Comparison of Icici Bank and Hdfc Bank

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Project Report

Strategic Analysis of ICICI Bank and its comparison with HDFC Bank

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Contents
Profile of the banks……………………………………………………………………………………….3

Financial Analysis of the two banks …………………………………………………………………... 4

Growth Strategies that ICICI bank can adopt…………………………………………………………9

Strategic Analysis………………………………………………………………………………………..10

Recommendations……………………………………………………………………………………….13

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1. Profile of the banks
ICICI Bank
ICICI Bank is India's second-largest bank and offers a wide range of banking products and financial services to corporate and retail customers through a variety of delivery channels and through its specialized subsidiaries in the areas of investment banking, life and non-life insurance, venture capital and asset management.

The Bank currently has subsidiaries in the United Kingdom, Russia and Canada, branches in United States, Singapore, Bahrain, Hong Kong, Sri Lanka, Qatar and Dubai International Finance Centre and representative offices in United Arab Emirates, China, South Africa, Bangladesh, Thailand, Malaysia and Indonesia.

Mr. K.V. Kamath is the Chairman while Ms. Chanda Kochhar is the Managing Director and the C.E.O. as well. Ms. Chanda Kochhar, received the "Corporate Social Responsibility Award", at the 10th Asia Business Leaders Awards (ABLA) by CNBC and was also ranked 10th in the list of "Top 50 Women In World Business 2011", by Financial Times apart from many other distinguished awards.

HDFC Bank
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. 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 and People.

Mr. C.M. Vasudev is the Chairman of the bank while Mr. Aditya Puri is the Managing Director. The Bank's Board of Directors is composed of eminent individuals with a wealth of experience in public policy, administration, industry and commercial banking. 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.

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2. Financial Analysis of the two banks based on last 5 years data a. Deposits:

2006-07
2007-08
2008-09
2009-10
2010-11
HDFC ICICI HDFC ICICI HDFC ICICI HDFC ICICI HDFC ICICI
Ratio of Deposits to
Total Assets

75%

67%

76%

61%

78%

57%

75%

56%

75%

55%

Ratio of CASA to Total
Assets

43%

15%

41%

16%

35%

16%

39%

23%

40%

25%

The CASA to Total Asset Ratio for ICICI bank is very low as compared to that of HDFC bank despite the fact that CASA for ICICI bank is spectacularly higher than that of HDFC bank. This indicates the huge amount of total assets for ICICI bank.

As evident from the graph, the proportion of Term Deposits is significantly higher (67% for ICICI bank and 48% for HDFC bank) for either of the banks as compared to the savings & demand deposits.

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b. Advances:

Ratio of Advances to Total Assets is similar for both the banks...
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