34586705-summer-training-report-on-standard-chartered-bank

SUMMER TRAINING REPORT

On

STANDARD CHARTERED BANK

Standard Chartered Bank Saving Account Comparison, Insurance and Mutual Fund

Submitted in partial fulfillment of the requirements of the two year Post Graduate Program (PGP).

Submitted by

Brijesh Kumar Singh

……………………………………………………………………………….

Roll No: PGP20095884

Batch: 2009-2011

IILM Institute for Higher Education

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ACKNOWLEDGEMENT

I take this opportunity to express my deep sense of gratitude to all those who have contributed significantly by sharing their knowledge and experience in the completion of this project work.

I am greatly obliged to Miss Anna Lungany, Placements, IILM, Gurgaon for providing me the right kind of opportunity and facilities to complete this venture.

My first word of gratitude is due to Mr. Ashish Agarwal, Trainee at Standard Chartered Bank, Office – Gurgaon, my corporate guide, for his kind help and support and for his valuable guidance throughout the project. I am thankful to him for providing me with necessary insights and helping me out at every single step.

My heartfelt thanks to my respected Faculty Guide namely Miss. Shweta Mehta Without her continuous help the project would not have been materialized in the present form. Her valuable suggestions helped me at every step.

Finally, I would also like to thank all my dear friends for their kind cooperation, advice and encouragement during the long and arduous task of preparing this report and carrying out the project.

At last but not the least, who are always at the top of my heart, my dear family members whose blessings, inspiration and encouragement have resulted in the successful completion of this project.

Brijesh Kumar SinghMBA Marketing & Banking

IILM Institute For Higher Education

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DECLARATION FORM

I hereby declare that the Project work entitled, Standard Chartered Bank Saving Account

Comparison, Insurance and Mutual Fund submitted by me for the partial fulfillment of the Post

Graduate Program (PGP) to IILM Institute for Higher Education, is my own original work and

has not been submitted earlier either to IILM or to any other Institution for the fulfillment of

the requirement for any course of study. I also declare that no chapter of this manuscript in

whole or in part is lifted and incorporated in this report from any earlier / other work done by

me or others.

Place : Gurgaon

Date : 28 June 2010

Signature of Student

Name of Student : Brijesh Kumar Singh

Address: _____________________________

_____________________________

_____________________________


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PREFACE

India is a developing country and we all know that banking sector plays a very important role. In development with the increasing use of banking and finance in every field, new trends in their technology and modern use are being evolved day to day to meet the requirements. In fact “BANKING” has become the need of today.

The purpose of PROJECT REPORT is to expose the students in the market and in the field of banking, finance and investments and to develop the ability in the students to deal with all types of customers.

Preparing project report in the summer vacations and undergoing the summer training is the indispensable part of the college period. It provides the opportunity to review what we have gained in the training period and also provides the way to convey the knowledge and ideas to others.

The present project provides the information on the “STANDARD CHARTERED BANK”.

Learning is not possible in solitude and has to have the support and able guidance of some people around us in various roles and capacities. The satisfaction and euphoria that accompanies the successful completion of any task would be incomplete without the mention of the people who made it possible because success is the epitome of hard work, undeterred missionary zeal, fast determination, and consideration.

Therefore, we consider it a pleasant duty to express our heartiest appreciation, gratitude, and indebtedness to our project guide Mr. Mr. Ashish Agarwal for his keen interest, sincere extortion, invaluable and pain taking excellent guidance, continuous calm endurance, inspiration and encouragement during each phase of the present project.


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Contents

Overview of the Banking System.............................................................6

History of Standard Chartered...............................................................16

Standard Chartered Bank in India..........................................................17

Saving account.......................................................................................37

Saving Account in Standard Chartered Bank.........................................37

Comparison of various bank’s Service and Charges with Standard Chartered Bank......................................................................................41

Conclusion.............................................................................................53

Insurance...............................................................................................54

Unit Linked Insurance Plan....................................................................56

ULIP in Standard Chartered Bank...........................................................58

CONCLUSION ABOUT MARKET POTENTIAL OF ULIPS............................62

Mutual funds.........................................................................................63

ULIP Vs. Mutual Funds...........................................................................78

SWOT Analysis OF Standard Chartered Bank.........................................85

CONCLUSIONS........................................................................................86

RECOMMENDATIONS FOR INCREASING MARKET SHARE OF STANDARD CHARTERED BANK..................................................................................87

RECOMMENDATIONS FOR ULIPS...........................................................91

LIMITATIONS..........................................................................................93

REFRENCES.............................................................................................94


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Overview of the Banking System

Until the 1950s, banking in India was carried on by a large number of banks,

many of them quite small. India is still primarily an agricultural country, with

an economic and social structure based largely on the village. The integration

of banking has been impeded by poor communications, by illiteracy, and by

the barriers of language and caste.

Modern banking in India is said to be developed during the British era. In the

first half of the 19th century, the British East India Company established three

banks – the Bank of Bengal in 1809, the Bank of Bombay in 1840 and the Bank

of Madras in 1843. But in the course of time these three banks were

amalgamated to a new bank called Imperial Bank and later it was taken over

by the State Bank of India in 1955. Allahabad Bank was the first fully Indian

owned bank. The Reserve Bank of India was established in 1935 followed by

other banks like Punjab National Bank, Bank of India, Canara Bank and Indian

Bank.

In 1969, 14 major banks were nationalized and in 1980, 6 major private

sector banks were taken over by the government. Today, commercial banking

system in India is divided into following categories.


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Central Bank

The Reserve Bank of India is the central Bank that is fully owned by the Government. It is governed by a central board (headed by a Governor) appointed by the Central Government. It issues guidelines for the functioning of all banks operating within the country.

Public Sector Banks

a. State Bank of India and its associate banks called the State Bank Group

b. 19 nationalized banks

c. Regional rural banks mainly sponsored by public sector banks

Private Sector Banks

a. Old generation private banks

b. New generation private banks

c. Foreign banks operating in India

d. Scheduled co-operative banks

e. Non-scheduled banks

Co-operative Sector

The co-operative sector is very much useful for rural people. The co-operative

banking sector is divided into the following categories.

a. State co-operative Banks

b. Central co-operative banks

c. Primary Agriculture Credit Societies


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Development Banks/Financial Institutions

IFCI

IDBI

ICICI

IIBI

NABARD

Export-Import Bank of India

National Housing Bank

Small Industries Development Bank of India

North Eastern Development Finance Corporation

Banking in India is so convenient and hassle free that one (individual, groups

or whatever the case may be) can easily process transactions as and when

required. The most common services offered by banks in India are as follow:

Bank accounts : It is the most common service of the banking sector. An

individual can open a bank account which can be either savings, current

or term deposits.

Loans : You can approach all banks for different kinds of loans. It can be

a home loan, car loan, personal loan, loan against shares and

educational loans.


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Money Transfer : Banks can transfer money from one corner of the globe

to the other by issuing demand drafts, money orders or cheques.

Credit and debit cards : Most banks offer credit cards to their customers

which can be used to purchase products and services, or borrow money.

Lockers : Most banks have safe deposit lockers which can be used by the

customers for storing valuables, like important documents or jewellery.

Structure of the Organized Banking Sector in India


http://en.wikipedia.org/wiki/Image:Scheduled_banking_structure_in_India.png

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Banking service for NRIs:

Non Resident Indians or NRIs can open accounts in almost all Indian banks.

The three types of accounts that NRIs can open are:

o Non-Resident (Ordinary) Account - NRO A/c

o Non-Resident (External) Rupee Account - NRE A/c

o Non-Resident (Foreign Currency) Account - FCNR A/c

Reserve Bank of India (RBI)

The central bank of the country is the Reserve Bank of India (RBI). Reserve

Bank of India was nationalized in the year 1949. The body of the central bank

consists of the Governor and four Deputy Governors, one Government official

from the Ministry of Finance, ten nominated Directors by the Government to

give representation to important elements in the economic life of the country,

and four nominated Directors by the Central Government to represent the

four local Boards with the headquarters at Mumbai, Kolkata, Chennai and New

Delhi. Local Boards consist of five members each Central Government

appointed for a term of four years to represent territorial and economic

interests and the interests of co-operative and indigenous banks. The need for

bank is:

To regulate the issue of banknotes

To maintain reserves with a view to securing monetary stability and


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To operate the credit and currency system of the country to its

advantage.

Functions of Reserve Bank of India

The Reserve Bank of India performs all the important functions of a central

bank.

Bank of Issue

The Bank has the sole right to issue bank notes of all denominations. The

distribution of rupee notes and coins and small coins all over the country is

undertaken by it as agent of the Government. The Reserve Bank has a separate

Issue Department which is concerned with the issue of currency notes. The

Reserve Bank of India is required to maintain gold and foreign exchange

reserves of Ra. 200 crores, of which at least Rs. 115 crores should be in gold.

The system as it exists today is known as the minimum reserve system.

Banker to Government

The second important function of the Reserve Bank of India is to act as

Government banker, agent and adviser. The Reserve Bank is agent of Central

Government and of all State Governments in India excepting that of Jammu

and Kashmir on all monetary and banking matters. The Reserve Bank has the

obligation to transact Government business, via. to keep the cash balances as

deposits free of interest, to receive and to make payments on behalf of the


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Government and to carry out their exchange remittances and other banking

operations. It makes loans and advances to the States and local authorities

Bankers' Bank and Lender of the Last Resort

The Reserve Bank of India acts as the bankers' bank. According to the

provisions of the Banking Companies Act of 1949, every scheduled bank was

required to maintain with the Reserve Bank a cash balance equivalent to 5%

of its demand liabilities and 2 per cent of its time liabilities in India. By an

amendment of 1962, the distinction between demand and time liabilities was

abolished and banks have been asked to keep cash reserves equal to 8.25%

per cent of their aggregate deposit liabilities. The minimum cash

requirements can be changed by the Reserve Bank of India.

The scheduled banks can borrow from the Reserve Bank of India on the basis

of eligible securities or get financial accommodation in times of need or

stringency by rediscounting bills of exchange. Since commercial banks can

always expect the Reserve Bank of India to come to their help in times of

banking crisis the Reserve Bank becomes not only the banker's bank but also

the lender of the last resort.


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Controller of Credit

The Reserve Bank of India is the controller of credit i.e. it has the power to

influence the volume of credit created by banks in India. It can do so through

changing the Bank rate or through open market operations. It can ask any

particular bank or the whole banking system not to lend to particular groups

or persons on the basis of certain types of securities.

The Reserve Bank of India is armed with many more powers to control the

Indian money market. Each scheduled bank must send a weekly return to the

Reserve Bank showing, in detail, its assets and liabilities. This power of the

Bank to call for information is also intended to give it effective control of the

credit system. The Reserve Bank has also the power to inspect the accounts of

any commercial bank.

The Reserve Bank of India, therefore, has the following powers:

(a) It holds the cash reserves of all the scheduled banks.

(b) It controls the credit operations of banks through quantitative and

qualitative controls.

(c) It controls the banking system through the system of licensing, inspection

and calling for information.

(d) It acts as the lender of the last resort by providing rediscount facilities to

scheduled banks.


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Supervisory functions

In addition to its traditional central banking functions, the Reserve bank has

certain non-monetary functions of the nature of supervision of banks and

promotion of sound banking in India. RBI has wide powers of supervision and

control over commercial and co-operative banks, relating to licensing and

establishments, branch expansion, liquidity of their assets, management and

methods of working, amalgamation, reconstruction, and liquidation. The RBI

is authorised to carry out periodical inspections of the banks and to call for

returns and necessary information from them. The supervisory functions of

the RBI have helped a great deal in improving the standard of banking in India

to develop on sound lines and to improve the methods of their operation

Promotional functions

The Bank performs a variety of developmental and promotional functions,

which, at one time, were regarded as outside the normal scope of central

banking. The Reserve Bank was asked to promote banking habit, extend

banking facilities to rural and semi-urban areas, and establish and promote

new specialised financing agencies. Accordingly, the Reserve Bank has helped

in the setting up of the IFCI and the SFC; it set up the Deposit Insurance

Corporation in 1962, the Unit Trust of India in 1964, the Industrial

Development Bank of India also in 1964, the Agricultural Refinance

Corporation of India in 1963 and the Industrial Reconstruction Corporation of

India in 1972. These institutions were set up directly or indirectly by the

Reserve Bank to promote saving habit and to mobilise savings, and to provide

industrial finance as well as agricultural finance. The RBI has set up the


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Agricultural Refinance and Development Corporation to provide long-term

finance to farmers.


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History of Standard Chartered

The Standard Chartered Group was formed in 1969 through a merger of two

banks: The Standard Bank of British South Africa founded in 1863, and the

Chartered Bank of India, Australia and China, founded in 1853.

The Standard Bank was founded in the Cape Province of South Africa in 1862

by John Paterson. Commenced business in Port Elizabeth, South Africa, in

January 1863.

The Chartered Bank was founded by James Wilson following the grant of a

Royal Charter by Queen Victoria in 1853.Chartered opened its first branches

in Mumbai (Bombay), Calcutta and Shanghai in 1858, followed by Hong Kong

and Singapore in 1859.

This friendly merger allowed both banks to capitalise on the expansion of

trade caused by the increased movement of goods from Europe to the East

and Africa.

In 1986 a hostile takeover bid was made for the Group by Lloyds Bank of the

United Kingdom. When the bid was defeated, Standard Chartered entered a

period of change. Provisions had to be made against third world debt

exposure and loans to corporations and entrepreneurs who could not meet

their commitments. Standard Chartered began a series of divestments notably

in the United States and South Africa, and also entered into a number of asset

sales.


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Since the early 90s, Standard Chartered has focused on developing its strong

franchises in Asia, the Middle East and Africa, using its operations in the

United Kingdom and North America to provide customers with a bridge

between these markets. Bank also focused on consumer, corporate and

institutional banking, as well as the provision of treasury services – areas in

which the Group has particular strength and expertise.

In the new millennium we acquired Grindlays Bank from the ANZ Group and

the Chase Consumer Banking operations in Hong Kong in 2000.

Standard Chartered Bank in IndiaStandard Chartered is a London based international bank with significant

operations in Asia, Africa, the Middle East and Latin America. The Standard

Chartered Group was formed in 1969 through a merger of two banks: The

Standard Bank of British South Africa founded in 1863, and the Chartered

Bank of India, Australia and China, founded in 1853.

Chartered Bank opened its first overseas branch in India, at Kolkata, on 12

April 1858. During that time Kolkata was the most important commercial city

and was the hub of jute and indigo trades. With the opening of the Suez Canal

in 1869 and the growth of cotton trade, Bombay replaced Kolkata as the main

commercial center. Hence Standard Chartered shifted its main operations to

Bombay. Today the Bank's branches and sub-branches in India are directed

and administered from Bombay with Kolkata remaining an important trading

and banking centre.


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To cater to diverse financial needs, Standard Chartered offers a wide range of

state-of-the-art banking products and services through its network of 90

branches in 31 cities across the country.

Some other fact about SCB

Over 50 nationalities are represented among our top 500 senior

executives.

SCB is the only international bank with over 90% profits from Asia,

Africa, and the Middle-East.

SCB is the only international bank with a long unbroken banking history

in India and China.

SCB is the largest international bank in India in terms of branch

network and profits

SCB is the only bank in the Falkland Islands.

SCB is one of three note issuing banks in Hong Kong.

Principles and Value

At Standard Chartered our success is built on teamwork, partnership

and the diversity of our people.

At the heart of our values lie diversity and inclusion. They are a

fundamental part of our culture, and constitute a long-term priority in

our aim to become the world's best international bank.

Today we employ 73,000 people, representing 115 nationalities, and

you'll find 61 nationalities among our 500 most senior leaders.


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We believe this diversity helps to fuel creativity and innovation,

supporting the development of exciting new products and services for

our customers worldwide.

SCB Stand for

Strategic intent

The world's best international bank

Leading the way in Asia, Africa and the Middle East

Brand promise

Leading by Example to be The Right Partner

Values

Responsive

Trustworthy

International

Creative

Courageous

Approach

Participation - Focusing on attractive, growing markets where we can

leverage our relationships and expertise

Competitive positioning - Combining global capability, deep local

knowledge and creativity to outperform our competitors


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Management Discipline - Continuously improving the way we work,

balancing the pursuit of growth with firm control of costs and risks

Commitment to stakeholders

Customers

Passionate about our customers' success, delighting them with the

quality of our service

Our People

Helping our people to grow, enabling individuals to make a difference

and teams to win

Communities

Trusted and caring, dedicated to making a difference

Investors

A distinctive investment delivering outstanding performance and

superior returns.

Regulators

Exemplary governance and ethics wherever we are.

Products and Services

Personal Banking:-


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Through our global network of over 1,700 branches and outlets, we offer

personal financial solutions to meet the needs of more than 14 million

customers across Asia, Africa and the Middle East.

Personal Banking Plans

Accounts

Debit Cards

Prepaid Cards

Credit Cards

Loans

Investment Services

Insurance

Online Services

Special Offers

NRI Accounts

Private Banking:-

Our Private Bank advisors and investment specialists provide customised

solutions to meet the unique needs and aspirations of high net worth clients.

Wholesale Banking:-

Headquartered in Singapore and London, with on-the-ground expertise that

spans our global network, our Wholesale Banking division provides corporate

and institutional clients with innovative solutions in trade finance, cash

management, securities services, foreign exchange and risk management,

capital raising, and corporate finance.


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SME Banking:-

SME Banking division offers a wide range of products and services to help

small and medium-sized enterprises manage the demands of a growing

business.

Term Loan

Express Trade

Trade Services & Working Capital

Business Installment Loan

International Trade Account

Loan/Overdraft Against Property

Islamic Banking:-

Standard Chartered Saadiq's dedicated Islamic Banking team provides

comprehensive international banking services and a wide range of Shariah

compliant financial products that are based on Islamic values.

Online Banking:-

Standard Chartered Online is an innovative Online Banking service that you

can tailor to suit your precise banking needs. It gives you convenient, round-

the-clock banking services ranging from day-to-day account transfer

transactions to real-time valuable financial information. Now you can manage

your finances anytime, anywhere.

Mobile Banking:-


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Standard Chartered Bank offer mobile banking to access your bank account

anytime and from anywhere in the world.

Features of mobile banking:-

Balance Information –View balances of your linked savings and current

accounts

Mini Statement – Get details on the last 3 transactions carried out on

your bank account

Cheque Book Request – You can now order for a cheque book from your

Mobile Phone!

Bank Statement Request – Bank Statement requests can be placed

through your Mobile phone

Different Types of Saving Account in Standard Chartered Bank

Standard chartered Bank offers basically 6 different type of saving account.

According to consumer needs it functioned and very useful.

aXcess plus account

Super value account

Parivaar account

No frills account

aaSaan account

2-in-1 account

Actually my survey has done in Metro city where only 4 types of saving

account runs. “No frills” and “aaSaan account” are not for Metro cities.


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Establishment of Standard Chartered Bank around the world

Country Year

Established

Country Year Established

United Kingdom 1853 Australia 1964

China, India, Sri Lanka 1858 Mexico, Oman 1968

Hong Kong, Singapore 1859 Peru 1973

Indonesia, Pakistan 1863 Jersey 1978

Philippines 1872 Brazil 1979

Malaysia 1875 Venezuela 1980

Japan 1880Falkland Islands,

Macau1983

Zimbabwe 1892 Taiwan 1985

The Gambia, Sierra

Leone, Thailand1894 Cameroon 1986

Ghana 1896 Nepal 1987

Botswana 1897 Vietnam 1990

USA 1902Cambodia, South

Africa1992

Bangladesh 1905 Iran 1993

Zambia 1906 Colombia 1995

Kenya 1911 Laos, Argentina 1996

Uganda 1912 Nigeria 1999

Tanzania 1917 Lebanon 2000

Bahrain 1920 Cote d’Ivoire 2001

Jordan 1925 Mauritius 2002


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Korea 1929 Turkey 2003

Qatar 1950 Afghanistan 2004

Recent strategic alliances and acquisitions

2005 and 2006 were historic years as Bank achieved several milestones with

a number of strategic alliances and acquisitions that will extend our customer

or geographic reach and broaden our product range.

We completed, rebranded and successfully integrated SC First Bank in

Korea, which to date is the biggest acquisition in our history.

We completed full integration between Standard Chartered Bank

Thailand and Standard Chartered Nakornthon Bank in October.

We formed strategic alliances with Fleming Family & Partners to expand

private wealth management in Asia and the Middle East.

We acquired stakes in ACB Vietnam and Travelex.

We acquired the business operations of American Express Bank in

Bangladesh.

We acquired a stake in Bohai Bank in Tianjin, China, making us the first

foreign bank to be allowed a stake in a local bank in China.

We acquired an additional 26% stake in Permata Bank through our

consortium with PT Astra International, thus giving the consortium a

total stake of 89%.

1957 – Eastern bank take over by Standard Chartered,

1965 – Bank of West Africa acquired


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1973 – The Hodge Group was acquired in the Uk

1979 – Union Bank of California Acquired

1983 - Standard Chartered Merchant bank Acquired Midland &

International Banks Limited

1993 – SCB acquires the First interstate bank of California

1996 – SCB Cameroon becomes 100% subsidiary.

1999 – SCB agrees to Acquire 89% of share Capital of Metropolitan Bank

of Lebanon

2000 – Grind lays bank acquired form ANZ bank

2000 – Chase Manhattan Card Acquired in Hong Kong

2004 – 63 % Stake Acquired in Pemata bank

2005 – Acquisition of Korea first bank in South Korea.

2006 – Hsinchu International Bank Acquired

We acquired a 25% stake in First Africa Group Holdings in June 2006.

2007 – American Express Bank Acquired

2007 – Acquisition of 74.9% Strategic Stake in India’s UTI Securities.

2007 – Union Bank of Pakistan Acquired

2009 - SCB Kolkata’s heritage building on Indian 5 Rupees Postal Stamp

and England Letter Envelop

2010 -

Standard Chartered – leading the way


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Standard Chartered PLC is listed on both the London Stock Exchange and the

Hong Kong Stock Exchange and is consistently ranked in the top 25 among

FTSE-100 companies by market capitalization.

Standard Chartered has a history of over 150 years in banking and operates in

many of the world's fastest-growing markets with an extensive global

network of over 1,400 branches (including subsidiaries, associates and joint

ventures) in over 50 countries in the Asia Pacific Region, South Asia, the

Middle East, Africa, the United Kingdom and the Americas.

As one of the world's most international banks, Standard Chartered employs

almost 60,000 people, representing over 100 nationalities, worldwide. This

diversity lies at the heart of the Bank's values and supports the Bank's growth

as the world increasingly becomes one market.

With strong organic growth supported by strategic alliances and acquisitions

and driven by its strengths in the balance and diversity of its business,

products, geography and people, Standard Chartered is well positioned in the

emerging trade corridors of Asia, Africa and the Middle East.

Standard Chartered derives over 90 per cent of profits from Asia, Africa and

the Middle East. Serving both Consumer and Wholesale Banking customers

worldwide, the Bank combines deep local knowledge with global capability to

offer a wide range of innovative products and services as well as award-

winning solutions.

Trusted across its network for its standard of governance and corporate

responsibility, Standard Chartered takes a long term view of the consequences


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of its actions to ensure that the Bank builds a sustainable business through

social inclusion, environmental protection and good governance.

Standard Chartered is also committed to all its stakeholders by living its

values in its approach towards managing its people, exceeding expectations of

its customers, making a difference in communities and working with

regulators.

Great Place to Work

Standard Chartered employs almost 60,000 people in 56 countries and

territories, representing over 100 nationalities. Demographic changes,

competition in our markets and our own rapid growth provide a bigger

challenge than ever to attract, develop and engage our employees to continue

to deliver strong results.

As we grow, we believe our diverse and inclusive approach provides engaging

opportunities for our employees to develop, both as individuals and as part of

a team. We are committed to creating a healthy, safe and fulfilling work

environment in which people can grow, individuals can make a difference and

teams can win.

Our approach to managing people is underpinned by four principles:

A focus on managing talent to identify, reward and retain talented

employees

Building a strengths-based approach by providing the skills to develop

individuals and teams by focusing on people's personal strengths


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A commitment to drive employee engagement through the development

of exceptional managers with the skills to identify and build talent

Creating a diverse and inclusive workplace that encourages our

employees to achieve their potential and support our growth

Priorities at Standard Chartered

At Standard Chartered, we believe that our future success depends on our

ability to deliver a sustainable business. Our 'building a sustainable business'

strategy will help us take a long-term view of the implications of everything

we do. This means taking responsible decisions that benefit our business, the

economy, society and the environment – and build the trust of all our

stakeholders.

Our 'building a sustainable business' strategy explicitly recognizes seven

areas where we and our stakeholders believe we are most likely to make the

greatest contribution to sustainability.

They are:

Sustainable lending – making sure when we lend money we are aware

of the environmental, social and governance risks attached to such

decisions and that we take steps to address them

Tackling financial crime – making sure that we have the right systems

in place to detect such things as fraud and money laundering and

exceed, rather than simply meet, increasingly stringent legal

requirements in this field


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Access to financial services – making sure we develop new ways for

those deprived of banking services to get proper access to finance so

that they can improve their standard of living and economic

independence

Responsible selling & marketing – making sure we treat customers

fairly and set the highest standards in service and transparency

Protecting the environment – making sure we not only minimize our

own direct impact on the environment but support others, such as

customers, to do the same. We also want to support the development

and commercialization of technologies and schemes that tackle

environmental threats like climate change

Great place to work – making sure that with our people, who represent

over 100 nationalities from over 50 countries, feel valued, included and

engaged. We're determined to attract, develop and retain the best

people and to leverage the strength the diversity of our people brings,

which is an incomparable advantage

Community investment – making sure we involve our employees and

utilise our core expertise, networks and resources to help communities

develop and economies to grow


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Governance

The governance structure we have set up for Sustainability provides strategic

direction for the Bank and ensures we continue to make progress with our

approach to sustainable development.

The Corporate Responsibility and Community Committee sit at the top of this

structure alongside the Remuneration, Audit and Risk, and Nomination

Committees of our Board. It is supported by a Group Sustainability team,

steering groups for specific programmes and our branches and offices in each

country we operate in.

The Committee is chaired by Mervyn Davies, the Group Chairman, and meets

quarterly. It drives the Sustainability agenda at Standard Chartered and is

responsible for responding to issues coming out of new Sustainability

legislation, regulation, stakeholder guidance and reporting and for making

sure our activities are aligned with our overall business strategy. It also

ensures we publish a Sustainability report, supported by accurate data, each

year, in line with best practice.

A dedicated Sustainability team, based in the London office, supports the

Committee, the Business and other Group functions. The role of the team is to

talk with stakeholders, monitor good practice and flag up potential trends and

emerging issues. It co-ordinates the collection of data and is responsible for

our annual Sustainability Review and web site, participating in thought

leadership events and raising our Sustainability profile outside the Bank.


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Nine Steering Groups or Committees put the Bank's strategy into action, co-

ordinate Group-wide initiatives and provide policy recommendations to the

Board, its various committees or the Corporate Responsibility and Community

Committee. They are:

Strategic Sourcing and Vendor Management Committee

Diversity Council

Environmental Steering Group

Health and Safety Steering Group

Group Risk Committee

Reputation Risk Committees

Seeing is Believing Committee

Living with HIV Advisory Committee

Community Partnership Boards

Because our business is spread across the globe in very different market

places, each Country Head is responsible for identifying and responding to

local Sustainability issues. It is the responsibility of each business unit to

adhere to policies that have been set on a global basis. Where local standards

exceed group set policies, the higher standard is adopted.

Engagement

Helping stakeholders understand the way we operate and the challenges we

face is fundamental to making progress with our 'building a sustainable

business' strategy.


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Engagement is a word used by many organizations, but it means something

very specific to Standard Chartered. It is the way we go about communicating

with three distinct but interconnected audiences:

Our own employees – we want them to really understand what

"Building a sustainable business" means

People and organizations that use or influence our products and

services – we want to work closely with them to develop and promote

sustainable services

People and organizations that have the power to make a wider

difference – we want to use our geographic reach to promote the need

for sustainable development

We have been working on our stakeholder engagement programme for some

years. Work in this area has recently increased as continue to build a clearer

picture of our global stakeholder audience including government departments

and agencies, socially responsible investors, academic institutions, business

associations and non-governmental organisations. In 2006 we invited 60 of

our key stakeholders to help us develop our 'building a sustainable business'

strategy. Their contributions – many of which are included in our 2006

Sustainability Review – helped us decide what our sustainable development

priorities should be.

Building a truly relevant stakeholder network is challenging, however, it is

extremely important that we continue to build our network in the years

ahead.


34 | P a g e

One-Stop Range of Products and Services

We have a full range of foreign exchange and risk management solutions to

meet the needs of clients across the world.

Standard Chartered Alternate Investment Group

Standard Chartered Bank's Alternate Investment Group focuses on distressed

and high-yield opportunities by investing in senior debt, mezzanine or equity

instruments. In addition, it provide asset management services to investment

banks, financial institutions and value investors as well as advisory services to

companies in financial distress or requiring assistance with their capital

structure.

Our Business

Investments. Our investment program is aimed at both the primary and

secondary markets. We provide liquidity to the distressed and high yield

market through the following:

Acquisition of distressed asset portfolios

Investments in loans and bonds

Offering priority loans (DIP), subordinated or mezzanine debt

Offering structured investments

Investments in equity

Investments in hybrid structures


35 | P a g e

Asset Management. We offer a range of services under asset management

including origination of investment opportunities, due diligence, loan

servicing (monitoring and recovery) for single assets and portfolio

investments. The Bank has a successful track record of managing and

resolving non-performing loans.

Corporate Advisory. We offer corporate advisory services to companies

requiring capital structuring and to companies in financial distress. Our range

of services includes:

Assessment of strategic issues, ranging from corporate and capital

structures to potential mergers and sale of businesses

Development and implementation of creative and comprehensive

solutions to address clients' various complex issues such as capital

restructuring exercise

Assistance in implementing the appropriate debt and equity financing

structure

Our Strengths

Professional Team. We have a large experienced team of skilled individuals

who have developed a reputation for competency in valuation, due diligence,

acquisition and asset management in the distressed and high yield market.

Our local market knowledge and workout skills offer value to our clients.

Network. We leverage Standard Chartered Bank's network in our core

markets to provide us on-the-ground knowledge and early access to


36 | P a g e

situations. The Bank's client franchise offers investment opportunities while

Alternate Investment Group's strong relationships with investment banks,

financial institutions, brokers and value investors provides a valuable source

of investors. We utilise superior information to maximise value for our clients.

Positioning. The distressed and high-yield markets in Asia,Africa and the

Middle East offer attractive revenue generating opportunities. The Bank is

well positioned in these markets to enable Alternate Investment Group to

deliver value to the Bank and our clients.


37 | P a g e

Saving account

A savings account typically refers to an account in which one places money to

earn a small amount of interest. The savings account funds are usually easily

accessible, though some banks do charge for withdrawing money early. In

most cases, people can withdraw money from a savings account at any time, at

least at any time the bank is open, or one has access to the bank’s ATM.

Saving Account in Standard Chartered Bank

5.1 aXcess plus account:-

The Standard Chartered aXcess Plus Account comes with a globally valid debit

- cum - ATM card which allows customers to aXcess all Standard Chartered

Bank ATMs and provides instant cash at all Visa Network ATMs in India and

abroad. This account provides unparalleled access to your money through a

variety of channels.

Highlights:-

Category Regular

Minimum AQB Rs. 60,000 if balance in linked saving

a/c is atleast Rs 10,000

Interest Rate 3.5%

Card offered ATM cum Debit Card

ATM Cards

Replacement of Pin Rs 50

Lost card re-issuance Rs 100


38 | P a g e

Some features:-

FREE Unlimited Visa ATM transactions* (Cash withdrawal and balance

enquiry)

FREE Standard Chartered Bank branch access across the county

FREE Doorstep Banking

FREE Demand Drafts/Pay Orders (drawn at SCB locations)

FREE Payable at Par Chequebook

International Debit Card

Extended Banking Hours

Phone banking, Net banking, Multi-city banking, 365 days branches

Unique free insurance benefits- lost card, purchase protection.

* Available on maintenance of average quarterly balance of Rs 15,000/-

5.2 SuperValue Saving Account:-

The unique SuperValue savings account from Standard Chartered is proof that

the best things in life come free. With an average quarterly balance of just Rs.

50,000, you get a host of services from Standard Chartered absolutely free.

Some features:-

Free globally valid Debit-cum-ATM card.

Free Access to 6500 ATMs in India.

Free Doorstep Banking.

Free Payable at Par cheque book/ account statements / DDs

Free Bill Pay.

Free Inter Bank Funds Transfer.


39 | P a g e

Free Foreign Inward Remittance Certificates.

Other benefits of the SuperValue account:

Full suite of complimentary banking services including credit cards,

loan products and capital market services.

Globally valid debit card: Make purchases at over 12 million merchant

outlets and withdraw cash at over 810,000 ATMs worldwide using

funds from your account

Enjoy extended Banking hours at all our branches, and Speed Cheque

Clearing and Metro Clearing facilities.

Multicity Banking: Access your account even when you are out of town

24-hour branches, 365 day branches available at select locations

Phone banking

Internet banking

Free Investment Advisory Services to assist you in investing in a range

of mutual funds

5.3 Parivaar Account:-

This family account allows you to maintain your individual identity while

allowing you to tap your family's financial strength. Parivaar is a unique

Wealth Management Solution from Standard Chartered Bank that offers your

family flexibility, convenience and essential tools for wealth accumulation and

preservation.

Some features:-

Your family can maintain individual savings accounts with the benefit of

clubbing balances in grouped accounts.


40 | P a g e

Anytime, anywhere access to accounts through ATMs, Phone Banking

and Online Banking.

Globally valid ATM-cum-debit card can be used at 3,26,000 merchant

outlets in India and 14 million outlets worldwide.

5.4 2-in-1 Account:-

The 2-in-1 account gives you the facility of linking your fixed deposits with a

savings or current account. In case of any shortfall in the savings or current

account, funds will be automatically swept in from the linked fixed deposits,

thus giving you a combination of both liquidity and higher returns.

And that’s not all either. In case you need to withdraw amounts in excess of

what is available in your savings or current account, we will break your

deposit for the exact amount you require. The rest of the deposit continues

earning the original high interest.

Some features:-

Earn fixed deposit interest rates

Enjoy the flexibility of a Savings or a Current Account

Get a free personalized cheque book and Debit/ATM card

Withdraw money whenever you need it

Deposit more money in your account to earn a higher rate of

interest by placing subsequent deposits


41 | P a g e

Comparison of various bank’s Service and Charges with Standard Chartered Bank.

S.n

o Features

Standard

Chartered Yes Bank Barclays HDFC

1 Avg.Quaterly Bal. 25,000 25,000 1,000 20,000

2 Rate of Interest 3.50% 3.50% 3.50% 3.50%

3 Internet Banking Free Free

25(Per

month) Free

4 Doorstep Banking Free Free Free

5 Phone Banking Free Free 100 50

7 DDs n payorders Free

5 DDs in Yes

Bank Location

&

2 DDs in

Correspondin

g bank

Location ---

Free DD

up to 1

Lac Rs

Per day

in Bank

Location

9

Quarterly

Statement Free Free Free Free

10 Monthly Statement Free Free Free Free

12 Pass Book Free Free Free

13 Duplicate Pass book 100

14 At Par Cheque Free

25 Txns PM

Free 1 Lac PM 2 Lac PM

15 Debit card International International Debit Card Gold


42 | P a g e

Platinum

Debit Car Silver

Debit

Card

17 Cash Back

1 % Cash

Back on all

Txns --- ---

1% Cash

back on

Shopping

Txns

21

Debit Card Txns

Limit

2 Lacs ATM

& 2 lakh

Shopping

25

50,000

ATM &

50,000

Shopping

1 Lac

ATM & !

Lac

Shopping

22 Account closure 500 50 500 100

23 Stop Payment

(a) Single cheque 100 100 100 50

(b) range of

cheques 200 100 100 100

1. Saving Account Potential Survey

A survey was being conducted as a part of project in Delhi NCR region to

analyze the market potential of saving account specially SBC’s saving account

in comparison to other banks. The total sample size of the survey is 60.

16.1 Objective:-


43 | P a g e

To know the customers interests in saving account

To know the present scenario of saving account

To know what’s the service facility customer want.

To know the how much customers want to more facilities in using bank

account

To understand, are they wanted to open a saving account in another

bank, if yes then what is the reason behind it.

16.2 Research Methodology

The research methodology consisted of two phases. Phase one consisted of

data collection. It included primary data collection as well as secondary data

collection. Primary data collection consisted of the survey process. People of

different age group as well as income category were asked to fill a common

questionnaire. Secondary data collection consisted of data collection from

internet and books.

The second phase consisted of analyzing the primary data. The analysis

consisted of graphs and inferring results or trends from those graphs. Some

general conclusions could be drawn from the primary data.


44 | P a g e

Survey Analysis

1. Male Vs Female

Percentage

No. of People

2. No. of people participated in survey on the basis of different

age group.

20-30; No. of People; 26; 43%

30-40; No. of People; 17; 28%

40-50; No. of People; 14; 23%

50-60; No. of People; 3; 5%

No. of People Different Age Group


45 | P a g e

In this survey total 60 persons participated. Out of 60, 54 are male and 6 are

female. If we take the people age group wise then 20-30(44%), 30-40(28%),

40-50(23%) and 50-60(5%). This shows that younger generation more attract

towards privatisation means private sector.

3. No. of people participated in survey from different

occupation.

PercentageNo. of People


46 | P a g e

4. No. of people from different income group.

2.5 - 3.5; No. of People; 12; 20%

3.5 - 4.5; No. of People; 18; 30%

4.5 - 5.5; No. of People; 22; 37%

Above 5.5; No. of People; 8; 13%

According to Income Group No. of People

Here we easily see that the 55% people are businessman and 40% are from

private jobs. And in income group 37% people are from income group 4.5 -5.5

lakh and the 30% are 3.5-4.5 lakh. So conclusion that here the majority of

businessman and private job person are interested in saving account.


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5. Bank which people have saving account

No. of People, Barclays, 1

No. of People, Other, 13

No. of People, HDFC, 31

No. of People, Yes Bank, 2

No. of People, Standard Char-

tered, 13

No. of People

Here we find that the market potential of HDFC Bank is high because out of 60

people 31(51%) peoples have HDFC Saving Account. HDFC & Other are

equivalent. Where Standard chartered Bank has only 7.8% people.

6. Age Group Vs Features

42%

23%

8%

27%

Age Group 20-30 Vs Liking features

ATM NetworkService24/7 Internet BankingOthers


48 | P a g e

41%

24%

12%

24%

Age Group 30-40 vs Liking FeatureATM Network Service 24/7 Internet Banking Others

ATM Network43%

Service29%

Others29%





49 | P a g e

As far as the using features are concerned the people are more aggressive

towards the ATM Network then after they said about the Service and after the

service they looking for other. Other included new era service like Doorstep

Banking, Mobile Banking, and Online Banking. In survey I found that a person

usage ATM thrice and more times in a week. Its shows that how people

devoted about ATM Network and also for other

Services like Mobile banking, Doorstep Banking, Online Banking and etc.

7. Features which people like in using bank

Percentage

No. of People


50 | P a g e

The overall analysis said that feature which people like in using bank is ATM

Network and after that other services like Door Banking, Internet Banking,

Online Banking, Mobile Banking and etc. Every person wants to each thing at

his Door because nobody wants to expense time.

8. People preferred bank (If switches)

Here overall percentage of preferring bank (if people want to open a new

saving account) is HDFC, 39% and Standard Chartered is 25%. It show the

how people go for using new feature and better Service. In this also people

want to go for a brand name which Standard chartered bank has.


51 | P a g e

9. Age Group Vs Preferred Bank (If Switches)

Standard Char-tered38%

HDFC19%

Yes Bank15%

Bar-clays8%

Others19%

Age Group (20-30) Vs Preferred Bank

Standard Char-tered14%

HDFC36%Yes Bank

18%Bar-clays7%

Others25%

Age Group (40-50) Vs Pre-ferred Bank

Here I find that the age group of 20-30 preferred Brand Name like Standard

Chartered Bank which is 39%. Except the age group 40-50 all are prefer SCB.

The Second position occupied by HDFC Bank. The reason of why people prefer

Standard Chartered Bank and HDFC bank more. I am discussing in next chart.


15%

23%

23%8%

31%


Barclays HDFCStandard Chartered Yes BankOthers

Standard Chartered

27%

HDFC36%

Yes Bnak18%

Others18%


52 | P a g e

10. Banks Vs Reason for Preferring

SCB HDFC Yes Bank Barclays Others0

1

2

3

4

5

6

7

8

9

10


In this competitive world people do not want waste his time. So he/she is

more conscious about time and money saving. I found that in the above chart

people pay more attention on banking core services in the other hand they

also want everything at his/her home. They also want to utilise new banking

services like mobile alert, fund transfer through mobile, online banking, and

doorstep banking etc.


53 | P a g e

Conclusion

We all are well know that how much time is precious for everyone. Everyone

do not want waste his/her time single minute. In this competitive era world

are globalised. Due to globalisation every person want to be fastest. Standard

Chartered Bank also want to be no. 1 through the offer more and more

services.

I found that the potential of saving account is more than current account. As

we know that a saving account can be sole name or joint name. So, most

probably people have a saving account. People like saving account because its

service are beneficiary and due to competition more services offered by the

banks.

I found that in my survey people more eager about banking service whatever

bank charges for services. As i already said that people have not much time.

Show they utilise latest service which provided by the banks. In mean while

people also go for the brand name because thay want to show their standard.

Last but not least I found that age group 20-30 & 30-40years people more

conscious about ATM Network, Banking Services and Brand name.


54 | P a g e

InsuranceLife is a roller coaster ride and is full of twists and turns. We cannot take

anything for granted in life. Insurance policies are a safeguard against the

uncertainties of life.

Insurance is system by which the losses suffered by a few are spread over

many, exposed to similar risks. Insurance is a protection against financial loss

arising on the happening of an unexpected event. Insurance policy helps in not

only mitigating risks but also provides a financial cushion against adverse

financial burdens suffered.

Insurance policies cover the risk of life as well as other assets and valuables

such as home, automobiles, jewelry et al. On the basis of the risk they cover,

insurance policies can be classified into two categories:

6.1 Life Insurance Policies:-

Life is very fragile and death is a certainty. We cannot control the

uncertainties of life. But, we can cover the risks surrounding us. Life

insurance, simply put, is the cover for the risks that we run during our lives. It

protects us from the contingencies that could affect us. Life insurance is not

for the person who passes away, it for those who survive. It is the

responsibility of every bread earner to guard against the events that could

affect the family in the unfortunate circumstance of his / her demise. Thus,

having a life insurance policy is very vital. Before going for a life insurance

policy it is imperative that you know about various types of life insurance

policies. Major among them are:

Endowment Policy


55 | P a g e

Whole Life Policy

Term Life Policy

Money-back Policy

Joint Life Policy

Group Insurance Policy

Loan Cover Term Assurance Policy

Pension Plan or Annuities

Unit Linked Insurance Plan

6.2 General Insurance Policies:-

General Insurance provides much-needed protection against unforeseen

events such as accidents, illness, fire, burglary et al. Unlike Life Insurance,

General Insurance is not meant to offer returns but is a protection against

contingencies. Almost everything that has a financial value in life and has a

probability of getting lost, stolen or damaged can be covered through General

Insurance policy.

Property (both movable and immovable), vehicle, cash, household goods,

health, dishonesty and also one's liability towards others can be covered

under general insurance policy. Under certain Acts of Parliament, some types

of insurance like Motor Insurance and Public Liability Insurance have been

made compulsory. Major insurance policies that are covered under General

Insurance are:

Home Insurance

Health Insurance

Motor Insurance

Travel Insurance


http://www.iloveindia.com/finance/insurance/general-insurance/travel-insurance.html

http://www.iloveindia.com/finance/insurance/general-insurance/motor-insurance.html

http://www.iloveindia.com/finance/insurance/general-insurance/health-insurance.html

http://www.iloveindia.com/finance/insurance/general-insurance/home-insurance.html

56 | P a g e

Unit Linked Insurance Plan

Unit linked insurance plan (ULIP) is life insurance solution that provides for

the benefits of protection and flexibility in investment. The investment is

denoted as units and is represented by the value that it has attained called as

Net Asset Value (NAV). The policy value at any time varies according to the

value of the underlying assets at the time.

ULIP provides multiple benefits to the consumer. The benefits include:

Life protection

Investment and Savings

Flexibility

Adjustable Life Cover

Investment Options

Transparency

Options to take additional cover against

Death due to accident

Disability

Critical Illness

Surgeries

Liquidity

Tax planning


57 | P a g e

Features of Unit Linked Insurance Plan:-

Premiums paid can be single, regular or variable. The payment period

too can be regular or variable. The risk cover can be increased or

decreased.

The costs in ULIP are higher because there is a life insurance component

in it as well, in addition to the investment component.

Investments can be made in gilt funds, balanced funds, money market

funds, growth funds or bonds.

The policyholder can switch between schemes, for instance, balanced to

debt or gilt to equity, etc.

As in all insurance policies, the risk charge (mortality rate) varies with

age.

The maturity benefit is not typically a fixed amount and the maturity

period can be advanced or extended.

The maturity benefit is the net asset value of the units.

Insurance companies have the discretion to decide on their investment

portfolios.

They are simple, clear, and easy to understand.

Being transparent the policyholder gets the entire episode on the

performance of his fund.

Provides capital appreciation.

Investor gets an option to choose among debt, balanced and equity

funds.

Lead to an efficient utilization of capital.

ULIP products are exempted from tax and they provide life insurance.


58 | P a g e

ULIP in Standard Chartered Bank

Standard Chartered offers a wide range of Life Insurance Products from Bajaj

Allianz Life Insurance Company, one of India's leading Insurance companies.

The flexible Unit linked life insurance plans at Standard Chartered bank

provides the opportunity to participate in market-linked returns while

enjoying the valuable benefits of life insurance

1. Bajaj Allianz Life Insurance Co. Ltd.

Bajaj Allianz is a joint venture between Allianz AG one of the world's largest

insurance companies, and Bajaj Auto, one of the biggest 2 and 3 wheeler

manufacturers in the world. Bajaj Allianz is into both life insurance and

general insurance.

Allianz Group is one of the world's leading insurers and financial services

providers. Founded in 1890 in Berlin, Allianz is now present in over 70

countries with almost 174,000 employees.

Bajaj group is the largest manufacturer of two-wheelers and three-wheelers

in India and one of the largest in the world.

ULIP – New Unit Gain

Bajaj Allianz “New Unit Gain” offers the unique option of combining the

protection of life insurance with the attractive prospect of investing in

securities. The investor has the freedom to choose the funds he wishes to


59 | P a g e

invest his money in, providing him the opportunity to have a direct stake in

the performance of the financial markets. One can also benefit from tax

advantages while protecting his loved ones against unfortunate events.

Key highlight of Bajaj Allianz New Unit Gain:-

Your investment, apart from normal allocation, receives Loyalty Units

equivalent to 51% of First Year’s Annualized Premium over a period of

10 years.

Seven investment funds to choose from with unmatched flexibility to

manage your investments better.

You policy continues to participate in investment performance of the

fund(s). Even if you are not able to pay 3 full years premium

Maximum flexibility and Option to increase premium

Partial withdrawals any time after three years from the commencement

of policy provided three full years’ premiums are paid.

Three free switches every year.

Option to pay unlimited top up premiums anytime during the tenure of

your policy to further enhance your savings.

You have three simple terms to choose from – 15, 20 and 25 yrs.

A host of optional additional rider benefits to provide you additional

protection


60 | P a g e

Guaranteed Life Cover, with a flexibility to choose insurance cover

according to your changing needs.

Tax Save

Partial Withdrawals, Surrender Value, Death Benefit and Maturity

Benefit are eligible for tax benefits as per Section 10(10D) of the Income

Tax Act.

The charges paid for UL Critical Illness and UL Hospital Cash Benefit are

eligible for tax benefits as per Section 80(D) of the Income Tax Act.

How does the plan work?

Premiums paid by you, net of premium allocation charge, are invested in

fund(s) of your choice and units are allocated depending on the unit price of

the fund(s). The value of your policy is the total value of units that you hold in

the fund(s). The insurance cover charges, policy administration charges and

the additional rider benefit charges (if any) are deducted through monthly

cancellation of units. Fund Management Charge is priced in the unit value.

Important Details of the ‘Bajaj Allianz New UnitGain’ Plan

Parameter Details

Minimum Age at Entry 0 years, risk commences at age 7.

(18 years in case of all Additional Rider

Benefits


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Maximum Age at Entry 60 years (50 years in case of all Additional

Rider Benefits)

Minimum Maturity Age 18 years

Maximum Maturity Age 75 years

Additional Rider Benefit

Ceasing Age

65 years for all riders except UL WOP

Minimum Premium

(for Male lives)

Rs. 10,000 per yearly instalment,

Rs. 5,000 per half-yearly instalment,

Rs. 1,000 per monthly mode

Minimum Top Up Premium is Rs. 5,000

Minimum Premium

(for Female lives)

Rs. 7,500 per yearly instalment,

Rs. 3,750 per half-yearly instalment,

Rs. 750 per monthly mode

Minimum Top Up Premium is Rs. 5,000.

(Monthly mode for both male and female

lives is available through ECS and Salary

Saving Scheme only).

Minimum Sum Assured 0.5 * Policy Term * Annualized Premium

Maximum Sum Assured Multiplier * Annualized Premium

(Multiplier would depend on the age at entry

and

any riders chosen)


62 | P a g e

CONCLUSION ABOUT MARKET POTENTIAL OF ULIPS

1. Trust needs to be developed among the customers both as far as the ULIP as a product is concerned and also regarding private players (Standard Chartered) particularly in our study.

2. Some respondents despite of knowing about ULIP were hesitant to talk on it because they were not too confident about their knowledge. This very fact completely declines the concept of providing switches as a lucrative feature in ULIP (which is done by most of the companies). The reason is that very rarely people have the ability or time to use these features.

3. The important facts which we could conclude from our data regarding the buying behavior of individuals are that people give maximum importance to the tax benefit that they receive after investing in the unit linked insurance plan .Further the next most attractive benefit that people look forward to most as per our sample is that of income growth. In fact most of the unmarried chunk of our population who has no liabilities like child education or marriage goes in for a ULIP product just to multiply the money in a couple of years. Other benefits are important as well but these two take away most of the attention.

4. Regarding the acceptance of ULIP as a product over other investments it is analyzed that though a lot of our sample population was aware about it and had invested in it but still a lot of them (including Females) wanted to invest in it but were confused regarding other options like mutual funds. So a lack of public awareness was encountered.

5. Another important finding was that time horizon was one of the factors of concern while investing in ULIP and as per the analysis of the questionnaire we found that a large proportion of our sample was convenient with the time period of 4-7 years and then others were in


63 | P a g e

favor of a period not beyond 3 years. This implies that very less number of people were comfortable with long time horizons.

6. Another very interesting finding from our data is that when we talk about risk as an investment criterion then the female population which already has or is interested in investing would favor either no risk at all or low risk and low gain. Whereas the customers’ businessmen by occupation and specifically from age group 21- 30 would favor either moderate risk and moderate gain or rather go for a high risk and high gain strategy. This result came completely in line with our expectations.

7. Considering the market share of the leading players it was found that LIC rules when it comes to an age group of 50 plus due to the credibility and trust it has gained in all past years. Where the other age groups prefer to explore the leading private players where in our sample Standard Chartered (Bajaj Allianz) and ICICI prudential make a clean sweep. Other banks like HDFC were found with a limited proportion only according to our findings.

8. Our analysis shows that though the product has been able to cater to a

number of benefits but still a lot of brand awareness is lacking and LIC is

posing the biggest threat followed by SBI life to the private players.

Mutual funds

Mutual Fund is an instrument of investing money. Nowadays, bank rates have

fallen down and are generally below the inflation rate. Therefore, keeping


64 | P a g e

large amounts of money in bank is not a wise option, as in real terms the value

of money decreases over a period of time.

One of the options is to invest the money in stock market. But a common

investor is not informed and competent enough to understand the intricacies

of stock market. This is where mutual funds come to the rescue.

A mutual fund is a group of investors operating through a fund manager to

purchase a diverse portfolio of stocks or bonds. Mutual funds are highly cost

efficient and very easy to invest in. By pooling money together in a mutual

fund, investors can purchase stocks or bonds with much lower trading costs

than if they tried to do it on their own. Also, one doesn't have to figure out

which stocks or bonds to buy. But the biggest advantage of mutual funds is

diversification.

Diversification means spreading out money across many different types of

investments. When one investment is down another might be up.

Diversification of investment holdings reduces the risk tremendously.

The origin of the Indian mutual funds industry dates back to 1963 when the

Unit Trust of India (UTI) came into existence at the initiative of the

Government of India and the Reserve Bank of India. Since then the mutual

funds sector remained the sole fiefdom of UTI till 1987 when a slew of non-

UTI, public sector mutual funds were set up by nationalized banks and life

insurance companies.

The year 1993 saw sweeping changes being introduced in the mutual fund

industry with private sector fund houses making their debut and the laying


65 | P a g e

down of comprehensive mutual fund regulations. Over the years, the Indian

mutual funds industry has witnessed an exponential growth riding piggyback

on a booming economy and the arrival of a horde of international fund houses.


66 | P a g e

First Phase – 1964-87 Growth of Unit Trust of India

Unit Trust of India (UTI) was established on 1963 by an Act of Parliament. It

was set up by the Reserve Bank of India and functioned under the Regulatory

and administrative control of the Reserve Bank of India. In 1978 UTI was de-

linked from the RBI and the Industrial Development Bank of India (IDBI) took

over the regulatory and administrative control in place of RBI. The first

scheme launched by UTI was Unit Scheme 1964. At the end of 1988 UTI had

Rs.6, 700 crores of assets under management.

Second Phase – 1987-1993 (Entry of Public Sector Funds)

1987 marked the entry of non- UTI, public sector mutual funds set up by

public sector banks and Life Insurance Corporation of India (LIC) and General

Insurance Corporation of India (GIC). SBI Mutual Fund was the first non- UTI

Mutual Fund established in June 1987 followed by Canbank Mutual Fund (Dec

87), Punjab National Bank Mutual Fund (Aug 89), Indian Bank Mutual Fund

(Nov 89), Bank of India (Jun 90), Bank of Baroda Mutual Fund (Oct 92). LIC

established its mutual fund in June 1989 while GIC had set up its mutual fund

in December 1990. At the end of 1993, the mutual fund industry had assets

under management of Rs.47,004 crores.

Third Phase – 1993-2003 (Entry of Private Sector Funds)


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With the entry of private sector funds in 1993, a new era started in the Indian

mutual fund industry, giving the Indian investors a wider choice of fund

families. Also, 1993

was the year in which the first Mutual Fund Regulations came into being,

under which all mutual funds, except UTI were to be registered and governed.

The erstwhile Kothari Pioneer (now merged with Franklin Templeton) was

the first private sector

Mutual fund registered in July 1993. The 1993 SEBI (Mutual Fund)

Regulations were substituted by a more comprehensive and revised Mutual

Fund Regulations in 1996. The industry now functions under the SEBI (Mutual

Fund) Regulations 1996.

The number of mutual fund houses went on increasing, with many foreign

mutual funds setting up funds in India and also the industry has witnessed

several mergers and acquisitions. As at the end of January 2003, there were

33 mutual funds with total assets of Rs. 1,21,805 crores. The Unit Trust of

India with Rs.44,541 crores of assets under management was way ahead of

other mutual funds.

Fourth Phase – since February 2003

In February 2003, following the repeal of the Unit Trust of India Act 1963 UTI

was bifurcated into two separate entities. One is the Specified Undertaking of

the Unit Trust of India with assets under management of Rs.29,835 crores as

at the end of January 2003, representing broadly, the assets of US 64 scheme,


68 | P a g e

assured return and certain other schemes. The Specified Undertaking of Unit

Trust of India, functioning under an administrator and under the rules framed

by Government of India and does not come under the purview of the Mutual

Fund Regulations.

The second is the UTI Mutual Fund Ltd, sponsored by SBI, PNB, BOB and LIC.

It is registered with SEBI and functions under the Mutual Fund Regulations.

With the bifurcation of the erstwhile UTI which had in March 2000 more than

Rs.76,000 crores of assets under management and with the setting up of a UTI

Mutual Fund, conforming to the SEBI Mutual Fund Regulations, and with

recent mergers taking place among different private sector funds, the mutual

fund industry has entered its current phase of consolidation and growth. As at

the end of September, 2004, there were 29 funds, which manage assets of

Rs.153108 crores under 421 schemes.


69 | P a g e

The graph indicates the growth of assets over the years.

9.1 Professional Management

Mutual Funds employ the services of skilled professionals who have years of

experience to back them up. They use intensive research techniques to

analyze each investment option for the potential of returns along with their

risk levels to come up with the figures for performance that determine the

suitability of any potential investment.

9.2 Potential of Returns

Returns in the mutual funds are generally better than any other option in any

other avenue over a reasonable period of time. People can pick their

investment horizon and stay put in the chosen fund for the duration. Equity

funds can outperform most other investments over long periods by placing


70 | P a g e

long-term calls on fundamentally good stocks. The debt funds too will

outperform other options such as banks. Though they are affected by the

interest rate risk in general, the returns generated are more as they pick

securities with different duration that have different yields and so are able to

increase the overall returns from the portfolio.

9.3 Liquidity

Fixed deposits with companies or in banks are usually not withdrawn

premature because there is a penal clause attached to it. The investors can

withdraw or redeem money at the Net Asset Value related prices in the open-

end schemes. In closed-end schemes, the units can be transacted at the

prevailing market price on a stock exchange. Mutual funds also provide the

facility of direct repurchase at NAV related prices. The market prices of these

schemes are dependent on the NAVs of funds and may trade at more than NAV

(known as Premium) or less than NAV (known as Discount) depending on the

expected future trend of NAV, which in turn is linked to general market

conditions. Bullish market may result in schemes trading at Premium while in

bearish markets the funds usually trade at Discount. This means that the

money can be withdrawn anytime, without much reduction in yield. Some

mutual funds however, charge exit loads for withdrawal within a specified

period.

9.4 Effective Regulation

Unlike the company fixed deposits, where there is little control with the

investment being considered as unsecured debt from the legal point of view,

the Mutual Fund industry is very well regulated. All investments have to be


71 | P a g e

accounted for, decisions judiciously taken. SEBI acts as a true watchdog in this

case and can impose penalties on the AMCs at fault. The regulations, designed

to protect the investors’ interests are also implemented effectively.

9.5 Transparency

Being under a regulatory framework, mutual funds have to disclose their

holdings, investment pattern and all the information that can be considered as

material, before all investors. This means that the investment strategy,

outlooks of the market and scheme related details are disclosed with

reasonable frequency to ensure that transparency exists in the system. This is

unlike any other investment option in India where the investor knows nothing

as nothing is disclosed.

9.6 Flexible and Affordable

Mutual Funds offer a relatively less expensive way to invest when compared

to other avenues such as capital market operations. The fee in terms of

brokerages, custodial fees and other management fees are substantially lower

than other options and are directly linked to the performance of the scheme.

Investment in mutual funds also offers a lot of flexibility with features such as

regular investment plans, regular withdrawal plans and dividend

reinvestment plans enabling systematic investment or withdrawal of funds.

Even the investors, who could otherwise not enter stock markets with low

investible funds, can benefit from a portfolio comprising of high-priced stocks

because they are purchased from pooled funds.


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9.6 Charges

The Asset Management Companies (AMCs) managing the Mutual Funds levy a

load as a percentage of NAV at the time of entry into the Schemes or at the

time of exiting from the Schemes.

Entry Load - It is the load charged by the fund when an investor invests

into the fund. It increases the price of the units to more than the NAV

and is expressed as a percentage of NAV.

Exit Load - It is the load charged by the fund when an investor redeems

the units from the fund. It reduces the price of the units to less than the

NAV and is expressed as a percentage of NAV.

Cost of Churning/Turnover cost - It refers to the costs associated with

the churning (or changes made to the holdings) of the portfolio.

Portfolio changes have associated costs of brokerage, custody fees,

transaction fees and registration fees, which lower the returns. The

quantum depends on the management style of the fund manager.

Expense Ratio - The Expenses of a mutual fund include management

fees and all the fees associated with the fund's daily operations. Expense

Ratio refers to the annual percentage of fund's assets that is paid out in

expenses.

9.7 Tax

Capital Gains Tax- The profit realizations on sale of securities and

certain other capital assets (including units of mutual funds) are called

capital gains. The gains can be classified into long-term or short-term


73 | P a g e

depending on the period of holding of the asset and are charged to tax at

different rates. Gains on mutual fund units held for a period of 12

months or more are long-term gains. These gains are taxable.

Dividend Distribution Tax – The Mutual Fund schemes distributing

dividends on their units to the investors attract a distribution tax as per

tax laws.

Securities Transaction Tax – AMCs managing the portfolio have to pay

STT on transaction (buying/selling) of different securities in the stock

market. Presently the tax rate is 0.025%.

9.8 Pointers to Mutual Fund Performance

Mutual Fund industry today, with about 34 players and more than five

hundred schemes, is one of the most preferred investment avenues in India.

However, with a plethora of schemes to choose from, the retail investor faces

problems in selecting funds. Factors such as investment strategy and

management style are qualitative, but the funds record is an important

indicator too. Though past performance alone cannot be indicative of future

performance, it is the only quantitative way to judge how good a fund is at

present. Therefore, there is a need to correctly assess the past performance of

different mutual funds. Quite simply then a fund generating more returns than

the other is considered better than the other. But this is just half the story.

Return alone should not be considered as the basis of measurement of the

performance of a mutual fund scheme, it should also include the risk taken by

the fund manager because different funds will have different levels of risk

attached to them.


74 | P a g e

Risk associated with a fund can be defined as fluctuations in the returns

generated by it. The higher the fluctuations in the returns of a fund during a

given period, higher will be the risk associated with it. These fluctuations in

the returns generated by a fund are resultant of two guiding forces. First,

general market fluctuations affecting all the securities present in the market

are called market risk or systematic risk and second, fluctuations due to

specific securities present in the portfolio of the fund, called unsystematic

risk. The Total Risk of a given fund is sum of these two and is measured in

terms of standard deviation of returns of the fund.

Systematic risk is measured in terms of Beta, which represents fluctuations in

the NAV of the fund vis-à-vis market. The more responsive the NAV of a

mutual fund is to the changes in the market; higher will be its beta. Beta is

calculated by relating the returns on a mutual fund with the returns in the

market. While unsystematic risk can be diversified through investments in a

number of instruments, systematic risk cannot. By using the risk return

relationship, we try to assess the competitive strength of the mutual funds vis-

à-vis one another in a better way. It should be appreciated that there is a level

of risk that a fund has taken to generate this return. So what is really relevant

is not just performance or returns. What matters therefore are Risk Adjusted

Returns (RAR).

The only caveat whilst using any risk-adjusted performance is the fact that

their clairvoyance is decided by the past. Each of these measures uses past

performance data and to that extent are not accurate indicators of the future.


75 | P a g e

9.9 Benefits of Mutual Funds

Investor is benefited by investing in Mutual Funds because

Diversification: - Diversified portfolio is balanced in varying economic

conditions. When there is rise in interest rate, some securities decrease

and some increase in value. Gradually the value of overall portfolio

increases over time even if some securities lose value

Professional Management - Top managers are paid by Mutual funds to

manage their investments. They decide what securities the fund will buy

and sell

Liquidity - Money can be taken out of mutual fund anytime easily

Convenient - Mutual fund shares can be bought by email, phone or over

internet.

Regulatory Oversight - Investors are protected from fraud as mutual

funds are subject to government regulations

Low Cost - Expenses of Mutual Fund is 1.5% of the investment.

Tax Benefits - Investors gets tax benefits over the money invested in

Mutual Fund

Transparent and Flexible

Choice of Schemes - Investor can choose between many schemes

Well regulated

9.10 Disadvantages of Mutual Funds

No Guarantee - When the entire stock market goes down, the Mutual

Fund shares will also go down even if the portfolio is balanced though

the risk is low


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Administrative fees or sales commissions is charged by all the funds to

compensate brokers and financial planners

Taxes have to be paid on the income the investors make even if you

reinvest the profit

Management Risk is always there as the funds manager takes the

decision for you regarding funds portfolio

9.11 Types of Mutual Funds

Open-end fund

Exchange-traded funds

Equity funds

o Capitalization

o Growth vs. value

o Index funds versus active management

Bond funds

Money market funds

Funds of funds

Hedge funds

9.12 Performance Comparison of Mutual Funds

Equity Linked Savings Scheme - A special product offered by mutual

funds. These schemes invest in equity i.e shares and generally have a

lock-in period of three years.

Balanced Funds – These funds invest part of their corpus into Debt

Instruments which give a fixed rate of return and the remaining part of

the corpus into Equity giving a high rate of return. Thus, overall the


http://en.wikipedia.org/wiki/Mutual_fund#Index_funds_versus_active_management

http://en.wikipedia.org/wiki/Mutual_fund#Growth_vs._value

http://en.wikipedia.org/wiki/Mutual_fund#Capitalization

http://en.wikipedia.org/wiki/Mutual_fund#Equity_funds

http://en.wikipedia.org/wiki/Mutual_fund#Exchange-traded_funds

http://en.wikipedia.org/wiki/Mutual_fund#Open-end_fund

http://en.wikipedia.org/wiki/Mutual_fund#Hedge_funds

http://en.wikipedia.org/wiki/Mutual_fund#Funds_of_funds

http://en.wikipedia.org/wiki/Mutual_fund#Money_market_funds

http://en.wikipedia.org/wiki/Mutual_fund#Bond_funds

77 | P a g e

balanced funds give a moderate rate of return with lower risk as

compared to the pure equity funds.

9.13 Criticism of managed mutual funds:-

Historically, only a small percentage of actively managed mutual funds,

over long periods of time, have returned as much, or more than

comparable index mutual funds.

Critics point out that high sales commission can sometimes represent a

conflict of interest, as high commissions benefit the sales people but

hurt the investors. Although in reality, "A shares", which appear to have

the highest up front load, (around 5%) are the "cheapest" for the

investor, if the investor is planning on 1) keeping the fund for more than

5 years, 2) investing more than 100,000 in one fund family, which likely

will qualify them for "breakpoints", which is a form of discount, or 3)

staying with that "fund family" for more than 5 years, but switching

"funds" within the same fund company

Mutual fund managers and companies need to disclose by law, if they

have a conflict of interest due to the way they are paid. In particular

fund managers may be encouraged to take more risks with investors’

money than they ought to: Fund flows (and therefore compensation)

towards successful, market beating funds are much larger than outflows

from funds that lose to the market. Fund managers may therefore have

an incentive to purchase high risk investments in the hopes of

increasing their odds of beating the market and receiving the high


78 | P a g e

inflows, with relatively less fear of the consequences of losing to the

market.

Difficulty to effectively manage large pool of money

some funds illegally are gulity of market timing and that some fund

managers, also illegal, accept extravagant gifts in exchange for trading

stocks through certain investment banks, which presumably charge the

fund more for transactions than would non-gifting investment bank.

This practice, although done, is completely illegal.

ULIP Vs. Mutual Funds

Unit Linked Insurance Policies (ULIPs) as an investment avenue are

closest to mutual funds in terms of their structure and functioning. As is

the case with mutual funds, investors in ULIPs are allotted units by the

insurance company and a net asset value (NAV) is declared for the same

on a daily basis.

Similarly ULIP investors have the option of investing across various

schemes similar to the ones found in the mutual funds domain, i.e.

diversified equity funds, balanced funds and debt funds to name a few.

Generally speaking, ULIPs can be termed as mutual fund schemes with

an insurance component.

However it should not be construed that barring the insurance element

there is nothing differentiating mutual funds from ULIPs.


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The various factors where the ULIPs and Mutual Funds differ are as follows:

ULIPs Mutual Funds

Investment

amounts

Determined by

the investor and

can be modified

as well

Minimum investment amounts are

determined by the fund house

Expenses No upper limits,

expenses

determined by

the insurance

company

Upper limits for expenses chargeable to

investors have been set by the regulator

Portfolio

disclosure

Not mandatory Quarterly disclosures are mandatory

Modifying

asset

allocation

Generally

permitted for

free or at a

nominal cost

Entry/exit loads have to be borne by the

investor

Tax benefits Section 80C

benefits are

available on all

ULIP

investments

Section 80C benefits are available only on

investments in tax-saving funds


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With these comparable there are certain factors where in these two differ.

Mutual funds are essentially short to medium term products. The liquidity

that these products offer is valuable for investors. ULIPs, in contrast, are

positioned as long-term products and going ahead, there will be separate

playing fields for ULIPS and MFs, with the product differentiation between

them becoming more pronounced. ULIPs do not seek to replace mutual funds,

they offer protection against the risk of dying too early, and also help people

save for retirement. Insurance has to be an integral part of one's wealth

management portfolio. Further, exposure of Indian households to capital

markets is limited.

2. Taxation

India has a well-developed tax structure with a three-tier federal structure,

comprising the Union Government, the State Governments and the

Urban/Rural Local Bodies. The power to levy taxes and duties is distributed

among the three tiers of Governments, in accordance with the provisions of

the Indian Constitution. The main taxes/duties that the Union Government is

empowered to levy are Income Tax (except tax on agricultural income, which

the State Governments can levy), Customs duties, Central Excise and Sales Tax

and Service Tax. The principal taxes levied by the State Governments are Sales

Tax (tax on intra-State sale of goods), Stamp Duty (duty on transfer of

property), State Excise (duty on manufacture of alcohol), Land Revenue (levy

on land used for agricultural/non-agricultural purposes), Duty on

Entertainment and Tax on Professions & Callings. The Local Bodies are


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empowered to levy tax on properties (buildings, etc.), Octroi (tax on entry of

goods for use/consumption within areas of the Local Bodies), Tax on Markets

and Tax/User Charges for utilities like water supply, drainage, etc.

Since 1991 tax system in India has under gone a radical change, in line with

liberal economic policy and WTO commitments of the country. Some of the

changes are:

Reduction in customs and excise duties

Lowering corporate Tax

Widening of the tax base and toning up the tax administration

The fifth consecutive budget presented by the FM, Mr. P. Chidambaram ,was

also a dream one for the salaried class……..With the higher tax limits on the

income tax slabs ,the increased basic exemption limit for senior citizens

z,women and individuals in general, etc. the budget gives much relief to the

middle class as it aims at reducing their overall tax liability by a good

measure. Here we can take a look at the direct tax proposals and the impact

they will have on our finances.

Income tax slabs

The exemption limit for personal income tax has been enhanced to Rs. 1.80

lakh from the present Rs. 1.45 lakh for women (below the age of 65 years),Rs.

2.25 lakh from the present Rs.1.95 lakh for senior citizens and Rs.1.5 lakh


82 | P a g e

from the present Rs.1.1 lakh for others. The revised tax slabs are as tabulated

on the next page.

Proposed tax slab for FY 2008-09(Assessment Year 2009-10)

For Men below 65

years of age

For Women below 65

Years of age

For Senior Citizens

Income

level

Tax

rate

Income

level

Tax

rate

Income

level

Tax rate

Up to

Rs.1,50,00

0

Nil Up to

Rs.1,80,000

Nil Up to

Rs.2,25,000

Nil

Rs.

1,50,001-

Rs.

3,00,000

10% Rs.1,80,001

-

Rs.3,00,000

10% Rs.2,25,001

-

Rs.3,00,000

10%

Rs.

3,00,001-

Rs.

5,00,000

20% Rs.3,00,001

-

Rs.5,00,000

20% Rs.3,00,001

-

Rs.5,00,000

20%

Above

Rs.5,00,00

0

30% Above

Rs.5,00,000

30% Above

Rs.5,00,000

30%


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The revision of the income slabs and the applicable rates of tax will result in

substantial savings for individuals across all income ranges. The following

table gives a comparative analysis of the post budget savings that will accrue:

Comparative analysis of post-budget Tax Savings

Male Tax payers

(below the age of 65 years)

Female Tax payers

(below the age of 65 years)

Income

(Rs.)

Existing

tax

liability

(Rs.)

Tax

liability as

per

Budget

2008(Rs.)

Savings

(Rs.)

Existing

tax

liability

(Rs.)

Tax

liability as

per

Budget

2008(Rs.)

Saving

s

(Rs.)

1 lakh Nil Nil Nil Nil Nil Nil

2 lakh 14,420 5,150 9,270 10,815 2,060 8,755

3 lakh 40,170 15,450 24,720 36,565 12,360 24,20

5

4 lakh 71,070 36,050 35,020 67,465 32,960 34,50

5

5 lakh 1,01,970 56,650 45,320 98,365 53,560 44,80

5

7 lakh 1,63,770 1,18,450 45,320 1,60,165 1,05,060 55,10

5

10 lakh 2,56,470 2,11,150 45,320 2,52,865 1,97,760 55,10

5

15 lakh 4,52,067 4,02,215 49,852 4,48,102 3,87,486 60,61


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6

20 lakh 6,22,017 5,72,165 49,852 6,18,052 5,57,436 60,61

6

Senior Citizens(65 Years & above)

Income (Rs.) Existing tax

liability (Rs.)

Tax liability as

per budget 2008

(Rs.)

Savings (Rs.)

1 lakh Nil Nil Nil

2 lakh 1,030 Nil Nil

3 lakh 26,780 7,725 19,055

4 lakh 57,680 28,325 29,355

5 lakh 88,580 48,925 39,655

7 lakh 1,50,380 1,10,725 39,655

10 lakh 2,43,080 2,03,425 39,655

15 lakh 4,37,338 3,93,718 43,620

20 lakh 6,07,288 5,63,668 43,620

After a glimpse at the above tables we can conclude that there is immense

saving potential for individual tax payers across all categories. The reduction

in tax liabilities aims at making lives easier for the middle class. It also tries to

enhance their purchasing power and, in the process gives impetus to demand

and growth of the industry


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SWOT Analysis OF Standard Chartered Bank

STRENGTHS WEAKNESSES

Strong Brand Image

Dedicated sales team

Value added services.

Rigid Eligibility Criteria

Weak Customer

Relations Management

Centralized Structure

High Average Quarterly

Balance

Limited number of ATM’s

and Branches. Poor

network.

OPPORTUNITIES THREATS

Large Untapped Market.

Distinguishable product (like

Parivar Account).

Presence of very strong

competitors.

Aggressive marketing by

competitors.

Various investment Schemes

with high returns.


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Conclusion

Competitor’s Analysis

1. Almost all the Banks offer similar features and facilities with their

Savings accounts, therefore for existing customers of Savings Account of

any Bank to shift to another Bank; this is very rarely the criteria or

reason.

2. The level of service in terms of delivering whatever is promised, fast

response in case of problems, is the most important benefit that the

customers seek, from the Bank they have a Savings Account with.

3. Network reach and visibility of a Bank is a very important criterion for

the customer while opening a Savings account. We can also conclude

from our analysis that network reach in terms of Branches and ATMs is

directly proportional to the market share in case of Private Players.

4. In case of a new customer, if a bank approaches it first for opening a

Savings account with them, then there is a good chance for the bank of

getting many future businesses from the deal.


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Aggressive Marketing is the key to increasing the market share in this area,

since the market has a lot of potential both in terms of untapped market

Recommendations for Increasing Market Share of

Standard Chartered Bank

1. The bank should try to improve the ATM Services, as it is one of the

major reasons for dissatisfaction among the customers as majority of

those who were dissatisfied where on account of non-availability of cash

in ATM,s and limited number of ATM’s.

2. The bank should also target the females for its saving Account especially

parivar accounts.

3. The bank should increase the number of ATM’s in the country as people

feel that the bank has very few ATM’s in the country.

4. The bank needs to make people aware about these products and the

basic benefits they can derive out of it. And also the differential features

of its savings account as compared to other banks.70% of the people did

not even know about the concept, benefits and features of its saving

accounts.


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5. Also it was found in our analysis that the customers don’t really mind

keeping a high balance in their savings account and the bank should tap

this fact by keeping a higher AQB and reduce the charges of different

services which customers have a problem paying for. Only around 10%

of the customers considered it to be an important issue for deciding on

their banking preferences.

6. It was also found in our analysis that ATM is the most preferred

method of banking of most customers and the preference for credit

cards is low thus the bank should use this fact by giving free ATM cards

with its savings account instead of the not used credit card which

customers consider to be unwanted. More than 50% of the customers

banked through the ATM’s.

7. The bank should target individuals in the age group of 25+ for whom

maintenance of the AQB is not a problem and further increase the

number of free inter bank ATM transactions from 4 to 6 as the

customer rate this highly important a factor while opening a savings

account.

8. The customer satisfaction levels are the lowest in Standard

chartered(only around 25%of its existing customers were satisfied)

among all banks so the bank needs to work on its general image as such

by promoting itself as a bank which puts “customers first” and not as

the highest profit making bank.


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9. When we talk about the banking preferences of businessmen then they

are looking for nation wide service and wide network of ATMs because

of the nature of there work thus the bank should work on this fact by

making its presence felt on a national level.

10. One very shocking result which has come out of our analysis is

that as the income of the customer rises his preference for our bank

falls, which is contrary to the bank’s objective thus the bank needs to

check on this result and work on factors responsible for the same which

could range from lack of concern shown by the bank to the fact that

people do not like the breech of privacy which private banks do my

making calls for other products of the bank on repetitive basis. Thus the

bank needs to respect this right of the customer and not make

unsolicited calls to them and also remember that they can no longer

survive by taking customers for a ride.

11. Though the bank offers free doorstep banking once a day this

fact is also not known to many customers or they still do not trust this

service what ever the reason the bank can popularize this service to

gain an edge over nationalized banks.


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12. One complain which really came up during the course of our

market research was that most of the customers felt that the sales

agents who approach them on behalf of the bank our not qualified

enough to perform the task for this esteemed bank and thus we

recommend that college students or fresh graduates from reputed

colleges can be hired on part time basis for this job.

13. Our market research shows that women are a big target for the

bank as not only is there role in influencing investment decision in the

family increasing also there own potential has increased as a lot of them

are working these days. Also it has been seen that business men prefer

to open the savings account is his spouse’s name with the business

account in his name. The bank needs to capitalize on this by offering

schemes which are women friendly and also directing the

promotion towards them.

14. Quality of service has been rated highly important by all

demofigureic factors as a reason for banking with a particular bank,

Standard Chartered needs to improve the services provided to its

existing customers before attracting more in the future and use word of

mouth as a promotional tool to increase the sales potential of its savings

account.


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Recommendations for ULIPS

1. Building trust by providing the customers with adequate knowledge

about the company and then the product.

2. Enhancing the level of awareness in terms of the company, their

Partners and the product and special emphasis among the female chunk

of the population.

3. Using the Brand equity of Standard Chartered to promote Bajaj Allianz

(Business assurance model) rather than doing it other way since brands

like Bajaj are not enjoying the same image today what they did years

back.

4. The private players should try to establish Brand awareness and

credibility especially among the senior customers so as to divert their

interest from the clean sweep made by LIC and UTI.

5. The companies should target more of female consumers as they have

money to invest but are completely unaware about the options available

to them and ULIP should be made to look more attractive to them.

6. Adequate advertisement via appropriate media should be done by the

various companies as is done in the case of mutual Funds.

7. Customers are not aware about the ULIP being offered by their own

banks. Specifically it was seen in case of Standard Chartered Bank as

those with BAJAJ ALLIANZ were not able to relate it to the bank. So,

proper counters should be there to facilitate customer awareness.


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8. Certain discount charges should be made available because of the

severe competition within the private players as well as the biggest

threat posed by LIC and SBI.

9. Various branches of Standard Chartered should try to tap their own

customers first depending on the various profiles they have, rather than

the other set of customers which they primarily focus upon.

10. ULIP is a highly untapped market and here the right strategies

and hitting the bulls eye by propagating the most sought after benefit

among the customers will attract most of the customers.

11. Most of the customers as per our sample are inclined towards

ICICI Pru because of the strong policy base and easy accessibility. So

other competitors really need to make a new brand awareness policy.

But on the other hand some of them are really unhappy with the service

provisions done by ICICI Pru after acquiring the customers. In their

view it deteriorates. So it should be taken care of.

One of the most important steps to be taken by standard Chartered bank to be

successful with ULIPs (Bajaj Allainz) is to promote these by using the brand

awareness and brand equity of Standard Chartered and not Bajaj Allainz for

which it is acting as a distributor.


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Limitations

Some of the limitations of the project are listed as below:

1. The time period of just 2 months was the major limitation.

2. Due to the financial and time constraints a cluster analysis of the

population so as to get better results was not feasible.

3. It was difficult to break the ice with the common people initially. It was

a daunting task to convince them to fill in the personal details of the

questionnaire where they have to mention the monthly income,

occupation etc.

4. To convince the people for a proper interviewing process is also

difficult.

5. The competitor analysis in the manual could only be compiled for a

rough idea to the nature of the product. The product features and NAVs

keep on changing on a daily basis.

6. Compilation of data on competitor analysis was difficult due to non-

availability of correct information.

7. The figures have been taken as approximations.


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ReferencesBooks:

1. Churchill & Brown; Basic Marketing Research ;Thomas Publications,5th

edition

2. Paul Hague, Nick Hague and Carol-Ann Morgan; Market Research in

Practice; Kogan Page limited,1st South Asian edition 2004.

3. Harper W.Boyd, Jr. Ralph Westfall, Stanley F. G Stasch; Marketing

Research; All India Traveller Book Seller, 7th edition.

4. William O. Bearden, Richard G. Netemeyer, Mary F. Mobley; Handbook

of Marketing Skills; SAGE Publications.

5. “Malhotra Naresh , Marketing Research”, Prentice Hall of India.

6. “Kotler Philip,Marketing Management”

7. “Business Research Methods”(2004), Tata McGraw Hill Edition

8. Business Statistics,Levin,Krehbiel,Berenson

Websites:

www.standardchartered.in

www.hoovers.com

http://www.thehindubusinessline.com/2005/07/04/stories/

2005070401261200.htm

www.wikipedia.org

www.mouthshut.com

www.financeindiamart.com

www.howstuffworks.com


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www.standardchartered.com

www.google.com

www.yesbank.com

www.hdfcbank.com

www.barclays.com

Personnel:

1 Mr. Ashish Agarwal

2 Anna Lungany

3 Shweta Mehata


34586705-summer-training-report-on-standard-chartered-bank

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