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Vysya Bank
Banking Assignment
Submitted To:
Submitted By:
8 CRM Activities 10
9 Technological Innovation 11
In this type of banks, the majority of share capital is held by private individuals
and corporate. Not all private sector banks were nationalized in in 1969, and 1980. The
private banks which were not nationalized are collectively known as the old private
sector banks and include banks such as The Jammu and Kashmir Bank Ltd., Lord
Krishna Bank Ltd etc.5 Entry of private sector banks was however prohibited during the
post-nationalization period. In July 1993, as part of the banking reform process and as a
measure to induce competition in the banking sector, RBI permitted the private sector to
enter into the banking system. This resulted in the creation of a new set of private sector
banks, which are collectively known as the new private sector banks. As at end March,
2009 there were 7 new private sector banks and 15 old private sector banks operating in
India.
Bank Origin:
Commercial banking in India can boast of a history of about 200 years. Though one
could trace the history of banking back to the 19th century, the beginning of the last
century saw the birth of many banks in India, set up by people with vision, commitment
and national spirit.
Evolution
The Karur Vysya Bank Limited, popularly known as KVB, one such endeavour, was
set up in 1916 by two great visionaries and illustrious sons of Karur, the Late Shri M A
Venkatarama Chettiar and the Late Shri Athi Krishna Chettiar to inculcate the habit of
savings and provide financial assistance to traders and small agriculturists in and around
Karur, a textile town in Tamil Nadu.
Though the bank started with a seed capital of Rs.1 lakh, it has withstood
innumerable changes and challenges in the past few decades and has profitably emerged
as one of the leading banks in India without compromising on its fundamentals.
Shedding its inherent regional flavour, the bank has now spread its wings far and
wide with over 320 branches in 13 States and 3 Union Territories in order to gain a pan
India presence. The bank has been conducting its affairs meticulously to conform to all
the prudential norms and exacting statutory regulations.
VISION
MISSION
Recognition:
• Ranked as the Best Mid-sized Bank by Business Today – KPMG for 2009
• Was rated as the Most Efficient Small Bank by Business Today – KPMG and as
the No. 1 old private sector bank by Financial Express – Ernst & Young for two
years in succession (2006 & 2007)
• Ranked by The Banker, London among the TOP 100 Banks of the world for the
year 2009 (One among 32 Indian Banks featuring in the list). Also one of only 6
Indian Banks featured in the list of top performers under Return on Assets
• Awarded the "Banking Technology Excellence Awards - 2008" for Best use of IT
for Customer Service in Semi-Urban and Rural Areas and the "Banking
Technology Excellence Awards - 2009" - Special Award – Best IT Infrastructure
Technological accomplishments:
KVB is one of the earliest banks in the country to achieve full networking of its
branches under Core Banking Solutions, offering services through multiple delivery
channels. Some of the noteworthy accomplishments of KVB are:
• Total business of the bank was at Rs. 32946.85 cr. with total deposits at Rs.
19271.85 cr. and total advances at Rs. 13675 cr. as on 31.03.2010. KVB is the
first Tamilnadu based private sector bank to cross the milestone figure of Rs.
30000 cr. total business.
• The net profit of the bank for the year was Rs. 336.03 cr.
• The net owned funds of the bank are Rs. 1619.98 cr.
• The bank has a Capital Adequacy Raito of 14.49% (Basel II) as against the RBI
stipulated norm of 9%.
• The bank has one of the lowest net NPA ratios in the country @ 0.23%.
• The bank has been earning profits since inception and has been declaring
dividend uninterruptedly.
• The bank has declared 100% dividend since 2003-04. For 2005-06, 2007-08,
2008-09 and 2009-10, the dividend was 120%
For Personal
Mutual Funds:
The entire range of schemes of the following AMCs are available at KVB's counters:
For Corporate
Current Account
Features
For NRI
The following type of NRI Accounts are offered by Karur Vysya bank
Green trac
Technological Innovation
KVB has been using its ATMs to deliver multiple services beyond mere cash
dispensing. Card to card / card to account transfer of funds and payment for air tickets of
Kingfisher are other services made available through ATMs. The bank has a branch
network of 335 and an ATM network of 376. The bank plans to add another 50 branches
by the end of the financial year 2010 -11
Internet banking is available to all individuals, including both resident and non-
resident Indians and Hindu Undivided Families as well as to Partnership firms and
Corporates. You can perform all your routine banking activities online conveniently and
comfortably from wherever you are. KVB’s Internet Banking is available with the
security of Double Factor Authentication, which is a combination of a 4 digit PIN and a
random number generated by an RSA token.
The customer can make both financial and non-financial transactions through our
Internet Banking Service. For joint accounts, the primary account holder alone can make
financial transactions, provided all the account holders authorize the primary account
holder to do so. While a TPIN will be provided to individuals to carry out financial
transactions, they can avail of a crypto token, if they so desire.
KVB has entered into an arrangement with Billdesk and CCAvenue, two leading
agencies that provide a bill payment facility. Both Billdesk and CCAvenue are tied up
with over 3000 merchant establishments.
• Telephone bills
• Electricity bills
• Insurance premium
Report on Karur Vysya Bank Page 10
• Mutual fund investments
Mobile Alerts:
The customer mobile phone can be used to receive intimations via SMS for balance
enquiries, transaction enquiries, cheque status enquiries etc. This is possible with mobile
alerts, which can be received through most of the service providers, for both GSM and
CDMA enabled handsets.
E-Commerce / VBV
With the e-commerce service the customer can now make transactions over the
Internet with added security. With the growing emphasis on security for online
transactions, people are looking for the safest and most secure online payment channel.
The bank recognized this need and have enabled an additional security mechanism
called Verified by Visa (VbyV) to prevent fraud in e-commerce transactions over the
Internet. The customer just needs to enter the VbV password in addition to their CVV
and card no. to confirm their credibility when they make online transaction payments. It
is to ensure that transactions and as secure as possible and the card is not being misused.
Real Time Gross Settlement (RTGS) is a network technology payment system. The
transfer of funds by this mechanism happens instantaneously.
Through RTGS, the credit to the beneficiary/payee is given within a few hours. There
is no limit to geographical boundaries or clearing houses
CRM Activities:
KVB has initiated several customer friendly services by harnessing technology for
banking operations and provides these services at an “affordable price”. Having migrated
The bank is governed by a set of policies guidelines for the various services in order
to ensure complete transparency in its operations. Customers can refer to the relevant
policy to understand the bank’s guiding principle on such services.
This is a voluntary Code, which sets standards of fair banking practices for member’s
banks of Indian Banks’ Association to follow when they are dealing with individual
customers. It provides valuable guidance to the branches in their day to day operations.
The Code applies to:
• Branches have to act fairly and reasonably in all their dealings with the
customers.
• Branches have to help the customers to understand how our financial products
and services work by giving information about them in English/local language.
• Branches have to deal quickly and sympathetically in handling the customer
complaints.
• Branches have to help the customers to choose products and services which meet
their needs.
• Branches have to give clear information explaining the key features of the
services and products
• Branches have to tell the customer what information we need from him to prove
his identity and address to comply with legal and regulatory requirements (i.e. KYC
Norms)
• Branches have to inform the customers to count notes and ensure correctness
before leaving the cash counter.
A snapshot of the Bank’s performance under various parameters for the past three
financial years is as follows:
(Rs. In crores)
Particulars 2008-09 2009-10
Operating Profit 418.02 463.22
Net Profit 235.83 336.03
Interest Expense 1035.68 1193.05
Interest Income 1446.09 1757.94
Interest Spread 5.34 4.81
Interest Income / Total Funds 10.31 10.15
Return on Assets 250.26 297.60
Credit Deposit Ratio 71.72 67.87
Capital Adequacy Ratio 13.08 12.48
[Basel-1]
Capital Adequacy Ratio 14.92 14.92
[Basel-2]
Operating Expense/Total 1.53 1.76
funds
Financial Perfomance:
The Operating profit of the bank for the year ended 31st march 2010 stood at
Rs.463.22 cr.Compared to Rs.418.02 cr. As at 31st march 2009 registering a growth
of 10.81%.
The net profit of thebank grew by 42.48% to Rs. 336.03 cr. During the year
2009-10 from the Rs.235.84 reported I n the previous Fiscal. The total income
increased by 17.16 % to Rs. 2009.92 Cr. During the year 2009-10 compared to
Rs.1711.30 Cr. During the year 2008-09.
Report on Karur Vysya Bank Page 13
The interest income for the year 2009-10 improved by 21.57%.
The Earning per share of the bank improved by Rs.62.23 as on 31st nmarch from
43.71 as on 31st march 2009.
The Certificate of Deposit Programme of the bank for INR20 billion are rated
“P1+” by the Credit rating Agency CRISIL for INR 10 billion and another INR 10
billion by ICRA which has assigned the rating “A1+”.
Bibliography
www.kvb.co.in
www.moneycontrol.com
www.rupeetimes.com