A COMPARATIVE STUDY WITH REFERENCE TO RELATED BANK LOANS IN CHENNAI
PROJECT REPORT (A Report su!"tte# "$ P%rt"%& Fu&'"&&!e$t o' te Re)u"re!e$ts 'or te #e*ree o' M%ster o' Bus"$ess A#!"$"str%t"o$ "$ Po$#"+err, U$"-ers"t,.
Su!"tte# , Ms/ 0000000000000000000000 E$ro&!e$t No1 00000000000000000 MBA FINANCE
DIRECTORATE OF DISTANCE EDUCATION PONDICHERRY UNIVERSITY PONDICHERRY 2 345 467
(JUNE.
1
CERTIFICATE OF THE 8UIDE
This is to certify that the project work titled 9A COMPARATIVE STUDY
WITH REFERENCE TO RELATED BANK LOANS IN CHENNAI : is a bonafide work of
Ms/
C/ ESSTHER RANI E$ro&!e$t $o1 4;4<=>4;?3
Carried out t in partial fulfillment for the award of degree of
MBA F"$%$+e of
Po$#"+err, U$"-ers"t, under my guidance. This project work is srcinal and not
submitted earlier for the award of any Degree/ Diploma or associateship of any other University / nstitution.
S"*$%ture o' te 8u"#e DR/000000000000000000
P&%+e1 Ce$$%" D%te1
!
DECALARATION
@ Ms/ C/ ESSTHER RANI hereby declare that the project work titled 9A
COMPARATIVE STUDY WITH REFERENCE TO RELATED BANK LOANS IN CHENNAI:/ is the srcinal work done by me and submitted to the Po$#"+err, U$"-ers"t, in partial fulfillment of the re"uirements for the award of M%ster o' Bus"$ess A#!"$"str%t"o$ "$ F"$%$+e is a record of the srcinal work
done by me under the supervision of DR/N/KALYANARAMAN/
E$ro&&!e$t No1 000000000000
S"*$%ture o' te Stu#e$t
D%te1 Ms/0000000000000000
#
ACKNOWLED8EMENTS
adore and honor the $oly Trinity for strengthening me% being with me to guide and help me complete this research work successfully.
am greatly indebt ed to my supervisor and guide DR/N/KALYANARAMAN% &aculty% 'U(C Twinning 'rogram for his invaluable guidance% support and encouragement throughout the tenure of this work. greatly appreciate his fle)ibility towards my independent approach of this project. thank him once again for his invaluable suggestions.
would also like to e)press my sincere thanks to my 'rogram coordinator Pro'/ S/ %-"er M%"!%"r%@ MCo!@ M/E#@ M/P"&/@ MBA/@ PULC T"$$"$* Pro*r%!for his
invaluable support for the completion of the program.
would also like to e)press my profound gratitude to Dr/ Aro",%s%!" Director PULC T"$$"$* Pro*r%! %$# Re-/ Fr/ A&ert Mutu!%&%"@ S/J/@ Pr"$+"p%&@ Lo,o&% Co&&e*e% for providing me with an opportunity to carry out this study successfully.
*y deepest and loving gratitude goes to my beloved parents for their moral and prayerful support.
*y sincere thanks are due to all those who shared their invaluable time to provide the re"uired information for this research.
profusely thank my friends who generously shared their valuable time for me to complete the research success
+
ABSTRACT A COMPARATIVE STUDY WITH REFERENCE TO RELATED BANK LOANS IN CHENNAI:/
This study aims at To identified best contribution of loan in bank Compared with other banks rate of interest n this study for loan enragements% lending loan and interest rate calculation. $ence the study was undertaken at this point of clear comparison on interest rate with other banks.
,
Table of Contents S L /N O 1.
LIST OF CONTENTS
PA8E NO -!
!.
LIST OF DIA8RAMS AND CHARTS
-#
#.
CHAPTER 2 6 INTRODUCTION
+
LIST OF TABLES
1
6/6 INTRODUCTION OF TOPIC
1
6/; OBJECTIVES OF STUDY
6/= SCOPE OF STUDY
6/7 RESEARCH METHODOLO8Y
10
6/5 LIMITATION OF T HE STUD Y
1!
CHAPTER; COMPANY PROFILE
1#
;/6 INDUSTRY PROFILE
1,
;/; PRODUCT PROF ILE
!0
,
CHAPTER= REVIEW OF LITERATURE
!
CHAPTER7 DATA ANALYSIS AND INTERPREATATION
!
2
CHAPTER5
,
CONCULATION
BIBLIO8RAPHY
FINDIN8 SU88ESTIONS
2
LIST OF TABLES T%&e No/ 6
T"t&e
P%N *eo/
34'C5 6ank jewel loan 7/8 T98C 6ank jewel loan
=;
;
34'C5 6ank jewel loan 7/8 '-9D-9 :3-*- 6ank
==
=
34'C5 6ank jewel loan 7/8 U36-9 6ank jewel loan
=7
7
34'C5 6ank development loan 7/8 T98C 6ank business loan
=3
5
34'C5 6ank development loan 7/8 '-9D-9 :3-*- 6-9;
=>
3
=?
>
34'C5 6ank development loan 7/8 U36-9 6ank business loan 34'C5 6ank secured loan 7/8 T98C 6ank
?
34'C5 6ank secured loan 7/8 '-9D-9 :3-*- 6ank
76
<
34'C5 6ank secured loan 7/8 U36-9 6ank
7;
64
(ast four years revenue statement
77
66
!00+ to !002 loan details
7>
6;
9o of loan did not finish with in duration
5;
6=
6ank loan bad debts in !00, to !002
57
67
(ast four year bank loans
53
65
< of contribution in every loan
5?
63
< of increase = decrease bank loans
37
-!
2
74
LIST OF CHARTS CHART TITLE NO 6 (ost four year 3evenue statement
PA8/E NO/ 75
;
:rowth of ncome
73
=
>ewel (oans
7?
7
>ewel (oan 8pecial
7<
5
Development (oan
54
3
8ecured (oan
56
>
9o of loan did not finish with in duration
5=
?
6ank loan bad debts in !00, to !002
55
<
!00+ ? !00, (oan contribution
34
64
!00, ? !00 (oan contribution
36
66
!00 ? !002 (oan contribution
3;
6;
!002 ? !00 (oan contribution in first "uarter
3=
-#
CHAPTER – I
INTRODUCTION
CHAPTER6 INTRODUCTION
6/6 INTRODUCTION OF TOPIC1
ndia has a well developed banking system. *ost of the banking in ndia was founded by ndian entrepreneurs and visionaries in the pre?independence era to provide financial assistance to traders to trade% agriculturists and budding ndia industrialist. ndian banks have played a significant role in the development of ndian economy by lending finance to ndian industry.
@hile the 36 became a state owned institution from >anuary 1 st 1+% the banking regulation act was enacted in 1+ providing a framework for regulation and supervision of commercial banking activity. The first step towards the nationaliAation of commercial banks was the result of a report by the committee of direction of all ndia Credit survey. The committee recommended one strong integrated state partnered commercial banking institution to stimulate banking development in general and rural credit in particular.
10
The cooperative banking system is an important constituent of the ndian financial system. The cooperative banks in ndia play an important role in catering to the banking needs of the rural population and of certain sections of the urban population as well. The inade"uacy of rural credit engaged the attention of the 3eserve 6ank and the :overnment throughout the 1,0s and the 10s. The agricultural credit system as it has emerged has been a product of both evolution and intervention.
34'C5 bank is provided the loan in rehabilitating repatriates and customers through following credit system in co?operative act. 6anks provide the loan based on security value. :overned by the *inistry of $ome -ffairs% :ovt. of ndia.
The objective was to serve better the need of development of the confor mity with national priorities and objectives. 4leven years after nationaliAation of commercial bank .The :overnment announced the nationaliAation of si) more scheduled commercial bank.
11
PREREFORM STATUS
@hile technically there was a competition between the banks and non?banks and among bank substantially% competition was conditioned by policy as well as regulatory environment common ownership by the government and agreement between government of ndia as an owner and workers represented by the unions. :overned by the *inistry of $ome -ffairs% :ovt. of ndia.
REFORM MEASURES
The major challenge of the reform has been to introduce element of market incentive as dominant factor gradually replacing the administratively coordinated planned action for development. 8uch paradigm shift has several dimensions% the corporate government being one of the important elements.
During reform period% the policy environment enhanced competition and provided greater opportunity for e)ercise of what may be called genuine corporate element in each bank to replace the element of coordinated the action of all entitled as join family to fulfill the predetermined the priority
1!
THE MEASURES TAKEN FOR REFORM WERE ASFOLLOWS
1B &irst greater competition was infused in banking system by permitting enter of private sector banks to e)ternal loan to all sector and it is mainly focused on the repatriates = customers
!B 8econd the reforms accord greater fle)ibility to the repco banking systems to manage both of the pricing and "uantity of resources for repatriates
#B To strengthen the banking system to cope up with the changing environment% prudential standard has been imposed in a progressive manner in order to enhance the loan to the repatriates
+B -n appropriate legal% institutional and regulatory framework has been put in place for the repatriates other sector markets.
1#
BACK 8ROUND OF THE STUDY
5ver the years people have observed that% a company first task is to create customers but todayEs customers face a vast array of product and brand choices% prices and services. Thus% the traditional marketing theory and practice have focus on attracting new customers rather than retaining e)isting once. Today% however although attracting new customers remain as an important task% the emphasis should also be towards retaining current customers and to build profitable long term relationship with them% but at the same time have to think about the e)pansion of the present market also through the proper promotion.
&acing an e)panding economy and a rapidly growing market% companie s should e)pand their markets for facing new challenges% competitive strategies and practices. :rowing markets meant plentiful supply of new customers. 5rganiAations could keep filling the marketing bucket with new customers are rising% so organiAations should evolve efficient methods to promote their products. t means the entire stream of purchases that the customer would make over a life time of patronage. The key to building everlasting relationship is the creation of superior customer value and satisfaction% and it should be reflected on the promotional activities of the product.
1+
a customer might have different level of e)pectations. $ere if the product services match their e)pectations they may rank it good% if the services e)ceeds e)pectations they may rank it e)cellent% if it is ordinary they may rank it moderate and if the services are not at all good they may rank it poor% thus leading to loss of customers.
The researcher carried a work on standing of 34'C5 6ank .with regard to the loan product. Thus survey is totally based on the selected banks.
This study also helped to get good suggestion from the customers.34'C5 bank has +# branches with operations spread all over ndia.
n order to get more competitive and attract a large base of customers% it is important for service institutions to provide good "uality service to the customer. 3ange and "uality would enable the bank to improve the efficiency of the service offered. The 34'C5 bank has in the past used internal resources in assessing the "uality of service offered. t is now felt that a study among their customers conducted by Fe)ternal agentE would be necessary to gain customers satisfaction with the service offered.
1,
NEED FOR THE STUDY
The project is a comparative analysis of the selected loan of the 34'C5 bank. this project is carried out to find out the standing of 34'C5 loans compare to some selected banks% which includes understand the product awareness and perception among target customers% findings the features on which the sales force and bank should give more importance and do a work to promote the product in the market. Thus% this project becomes essential to get a competitive edge. Through this project an attempt has been made to identify the e)plicit needs% attitude of the customers and promote the loan % as they are the final judge of the services provided by the bank only when the bank is in constant touch with its target customers.
1
6/; OBJECTIVE OF STUDY
PRIMARY OBJECTIVE1
•
Stu#, %$# %$%&,s "s te '%+tors +o$s"# er 'or %$ &o%$s (Rep+o %$. to *r%$te# ee& &o%$ (6 ,e%r.@ ee& &o%$ spe+"%& (3 !o$ts.@ #e-e&op!e$t &o%$ (us"$ess &o%$.@ %$# se+ure# &o%$ (propert, &o%$./
SECONDARY OBJECTIVE1
•
Stu#, %$# %$%&,s"s to te se+ur"t"es %-%"&%&e o' +usto!er/
•
12
To stu#, %$# %$%&,s"s te rep%,%&e #ur%t"o$ o' te &o%$
6/= SCOPE OF STUDY
•
To "#e$t"', te est 'or! o' &o%$ %-%"&%&e "$ %$/
•
To pro-"#e &o%$ %se# o$ +usto!er +o$-e$"e$+es/
•
Te eG%!"$e poss""&"t, o' &o%$ e+o!"$* %# %$# su**est"$* +orre+t !e%sures/
1
6/7 RESEARCH METHODLO8Y RESEARCH DESI8N
3esearch in common parlance refers to search for knowledge. 5ne can also define research as a scientific and systematic search for pertinent information on a specific topic. - research design is the arrangement of conditions for collection and analysis of data in a manner that aim to combine relevance to the research purpose with economy in procedure. n fact research design is the conceptual structure within which research is conductedG it constitutes the blueprint for the collection% measurement and analysis of data.
STATEMENT OF PROBLEM
This research is conducted to know the various ways to increase the loan product through conducting comparative study with the product of the competitors and knowing the bank report banks loan product. The study is also trying to find the standing of the 345C5 bank loan product in the market and suggest ways to make the product more customers% oriented and effective. t is also going to help the organiAation to retain its business and for further growth.
1
SOURCES OF DATA1
D%t%s1
The secondary includes the findings or the basic research already done by the organiAations. 6eside% it also includes the appropriate material from newspapers% journals% reports and books and internet.
Se+o$#%r, D%t%s1
-udit report 6alance sheets Company profile report
!0
6/5 LIMITATION OF STUDY
•
To stu#, %$# %$%&,s"s %&& te &o%$s ut T"!e %-%"&%&e "s sort (<4#%,s. so %&& &o%$s +ou&# $ot e 'u&&, %$%&,ses/
•
Tere "s $o su''"+"e$t t"!e to !eet te +usto!er/
•
D"# $ot +o&&e+t te 'u&& "$'or!%t"o$ re&%t"$* to +urre$t ,e%r/
!1
CHAPTER – II
COMPANY PROFILE
!!
CHAPTER; COMPANY PROFILE
34'C5 6-9; (td. was commenced in the year 1 by :ovt. of ndia with the main objective of rehabilitating repatriates from 6urma and 8rilanka. The 8chemes are open to all on admission as members of the bank so as to enable the bank serve its main objective effectively. The bank is governed by the *inistry of $ome -ffairs% :ovt. of ndia. 6ank after 1,to start a commercial banking service. 6ank only to provide financial service only for repatriates in previews. *ultistate co? operative act 1, bank was started commercial service. 6anks provide the service in two types of customers - HclassB = 6 HclassB. - HclassB customers is a share holder of the bank% 6 HclassB customer is other then repatriates share holders. 6anks provide the service mainly for repatriates. 8o bank give the some of the special benefits in rate of interest 1< reduce all loan rates and 1< increases all deposit rates. 8hare capital of the bank constitutes government investment. The share capital was subscription by state government HTamilnadu% -ndrapradesh% ;arnataka% ;erala% 'ondicherry% and individual repatriatesE members. 6anking administrated nominated by the government of ndia. The chief e)ecutive director looks day to day banking operation. 6anks has now ++ branches cover the five states.
!#
E)u"t, +%p"t%&1
The bank share capital has touched 3s ,.0! crors. -ctual number of member as on #1?#?02 reach levels of !11# - class member .the bank proposes to pay dividend of !#< for the year !00?!002 amounts of 111.! lakh. To the participating government and - class repatriate members.
!+
;/; INDUSTRY PROFILE
The cooperative banking system is an important constituent of the ndian financial system. The cooperative banks in ndia play an important role in catering to the banking needs of the rural population and of certain sections of the urban population as well. The inade"uacy of rural credit engaged the attention of the 3eserve 6ank and the :overnment throughout the 1,0s and the 10s. The agricultural credit system as it has emerged has been a product of both evolution and intervention% and symboliAes the systemEs response to the stimuli from continuing dissatisfaction with credit delivery
The 3eserve 6ank of ndia -ct% 1#+ has specific provisions relating to agricultural credit. 8ection ,+ of the 36 -ct specifically authoriAed the creation of an -gricultural Credit Department within the 3eserve 6ank to deal not only with the rural credit but also with the long?term finance including refinance. 8ection 12 of the -ct empowered it to provide agricultural credit through state cooperative banks or any other banks engaged in the business of agricultural credit. The foundation for building a broader credit infrastructure for rural credit was laid down by the -ll ndia 3ural Credit 8urvey H1,+B.
The Committee of Direction that conducted the survey recommended the creation of 9ational -gricultural Credit &und% which was subse"uently created by the 3eserve 6ank. The -gricultural 3efinance Corporation H-3CB set up by the 3eserve 6ank in 1# provided funds by way of refinance% but credit cooperatives still did not function too well.
!,
1,
DecentraliAed credit planning through the (ead 6ank 8cheme was also introduced to spearhead the credit allocation for agricultural lending.
n order to emphasiAe the developmental and promotional role assigned to the -3C in addition to refinancing% the -3C was renamed as the -gricultural 3efinance and Development Corporation H-3DCB in 12,. Despite all these efforts% the flow of credit to the agricultural sector failed to e)hibit any appreciable improvement as the cooperatives lacked resources to meet the e)pected demand. To solve these problems% the 3egional 3ural 6anks H336sB were set up in 12,. n order to strengthen the institutional credit for agriculture and rural devel opment% 9-6-3D was set up on >uly 1!% 1!. 5n its establishment% 9-6-3D took over the entire functions of the -3DC% the refinancing functions of the 3eserve 6ank in relation to cooperatives and 3egional 3ural 6anks H336sB.
The 8tate :overnment and the 3egistrar of Cooperative 8ocieties appointed by the 8tate are the main regulatory authorities for the cooperative societies that are operating only within a 8tate.
The regula tion and supervision of the urban cooperative banks HUC6sB have been brought within the ambit of the 3eserve 6ankEs statutory control under the 6anking (aws Has -pplicable to Cooperative 8ocietiesB -ct% which came into force from *arch 1% 1. The regulatory powers conferred on the 3eserve 6ank with regard to cooperative banks are limited.
!
@hile the princi ples of supervision with regard to cooperative banks have been formulated and implemented by the 3eserve 6ank in respect of UC6s under the 6anking 3egulation -ct% 1+% the -ct does not apply to primary agricultural credit societies and land development banks% thus leaving them under the regulatory purview of the 8tate.
5ne important feature of providing agricultural credit in ndia has been the e)istence of a widespread network of rural financial institutions.
The present structure of the rural financial institutions consists of a three?tier rural cooperative credit institut ions H'rimary agricultural credit societies% District central cooperative banks% and 8tate cooperative banksB% 336s% (ocal area banks% urban cooperative banks and branches of commercial banks. 8ome important issues relate d to regulation and supervision of cooperative banks is discussed in this section.
The rural credit structure consists of many types of financial institutions as large scale branch e)pansion was undertaken to create a strong institutional base in rural areas. The number of various cooperative institutions at present is over 110%000. This has led to an e)pansion in rural credit. $owever% the share of cooperative institutionsE credi t to agriculture has been declining with the share of commercial banks and 336s increasing during the 10s and 10s H*oh an% !00+aB. This calls for a wider reach of the cooperative credit institutions.
nstances such as the *adhavapura *ercantile Cooperative 6ankEs failure brought to the fore the need to have stringent regulatory control over the cooperative banking system. n order to strengthen the supervisory mechanism% the 3eserve 6ank e)tended the
!2
12
5ff?site 8urveillance 8ystem H588B to all non?scheduled UC6s having deposit siAe of 3s.100 crore and above. - supervisory reporting system was introduced for the scheduled UC6s since *arch !001 as a first step towards setting up of 588 for all UC6s.
The capital ade"uacy norms have been introduced in a phased manner since *arch !00!. 6etter risk management through avoidance of concentration of credit risk% off?site surveillance for non?schedule UC6s and following up of ;IC guidelines have also been introduced to strengthen the UC6s.
- total ban has been imposed since 5ctober !00# on grant of loans and advances to directors of UC6s% their relatives and concerns in which they have interest with a view to preventing certain irregularities. The 3eserve 6ank has also directed that UC6s should undertake usual due diligence in respect of investments in non?8(3 securities. The 3eserve 6ank introduced a new system of grading of UC6s in -pril !00#% which is based on their C3-3% level of net 9'-s% record of losses and compliance with regulatory environment. 8imilarly% a system of supervisory rating for UC6s under the C-*4(8 model has also been introduced. nitially% it was implemented for scheduled UC6s but% subse"uently its simplified version was e)tended to non?scheduled UC6s in *arch !00+.
9otwithstanding the structural and cultural differences between UC6s and commercial banks% the above measures suggest that the 3eserve 6ank has been e)ercising its regulatory and supervisory powers to ensure that the cooperative credit structure is strengthened on the lines similar to the regulation and supervision of commercial banks.
!
n sum% the 3eserve 6ank has been bestowing great er attention in recent years towards strengthening of the regulation and supervision of the cooperative banking structure in the country.
-s a prudent step towards aligning the UC6s with the financial system% a Draft 7ision Document H!00,B of the 3eserve 6ank seeks to rationalise the e)isting regulatory and supervisory systemG facilitate a focused system of supervision through enhancement of technologyG and to evolve mechanism to address the dual control. The future course of action envisaged by the 3eserve 6ank is to remove operational irritants and to strengthen the UC6s and align them with the commercial banks.
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;/= PRODUCT PROFILE
6anks provide !0 types of loans but analysis of study is fore leading loans following. >ewel loan% >ewel loan special% development loan% secured loan. This bank lends the ma)imum no of loans
6. JEWEL LOAN 1
(oan ma)imum duration is within one year only. This type of loan is short period only. 3ate of interest 1!.,< pa% minimum 1, days rate of interest to calculated. Lo%$ &"!"tJ
*a)imum loan amount fi) by head officers. (oan limit of the bank is 3s 200 per gram gold. Appr%"s%& o' ee&1
-ppraisal appointed by head office. -ppraisal gets only commission based on lone. Appr%"s%& pro+ess1
1. Touchstone testing !. 9itric acid testing
#0
#. Testing by filing +. @ater testing ,. :old purity
CERTIFICATION VALUE OF 8OLD J
1. :ross weightJ &irst cheek gold gross weights its total gold weight. !. 9et weightJ -fter cheek the gross weight to find net weight. The net weight is to less stone and other dust in gross weight. #. 'urity valueJ 'urity value calculates the gold cerate and purity value. +. 3ate of per gramJ 'urity value based to fi) the rate of per gram vale. ;. Jee& &o %$ spe+"%&1
(oan ma)imum duration is very short period with in one si) months only. This type of loan is short period only. 3ate of interest 1!.,< pa% minimum 1, days rate of interest to calculated.
Lo%$ &"!"t
*a)imum loan amount fi) by head officers. (oan limit of the bank is 3s 2,0 per gram gold.
#1
Appr%"s%& o' ee&1
-ppraisal appointed by head office. -ppraisal gets only commission based on lone. Appr%"s%& pro+ess1
1. Touchstone testing !. 9itric acid testing #. Testing by filing +. @ater testing ,. :old purity
J CERTIFICATION VALUE OF 8OLD 6/ 8ross e"*t1
&irst cheek gold gross weights its total gold weight. ;/ Net e"*t1
-fter cheek the gross weight to find net weight. The net weight is to less stone and other dust in gross weight. =/ Pur"t, -%&ue1
'urity value calculates the gold cerate and purity value. 7/ R%te o' per *r%!1
'urity value based to fi) the rate of per gram vale.
#!
=. De-e&op!e$t &o%$
The development loan ma)imum repayable duration is four year only. The interest on loan amount must be declared only on the basis of period of repayment made by the customer. 8ecurity value based to give the loan. 6ank first cheek the legal pros edger and formalities and following thinks.
Wo!1
Development loan may be granted to borrowers for improving business purpose. (oans provide all type of legal business in processing of this business and e)isting business. 1B Trade !B 6usiness #B ndustry group +B 8tarting new business in same other branches.
Pro+e#ure o' s%$+t"o$ te &o%$1
-pplication for loan will be consider by the loan sanctioning authority with reference to the viability of the project. 6ank verifying following all documents.
##
Do+u!e$ts1
1B (ast fore year audit report !B 5wnership of business #B *unicipality or cor poration license +B 4vidence of the material purchase ,B Cash = fund flow statement B 'rinter balance sheet in five years 2B *achine detail record B 8ales = purchase account register B 3ent receipt
To verify all related document inspection officer. -fter verify to give loan itEs a branch manager response. (oan is based on security and turnover of the income states only to provide. L"!"t o' &o%$1
(oan limit is fi)ing 0< of security value. 8ecurity values calculate register value only. (imit of loan to fi)ing by head officer only. R%te o' "$terest1
6elow ! laks loan K 12., <
#+
-bove ! laks loan K 1 <
5. Se+ure# &o%$1
This loan is a long term loan. The repayable period is , to 10 years. nterest rate and duration period are determined on the basis of the loan amount. The loan amount is varying from one customer to another customer on the basics of the securities offered by the customer against the loan. 34'C5 6ank to give 8ecurity loan provide only for bank members. 8ecurity value based to grant the loan% in is following rules under the head of the banking norms.
Pro+e#ure o' s%$+t"o$ te &o%$1
-pplication for loan will be consider by the loan sanctioning authority with reference to the viability of the project. 6ank verifying following all documents. Do+u!e$ts1
1B
5wnershipoftheland
!B
(andorpropertydocument
#B (and valuation report +B 3egistration doc ument ,B 8ecurity document L"!"t o' &o%$1
(oan limit is fi)ing 0< of security value. 8ecurity values calculate register value only.. R%te o' "$terest1
3at of interest is 1< per annum
#,
CHAPTER – III
REVIEW OF LITERATURE
#
CHAPTERIII REVIEW OF LITERATURE
The main purpose of literature review is to e)amine recent or historically significant research studies% company details% or industry reports% which act as a basis for the proposed study. 6eing find out the data related to literature and relevant secondary data from a comprehensive perspective% moving to more we can conduct the proposed study and can avoid the faults in the need for the proposed work to appraise the short coming and information gap in secondary data sources. This analysis helps to go beyond scrutiniAing the available of or conclusions of past studies and their data% to e)amine the accuracy of secondary sources% the credibility of the sources% -nd appropriations or earlier studies.
MEDHOD OF REVIEW I HAVE DONE
@ebsites% books% journals% and other relevant bank reports conduct this project. n internet% :oogle search engine was mainly used to collect information from different websites for this project. This help to get an idea about the research topic. The websites of the banks such as 34'C5 bank% 36 bank% and T9C' bank helped to me to get a lot of information about the banks and their different loan products.
#2
6y going through various websites% books% and other internal audit records% it gave me more information about the banking industry% 34'C5 bank and the project topic. t also helped to the earlier similar research% conclusion derived from the earlier researches etc. the internet facilitated more to know about the various researches conducted by various organiAations. t even helped in preparing the tools.
#
CHAPTER – IV
DATA ANALYSIS And INTERPRETATION
#
CHAPTERIV ANALYSIS AND INTERPRETATION
TOOLS USIN8 FOR ANALYSIS1 Co!p%r%t"-e st%te!e$t %$%&,s"s1
Comparative statement is the business to prepare the information which access direction change in position .n this statement figure of two or more periods of placed side by side facilitates Comparison.
Compare with last fore year statement to analysis the dataEs
Per+e$t%*e !eto#1
@hen there are more series of data this percentage method is used to compare the relation ship.
9o of respondents < of respondents K
?????????????????????????? Total no of respondents
+0
L 100
DATA ANALYSIS AND INTERPRETATION
I$tro#u+t"o$1
n this comparative analysis% for jewel loans% jewel loan special% development loan % secured loan of 34'C5 bank are compare d with other banks rate of interes t . The loan product comparative analysis and percentage method to use in the calculation. The data for comparison are obtained through secondary data collection. The features% benefits and interest charges of each loan product of 34'C5 bank are comparing with other competitive banks.
To find best loan in the bank% and calculate the comparative analysis and percentage method.
+1
THE TAMIL NADUSTATE APE COOPERATIVE BANK LTD/ CHENNAI
The Cooperative 6anks functioning in Tamil 9adu are fulfilling the credit re"uirements of the farmers% weavers% rural artisans% consumers of urban area. These institutions are known as Cooperative Credit nstitutions. The Coop. institutions are functioning under two categories. They areJ long?term coop. credit institutions% short?term coop. credit institutions. The coop. credit institutions functioning under short?term credit structure are of three?tier in nature. -t the grass root level% the 'rimary -gricultural Coop. 6anks H'-C6sB is functioning at village level. -t the district level% the Central Coop. 6anks HCC6sB is functioning with the head"uarters at district capital and their branches in various places of the districts concerned. -t the ape) level% the Tamil 9adu 8tate -pe) Coop. 6ank (td.% HT98C 6ankB is functioning at Chennai which co?ordinates the entire short? term coop. credit structure. The Tamil 9adu 8tate -pe) Co?operative 6ank (td.% commenced its business during 9ovember 10, as an Urban Coop. 6ank. t was subse"uently changed into a District Central Coop. 6ank during >uly 1!0. -t present% the 6ank is functioning at Chennai with ++ branches% an 4)tension Counter and $.5. T98C 6ank is guiding the Dist. Central Coop. 6anks / 'rimary -gricultural Coop. 6anks in their functioning and it is playing a major role in the coop. movement of Tamil 9adu.
+!
T98C 6ank was formed in the year in which the coop. movement of Tamil 9adu was formed. -s such% the 6ank has been serving the people of Tamil 9adu for a centenary for their economic development. -s far as ndian coop. movement is concerned% the 6ank has commenced its business from the very ne)t year of the formation of coop. movement in ndia. T98C 6ank is the first ever 8tate Coop. 6ank having the credit of celebrating the centenary year.
T98C 6ank has got the license of 3eserve 6ank of ndia to carry on the banking business. T98C 6ank is a 8cheduled Coop. 6ank and has been listed under the 8econd 8chedule of 36 -ct. T98C 6ank is a member of the Deposit nsurance and Credit :uarantee Corporation HDC:CB and is an insured coop. bank as per DC:C -ct. T98C 6ank has got the privilege of having its share capital by the :overnment of Tamil 9adu. T98C 6ank has been under close supervision and monitoring of the higher financing agencies% viA.% 36% 9-6-3D. 'eriodical inspection and supervision are done by 9-6-3D as per 36 guidelines. :overnment of Tamil 9adu is reviewing the performance of the 6ank periodically.
TNSC %$ r%t o' "$terest
>ewel loan
K 10< pa
(oan an per gram K 00 3s Development loan rate of interest K 1 <
+#
COMPARISON OF JEWEL LOAN TABLE 2 6
34'C5 6ank >ewel (oan 7/8 T98C 6ank >ewel (oan
N%!e o' te
M"$"!u! o'
R%te o'
Lo%$
&o%$
&o%$ per *r%!
"$terest
per"o#
B%$s
34'C56ank
>ewel(oan
3s200
1!<
1Iear
T98C6ank
>ewel(oan
3s00
10<
1Iear
34'C5 >ewel (oan and T98C 6ank >ewel (oan are popular loans of both the 6anks. The 34'C5 6ank rate of interest is 1!< per annum. 6ut T98C 6ank rate of interest is 10<. 6oth 6anks ma)imum period of >ewel loan is 1Iear. Compare with both banks 34'C5 6ank is charging !< high rate of interest. 34'C5 6ank provide ma)imum lone of 3s 200 per gram% but T98C 6ank provide only 3s 00 per gram of ma)imum limit. Compare with two banks 34'C5 6ank gives 3s 100 more than T98C 6ank. 6oth 6anks are giving the minimum loan amount ,000. Compared with two banks 34'C5 6ank charges high rate of interest in !< high.
TABLE 2 ;
++
REPCO B%$ Jee& Lo%$ VS PANDIAN 8RAMA B%$ Jee& Lo%$
N%!e o' te
M"$"!u! o'
R%te o'
Lo%$
&o%$
&o%$ per *r%!
"$terest
per"o#
B%$s
34'C56ank
>ewel(oan
3s200
1!<
1Iear
>ewel(oan
3s,,0
11<
10*onths
'-9D-9 :3-*6ank
34'C5 >ewel (oan and '-9D-9 :3-*- 6ank >ewel (oan are the popular loan both the 6ank. The 34'C5 6ank rate of interest is 1!< per annum and ma)imum loan period is 1 Iear. 6ut '-9D-9 :3-*- 6ank rate of interest is 11< and ma)imum loan period is 10 *onths. @hen compared with both banks 34'C5 6ank charging 1< high rate of interest. 34'C5 6ank provide ma)imum lone of 3s 200 per gram% but '-9D-9 :3-*- 6ank provide only 3s ,,0 per gram of ma)imum limit. @hen Compare with two banks 34'C5 6ank gives 3s 1,0 more than '-9D-9 :3-*- 6ank. 34'C5 6ank is giving the minimum loan amount 3s ,000% 6ut '-9D-9 :3-*- giving the minimum loan amount 3s +000. Compare with two banks 34'C5 6ank charge high rate of interest% That is 1< high. TABLE 2 = REPCO B%$ Jee& Lo%$ VS URBAN B%$ Jee& Lo%$
+,
N%!e o' te
M"$"!u! o'
R%te o'
Lo%$
&o%$
&o%$ per *r%!
"$terest
per"o#
B%$s
34'C56ank
>ewel(oan
3s200
1!<
1Iear
3s,0
11<
1Iear
U36-9 6ank
>ewel(oan
34'C5 >ewel (oan and U36-9 6ank >ewel (oan are popular loan of both the 6ank. The 34'C5 6ank rate of interest is 1!< per annum. 6ut U36-9 6ank rate of interest is 11<. 6oth of 6anks ma)imum period of >ewel loan is 1Iear. Compare with both banks 34'C5 6ank charging 1< high rate of interest. 34'C5 6ank provide ma)imum lone of 3s 200 per gram% but U36-9 6ank provide only 3s ,0 per gram of ma)imum limit. Compare with two banks 34'C5 6ank gives 3s ,0 more than U36-9 6ank. 6oth 6anks are giving the minimum loan amount 3s ,000. Compared with two banks 34'C5 6ank charge high rate of interest% That is 1< high.
n this Comparative analysis we find than comparison with other banks 34'C5 6ank is charging high rate of interest. -t the same time 34'C5 6ank provides ma)imum lone of 3s 200 per gram compared with other selected banks. -ll selected banks to maintain of loan duration on 1 year and '-9D-9 :3-*- 6ank maintains is 10 months only. +
TABLE 2 7 COMPARISON OF BUSINESS LOAN
34'C5 6ankEs development loan 7/8 T98C 6ank business loan
+2
M%G"!u! o' B%$
N%!eo'&o%$
R%to'"$terest &o%$ %!ou$t
Development
0< of security 1<
REPCO B%$
loan
TNSC B%$
6usinessloan
value
1<
20< of security value
$ere have taken the basic 6U8948 (5-9 of selected banks for the comparison. Development loan of the 34'C5 6ank and business loan of the T98C 6ank. 6oth banks provide loan only for business purpose. 34'C5 6ank charge 1< rate of interest% but T98C 6ank charge 1< rate of interest. 6oth the banks provide loan based on security value. 34'C5 6ank to give the ma)imum loan is 0< of security value T98C 6ank to give the ma)imum loan is 20< of security value. 34'C5 6ank provides loan only to e)isting business only but T98C 6ank to give to new and e)isting business.
TABLE 2 5
REPCO B%$s #e-e&op!e$t &o%$ VS PANDIAN 8RAMA B%$ us"$ess u$"t &o%$ B%$
+
N%!eo'&o%$
R%to'"$terest
M%G"!u!o'
&o%$ %!ou$t
Development
0< of security 1<
REPCO B%$
loan PANDIAN
value
6usiness unit
20< of security 1<
8RAMA B%$
loan
value
Development loan and business unit loan are the very familiar loan in both banks. 6oth banks provide loan only for business purpose. 34'C5 6ank charge 1< rate of interest% '-9D-9 :3-*- also charge same rate of interest. 6oth the banks provide loan based on security value. 34'C5 6ank to give the ma)imum loan of 0< of security value '-9D-9 :3-*- 6ank to give the ma)imum loan is 20< of security value. Two banks provide loan only to e)isting business only. 5f the two banks 34'C5 6ank to highly charge 1< rate of interest when compared to '-9D-9 :3-*- 6ank.
TABLE 2 3 REPCO B%$s #e-e&op!e$t &o%$ VS URBAN B%$ us"$ess &o%$ M%G"!u! o' B%$
N%!eo'&o%$
R%to'"$terest &o%$ %!ou$t
+
Development
0< of security 1<
REPCO B%$
loan
value 0< of security
URBAN B%$
-gri loan
< value
34'C5 6ank provides business loan is development loan for business development purpose. 6ut U36-9 6ank provide business loan only for agriculture purpose. 34'C5 6ank is to charge 1< rate of interest% U36-9 6ank < rate of interest to be charge. 6oth the banks provide loan based on security value. 34'C5 6ank to give the ma)imum loan is 0< of security value U36-9 6ank to give the ma)imum loan is 20< of security value. 5f the two banks 34'C5 6ank charge 10< rate of interest compare with U36-9 6ank. U36-9 6ank mainly concentrates on farmers so to give low rate of interest. 34'C5 6ank provides loan for commercial purpose so as to get high rate of interest.
n this Comparative analysis to find comparison with other banks 34'C5 6ank to charge high rate of interest. -t the same time 34'C5 6ank provide ma)imum lone of 0< of security value compared with other selected banks. -ll selected banks to provide loan for business purpose% developing business% and start new business. 34'C5 6ank collected ,0
loan from customer on 4*. 6ank provide loan on :57T value to be calculated. 34'C5 6ank couldnEt give for new businessG other banks give to the new business.
TABLE 2 > COMPARTIVE OF SECURED LOAN
REPCO B%$ se+ure# &o%$ VS TNSC %$
,1
M%G"!u! o' B%$
N%!eo'&o%$
R%to'"$terest &o%$ %!ou$t
REPCO B%$
8ecuredloan
1<
0<
TNSC B%$
'ropertyloan
1<
0<
$ere have taken the basis of 84CU34D (5-9 from selected banks for the comparison. 84CU34D loan of the 34'C5 6ank% and '35'43TI loan of the T98C 6ank. 6oth banks provide loan only for buying new property. 34'C5 6ank charges 1< rate of interest% but T98C 6ank charges 1< of rate of interest. 6oth the banks provide loan based on security value. 34'C5 6ank is to give the ma)imum loan of 0< of security value T98C 6ank also gives the ma)imum loan of 0< of security value. @hen compared to analysis of the two banks 34'C5 6ank charges high rate of interest.
TABLE 2 ? REPCO B%$ se+ure# &o%$ VS PANDIYAN 8RAMA B%$
,!
M%G"!u! o' B%$
N%!eo'&o%$
R%to'"$terest &o%$ %!ou$t
REPCO B%$
8ecuredloan
1<
0<
TNSC B%$
'ropertyloan
1<
20<
8ecurity loan and property loan are provided only for buying new property or buying new land. 34'C5 6ank charges 1< rate of interest% '-9D-9 :3-*- charges 1< rate of interest. 6oth the banks provide loan based on security value. 34'C5 6ank is to give the ma)imum loan of 0< of security value '-9D-9 :3-*- 6ank is give the ma)imum loan of 20< of security value. Two banks lending loan only buy new property. 5f the two banks 34'C5 6ank to charge !< rate of interest compared to '-9D-9 :3-*- 6ank.
TABLE 2 < REPCO B%$ se+ure# &o%$ VS URBAN B%$
,#
M%G"!u! o' B%$
N%!eo'&o%$
R%to'"$terest &o%$ %!ou$t
REPCO B%$
8ecuredloan
1<
0<
8ecure property 1!<
URBAN B%$
0<
loan
8ecurity loan and property loan are provides only for buying new property or buying new land. 34'C5 6ank charges 1< rate of interest% U36-9 6ank charges 1!< rate of interest only. 6oth the banks provide loan based on security value. 34'C5 6ank is to give the ma)imum loan of 0< of security value U36-9 6ank to give the ma)imum loan 0< of security value. Two banks lending loan only to buy new property of the two banks 34'C5 6ank is to charge < rate of interest compared to U36-9 6ank.
n this Comparative analysis to find comparison with other banks 34'C5 6ank is to charge high rate of interest. -t the same time 34'C5 6ank provides ma)imum lone is 0< of security value compared with other selected banks. -ll selected banks to provide loan for buying new land or property. 34'C5 6ank was collected loan from customers to 4*. 6ank provides loan on :57T value to be calculated. ,+
34'C5 6ank loans compared with other selected banks loan interest is high in all type of selected loans. >ewel loan% development loan% secured loan are the ma)imum loan limit is high compared with other selected banks.
TABLE 2 64 Pre-"ous 'our ,e%rs re-e$ue +o!p%r%t"-e st%te!e$t
I4-3
,,
34749U4 9 (akhs
9C34-84 9 (akhs
< 5& 9C34-84
;44=;447
,20
!00+?!00,
!!
;447;445
!!
!00,?!00
#+#
;445;443
#+#
!00?!002
10+
,!
1<
1,!1
!!<
!#+1
!<
The bank revenue increased in last four year. Compare to the last fore year statement. 3evenue is increased in ,! lakh% 1,!1lakh% !#+1 lakh respectively.
CHART 2 6
COMPARITIVE STATEMENT OF BANK REVENUE
,
CHART 2 ;
8ROWTH OF THE INCOME ,2
TABLE66
;447 to ;44> %&& &o%$ #et%"&s "$ tous%$#
,
I4-3
'-3TCU(-3 !00+?!00,
>ewelloan >ewel loan special
Development loan
8ecuredloan
!+#
!00,?!00
##.,
!00?!002
#2,+!.,
!002?!00
,1.#
20.#
1!,1+.
+!+.1
122.1
120,
12!
1#+.!!#
!0!,
+22.+
,+0#0.,
+#!.
1!1#+.
I$'ere$+e1
&rom the above table shows last fore years loans in thousands. !00+ to !00 selected loans of jewel loan% jewel loan special% development loan% and secured loan reports in thousands. (oan particulars are given in the 1st "uarter of !002?!00.
CHART 2 =
,
CHART 2 7
0
CHART 2 5
1
CHART 2 3
!
TABLE6; #
NO/ OF LOAN THAT DIDNOT FINISH WITH IN YEAR
P%rt"+u&%r
Ye%r ;445;443
>ewel loan
+2
,1
>ewelloanspecial
20
,1
Developmentloan
1!
!+
8ecuredloan
1
1
Total
1+,
I$+re%ses
De*re%ses
#<
?
?
1#<
<
?
1.,<
?
?
?
Ye%r ;443;44>
1++
n a particular year some of customers didnEt finish loan in the particular period. The minimum customer could not pay development loan and secured loan with in scheduled time. >ewel loan has been decreas e to 1#< in !00, and !00. 6ut other loans have been increased
+
CHART 2 >
NO/ OF CUSTOMERS DIDNOT FINISH WITH IN A DURATION
,
TABLE6= B%# #et o' ;445;443 ;443;44> %$ &o%$
'articular
Iear !00,?!00
Iear !00?!002
>ewel loan
!+
1
>ewel loan special
#2
#0
Development loan
8ecured loan
0
0
0
0
I$'ere$+e1
The above table shows that bad debt position of loans in last two year. The bad debt of jewel has been decreased from #2 to #0.
CHART 2 ? B%# #et o' ;445;443 ;443;44> %$ &o%$
TABLE67
2
L%st 'our ,e%rs %$ &o%$ "$ tous%$#s
TYPES OF LOAN
;44745
;44543
;4434>
>4@4((5-9
!+#
>4@4( (5-9 8'4C-(
20.#
1!,1+.
+!2.1
122.1
D474(5'*49T (5-9
120,
12!
1#+.!
!0!,
84CU34D (5-9
+22.#
,+0#0.,
+#!,.
1!,#+.
$5U849: (594
!,,.+
1+2#.#
2#,.
M
8-(-3I (5-9
#,.1
!+!.,
1!
#.
74$C4( (5-9
+2.
#.
1#!
#+
4DUC-T59 (5-9
2.,
#.#
M
M
5D (5-9
2
C598U*43 (5-9 (4-84 (5-9
##.
;44>4?
#2,+!.,
11#
12. M
,1.#
1+,
1!.# M
!10 +
M M
M
*4DC-( (5-9
M
M
M
M
*C35 &9-9C4
+##.
!02
#0
#+
(5-9 59 D4'58T
+##
,2!.
,2
1+
I$'ere$+e1
34'C5 6ank varies type of loan lending to customer. They give ma)imum of loan for secured loan and development loan respectively. !002?!00 is an only 1 amounts H-pril?>uneB.
TABLE 65
st
"uarter loan
o' +o$tr"ut"o$ "$ e-er, ,e%r
TYPES OF LOANS
;44745
;44543
;4434>
;44>4?
>4@4( (5-9
!!<
!2<
!#<
1+<
>4@4( (5-9 8'4C-( D474(5'*49T (5-9
<
<
!2<
+<
1<
1#<
11<
,<
84CU34D (5-9
++<
+0<
!2<
#0<
$5U849: (5-9
!.,<
1<
0.,<
?
8-(-3I(5-9
0.<
0.!<
1<
0.!<
74$C(4(5-9
0.!<
0.,<
?
0.1<
4DUC-T59 (5-9
0.!<
5D (5-9 C598U*43 (5-9 (4-84 (5-9
1< 0.!< ? ?
*C35 &9-9C4
0.#<
I$'ere$+e1
20
+<
?
0.!<
1<
0.1< ?
*4DC-( (5-9
(5-9 59 D4'58T
0.!<
+<
? ?
? !<
0.,<
? ?
?
?
!.,< +<
? !< 0.+<
34'C5 6ank providing varies type of loans to the customers. They give ma)imum preference to secured loan and development loan respectively. Compare with other loans more loan amount provided to jewel loan special +< of total amount within first "uarter H!002?!00B.
CHART 2 <
21
CHART 2 64
2!
CHART 2 66
2#
CHART 2 6;
2+
TABLE63
2,
%$ &o%$s
Iears
>ewelloan
!00+?!00, !00,?!00 !00?!002 !002?!00 Total
!0< #0< #1< 1< 100<
>ewelloan special 2< .,< #0< #0.,< 100<
Development loan !< !< #0< 1#< 100<
8ecured loan !+.,< !< !!.,< !,< 100<
o' "$+re%se #e*re%ses %$ &o%$s
Iear
>ewelloan
>ewel loan special
Development loan
8ecured loan
!00,?!00
10<
!.,<
?1<
+.,<
!00?!002
11<
!0.,<
1!<
?,.,<
!002?!00
?1!<
!#.,<
?12<
!.,<
2
CHAPTER – V
FINDING & SUGGESTIONS
22
CHAPTERV FINDIN8S SU88ESTIONS FINDIN8S The major finding in this project% it is found then comparative analysis of the bank
loans in 34'C5 6ank is charging high rate of interest.
They are not providing loans to start the new business and entrepreneurs.
They are providing property loans based on the government value of the property.
8o the customer will get small amount of loan.
They took long time to process and provide loan.
t is found in the comparative analysis of the bank jewel loan special growth is
!,< increasing compared with last # years. -t the same time jewel loan is slowly down at 1!< compared with last ! years.
t is found in the comparative analysis of the bank D474(5'*49T (5-9 is
down at 12< compare with last year.
t is found than the trend analysis of the bank ma)imum amount of loan provided
to the 84CU34D (5-9.
2
SU88ESTIONS
Competitive banks are receiving low rate of interest. 8o% they must decrease rate
of interest.
-ll other banks have to give new business and entrepreneurs loans. 8o% they must
give these types of loan.
'roperty loans must to give a based on normal value of the property.
They must increase processing speed and provide loans "uickly.
Compare with previous years% months jewel loan special is increased compared
with 1! month jewel loan. 8o they will concentrate # months jewel loan.
&inally% bank must increase the different types of schemes in secured loans.
6ank must split the amount in to other loans.
2
CHAPTER – VI
CONCLUSION 0
CONCLUSION
34'C5 6ank having lot of loan schemes% but they concentrate on some particular loans like secured% jewel (oan% 9ot concentrate on some other loans like lease% vehicle% consumer loan and etc. They should create attractive schemes for loan based on customer needs and% if they reduce the rate of interest compar e with other compet itive bank rates% they can achieve numerous end users.
1
CHAPTER – VII
BIBLIOGRAPHY
!
BIBLIO8RAPHY
1B C.3. ;othari% research methodology 9ew Delhi% wisva prakasan% 10% second edition !B 8. 9. *aheswari. &inancial management 9ew Delhi !000 third edition
Jour$%&s Reports
1. 34'C5 6ank annual reports% 9on !002 !. bank audit report #. previous project reports
WEBSITE /rep+o%$/+o! /t$se%$/+o! /p%$#"%$%$/+o! /'"$%$+e/"$#"%!%rt/+o! /*oo*&e/+o!
#
