726.28 400,331.90

ICICI Bank 140,317.94 40,075.60 8,325.47 536,794.69

Axis Bank 63,614.35 27,182.57 5,179.43 340,560.66

Kotak Mahindra 58,214.95 8,042.49 1,360.72 83,693.68

IndusInd Bank 24,615.65 6,983.23 1,061.18 73,306.52

Yes Bank 12,833.15 8,294.00 1,300.68 99,104.12

ING Vysya Bank 10,697.00 4,861.58 612.96 54,836.45

JK Bank 7,152.17 6,136.79 1,055.10 71,743.32

Federal Bank 7,142.15 6,167.57 838.17 60,626.78

Karur Vysya 3,399.78 4,242.43 550.32 46,733.35

TAB BANKING

Powered with an advanced application on tablets, customers can now enjoy a faster and smoother account opening experience with ICICI Bank.

Tab Banking officer will come to a place of customer’s convenience, click your photograph and scan the necessary documents required to open an ICICI Bank account with the help of a tablet. The account gets activated within a day.

The costs of Tab banking are just one-tenth of that of branch banking, says Mr. KVS Manian, President, Consumer Banking.

Axis Bank and Kotak Mahindra bank have also started the practice.

TAB BANKING ADVANTAGES

Some benefits other than avoiding hassle of arranging documents and account activation within a day are:-

1. Check out ICICI Bank Offer Zone to avail exclusive offers and discounts on a variety of products and services

2. Branch Locator

3. Calculate Monthly Average Balance and Loan EMI

4. Understand how to use iMobile and Internet Banking through Demo videos

5. Know more about Health, Motor and Travel Insurance calculator

6. Know more about service charges

7. Brings down the percentage of rework from 7 percent to 1 percent

8. Would reduce turnaround time and cost to the bank

GRIEVANCE REDRESSAL

4 steps Step 1

1. Customer Care

2. Online submission of grievance

Step 2, Mr. Krishnan Govindan, Customer Service Head

Step 3, Mr. Shiva Tadikonda, Nodal Officer

Step 4, Mr. Sourabh Singh, Senior General Manager & Head, Customer Service

Respond within 7 business days

ROLE IN DEVELOPING INFRASTRUCTURE National Stock Exchange (NSE)

o promoted by India’s leading financial institutions (including ICICI Ltd.) in 1992 on behalf of the Government of India

Credit Rating Information Services of India Limited (CRISIL)o In 1987, ICICI Ltd along with UTI set up CRISIL as India's first professional credit

rating agency

National Commodities and Derivatives Exchange Limited (NCDEX)o Set up by ICICI Bank Ltd, LIC, NABARD, NSE, Canara Bank, CRISIL, Goldman

Sachs, IFFCO and PNB

Financial Innovation and Operations Pvt. Ltd.o With the help of ICICI it was setup in 2006 as a company that would provide

technology solutions and services to reach the underserved and under banked population of the country

Asset Reconstruction Company India Limitedo ICICI Bank together with other institutions, set up ARCIL in 2003, to create a

facilitative environment for the resolution of distressed debt in India

Credit Information Bureau of India Limited (CIBIL)

CONTROVERSIES

INHUMAN DEBT RECOVERY METHODS

Blamed of unfair recovery methods. Allegations were that the bank was using gangsters to recover the credit card payments and loans. The recovery agents exhibited inappropriate and, in some cases, inhuman behavior

Defaulters were insulted in public by the recovery agents

Recovery agents and bank employees started threatening the defaulters. In some cases, notes written by the bank's employees asking the defaulters to "sell everything in the house including family members", were found

The recovery methods led to suicides also. When investigated, suicide notes were found which spoke of the bank’s recovery methods as the reason of suicide

CONTROVERSIES

MONEY LAUNDERING ALLEGATIONS

Violated RBI guidelines and was exposed in a famous ‘CobraPost’ sting operation

March 14, 2013 - The online magazine ‘CobraPost’ released video footage from ‘Operation Red Spider’. High-ranking officials and some employees of ICICI Bank were caught agreeing to convert black money into white, an act in violation of Money Laundering Control Act

The Government of India and RBI ordered an inquiry following the expose.

On 15 March 2013, ICICI Bank suspended 18 employees and faced penalties from the Reserve Bank of India.

SOCIAL INITIATIVES

Primary Health Jharkhand Sahhiya Programme

Nutrition Programme In Baran, Rajasthan

Elementary Education School and Education Teacher Reform Programme in Rajasthan

Chhattisgarh Curriculum and text development programme

Skill Development & Livelihoods – Provide vocational and skill training for rural youth

Financial Inclusion Insurance Plan

Commercial Banking Systems

REFERENCES

http://en.wikipedia.org/wiki/ICICI_Bank

http://www.moneycontrol.com/financials/icicibank/balance-sheet/ICI02#ICI02

http://www.moneycontrol.com/competition/icicibank/comparison/ICI02#ICI02

http://www.icicibank.com/privilege-banking/personal/privilege-banking-advantage.html

http://icicibank.com/complaints/Complaints-step3.html

http://www.thehindubusinessline.com/economy/now-banking-on-tablets-to-win-customers/article5747094.ece