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Management & Organisation (http://www.idbi.com/aboutus_management.asp) IDBI Bank is a Board-managed organisation. The responsibility for the day-to-day management of operations of the Bank is vested with the Chairman & Managing Director and Deputy Managing Director, who draw upon the support and expertise of a cross-disciplinary Top Management Team. IDBI Bank Ltd.'s employee base includes professionals from the fields of accountancy, management, engineering, law, computer technology, banking and economics. Board of Directors (position as on April 25, 2012) Mr. R. M. Malla (Chairman & Managing Director) Mr. B. K Batra (Deputy Managing Director)

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Page 1: Study of Financial Services and Financial Management of IDBI Bank

Management &

Organisation (http://www.idbi.com/aboutus_management.asp)

 IDBI Bank is a Board-managed organisation. The responsibility for the day-to-day

management of operations of the Bank is vested with the Chairman & Managing

Director and Deputy Managing Director, who draw upon the support and expertise of

a cross-disciplinary Top Management Team. IDBI Bank Ltd.'s employee base includes

professionals from the fields of accountancy, management, engineering, law,

computer technology, banking and economics.

Board of Directors (position as on April 25, 2012)

     

Mr. R. M. Malla (Chairman & Managing Director)

     

Mr. B. K Batra (Deputy Managing Director)

     

Mr. Sunil Soni   Mr. Pradeep Kumar

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Chaudhery

   

Mr. Subhash Tuli   Dr. B.S. Bisht

   

Mr. P.S. Shenoy

 

 

 

 

 

Home > IDBI Bank Ltd Profile     

 Profile of the Bank  

 IDBI Bank Ltd. is today one of India's largest commercial Banks. For over 40 years, IDBI Bank has essayed a key nation-building role, first as the apex Development Financial Institution (DFI) (July 1, 1964 to September 30, 2004) in the realm of industry and thereafter as a full-service commercial Bank (October 1, 2004 onwards). As a DFI, the erstwhile IDBI stretched its canvas beyond mere project financing to cover an array of services that

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contributed towards balanced geographical spread of industries, development of identified backward areas, emergence of a new spirit of enterprise and evolution of a deep and vibrant capital market. On October 1, 2004, the erstwhile IDBI converted into a Banking company (as Industrial Development Bank of India Limited) to undertake the entire gamut of Banking activities while continuing to play its secular DFI role. Post the mergers of the erstwhile IDBI Bank with its parent company (IDBI Ltd.) on April 2, 2005 (appointed date: October 1, 2004) and the subsequent merger of the erstwhile United Western Bank Ltd. with IDBI Bank on October 3, 2006, the tech-savvy, new generation Bank with majority Government shareholding today touches the lives of millions of Indians through an array of corporate, retail, SME and Agri products and services.

Headquartered in Mumbai, IDBI Bank today rides on the back of a robust business strategy, a highly competent and dedicated workforce and a state-of-the-art information technology platform, to structure and deliver personalised and innovative Banking services and customised financial solutions to its clients across various delivery channels.

As on March 31, 2012, IDBI Bank has a balance sheet of Rs.2.91 lakh crore and business size (deposits plus advances) of Rs.3.92 lakh crore. As an Universal Bank, IDBI Bank, besides its core banking and project finance domain, has an established presence in associated financial sector businesses like Capital Market, Investment Banking and Mutual Fund Business. Going forward, IDBI Bank is strongly committed to work towards emerging as the 'Bank of choice' and 'the most valued financial conglomerate', besides generating wealth and value to all its stakeholders.

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BRANCHES AND ATM NETWORKS

Information on the Constitution of IDBI(history)

Industrial Development Bank of IndiaIndustrial Development bank of India (IDBI) was constituted under Industrial Development bank of India Act, 1964 as a Development Financial Institution and came into being as on July 01, 1964 vide GoI notification dated June 22, 1964. It was regarded as a Public Financial Institution in terms of the provisions of Section 4A of the Companies Act, 1956. It continued to serve as a DFI for 40 years till the year 2004 when it was transformed into a Bank.

Industrial Development Bank of India LimitedIn response to the felt need and on commercial prudence, it was decided to transform IDBI into a Bank. For the purpose, Industrial Development bank (transfer of undertaking and Repeal) Act, 2003 [Repeal Act] was passed repealing the Industrial Development Bank of India Act, 1964. In terms of the provisions of the Repeal Act, a new company under the name of Industrial Development Bank of India Limited (IDBI Ltd.) was incorporated as a Govt. Company under the Companies Act, 1956 on September 27, 2004. Thereafter, the undertaking of IDBI was transferred to and vested in IDBI Ltd. with effect from the effective date of October 01, 2004. In terms of the provisions of the Repeal Act, IDBI Ltd. has been functioning as a Bank in addition to its earlier role of a Financial Institution.

Merger of IDBI bank Ltd. with IDBI Ltd. Towards achieving the faster inorganic growth of the Bank, IDBI Bank Ltd., a wholly owned subsidiary of IDBI Ltd. was amalgamated with IDBI Ltd. in terms of the provisions of Section 44A of the Banking Regulation Act, 1949 providing for voluntary amalgamation of two banking companies. The merger became effective from April 02, 2005.

Merger of United Western bank with IDBI Ltd. The United Western bank Ltd. (UWB), a Satara based private sector bank was placed under moratorium by RBI. Upon IDBI Ltd. showing interest to take

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over the said bank towards its further inorganic growth, RBI and Govt. of India amalgamated UWB with IDBI Ltd. in terms of the provisions of Section 45 of the Banking Regulation Act, 1949. The merger came into effect on October 03, 2006.

Change of name of IDBI Ltd. to IDBI Bank Ltd.In order that the name of the Bank truly reflects the functions it is carrying on, the name of the Bank was changed to IDBI Bank Limited and the new name became effective from May 07, 2008 upon issue of the Fresh Certificate of Incorporation by Registrar of Companies, Maharashtra. The Bank has been accordingly functioning in its present name of IDBI Bank Limited.

General Code of Conduct and Ethics (COCE) for IDBI Bank Ltd, Directors, Officers and Employees

Preamble: IDBI Bank Ltd. is committed to creating long term economic value for all its stakeholders, including shareholders, depositors, customers, employees and the society as a whole. IDBI Bank Ltd. is committed to maintaining high standards of ethical and professional conduct in all its corporate activities.

This Code of Conduct and Ethics outlines the overall standards that shall guide the actions of IDBI Bank Ltd. and its Directors, officers and employees.

1. National Interest: IDBI Bank Ltd. shall continue to be committed in all its actions to benefit the economic development of the nation and shall not engage in any activity that would adversely affect such objective.

2. Financial Reporting and Records: IDBI Bank Ltd. shall continue to prepare and maintain its accounts fairly and accurately in accordance with

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the accounting and financial reporting standards which represent the generally accepted guidelines, principles, standards, laws and regulations of the country. Internal accounting and audit procedures shall fairly and accurately reflect all of IDBI Bank Ltd. business transactions and disposition of assets.

3. Corporate Disclosure Practices: IDBI Bank Ltd. shall continue to abide by the corporate disclosure practices as specified by the appropriate external regulatory authorities.

4. Competition: IDBI Bank Ltd. shall market its products and services on its own merits.

5. Equal-Rights: IDBI Bank Ltd shall continue to provide equal opportunities to all its employees and all qualified applicants for employment without regard to their race, caste, religion, colour, ancestry, marital status, sex, age, nationality, disability etc. Applicable laws, rules, and guidelines of Government of India / any other Competent Authority in this regard shall also be observed for this purpose. Employees of IDBI Bank Ltd. shall be treated with dignity and in accordance with the IDBI Bank Ltd. policy to maintain a work environment free of sexual harassment, whether physical, verbal or psychological. Employee policies and practices shall be administered on a non-discriminatory basis in all matters relating to recruitment, training, compensation, benefits, promotion, transfers and all others terms and conditions of employment.

6. Prohibited Business: IDBI Bank Ltd. shall not enter into any kind of business with any company / organisation / entity, of which any of its director of is a proprietor, partner, director, a manager, employee or guarantor or in which one or more directors of IDBI Bank Ltd. together hold substantial interest.

Substantial interest, in relation to any company / organisation / entity, means any beneficial interest held by one or more of the directors of IDBI Bank Ltd. or by any relative of such director, whether singly or taken

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together, in the shares of the company / organisation / entity, the aggregate amount paid up on which either exceeds five lakh of rupees or 5% of its paid-up share capital, whichever is lesser.

7. Quality of Products and Services: IDBI Bank Ltd. shall continue to be committed to creating new industry standards of excellence in customer service. IDBI Bank Ltd. shall provide innovative and superior quality customer service consistent with the requirements of the customers for their satisfaction.

8. Corporate Opportunity: A Director / Officer / Employee must not deprive IDBI Bank Ltd. of an opportunity that belongs to IDBI Bank Ltd., for his/ her own/other's advantage, if he / she is in a position of diverting the corporate opportunity for own benefit or to others to the detriment of IDBI Bank Ltd. A Director / Officer / Employee must not compete with IDBI Bank Ltd. in respect of any business transaction.

9. Health, Safety and Environment: IDBI Bank Ltd. shall strive to provide a safe and healthy working environment at its work places and comply, in the conduct of its business affairs, with all regulations regarding the preservation of the environment of the territories it operates in.

10. Corporate Social Responsibility: IDBI Bank Ltd. shall continue to be committed to be a good corporate citizen not only in compliance with all relevant regulating laws and regulations but also by actively assisting in the improvement of the quality of life of the people in the communities in which it operates with the objective of making them self reliant.

11. Public Representation of the Company & the Group: IDBI Bank Ltd. honours the information requirements of the public and its stakeholders. All its external communication will be only by officials / directors authorised for the purpose.

The information for the public constituents and

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stakeholders, duly approved by the Compliance Officer or other authorised official, as the case may be, shall be disseminated through any of the following media:

- The accredited newspaper publications;

- Web casting on the official web site;

- Press handouts and press releases;

- Audio and audio-visuals prepared for the specific purpose.

12. Use of IDBI Bank Ltd. Name Logo/ Trademarks: A Director / Officer / Employee shall not use the name of IDBI Bank Ltd., its logo or trademark for personal benefit or for the benefit of persons / entities not forming part of the IDBI Group.

13. Shareholders: IDBI Bank Ltd. is committed to enhance shareholder value and shall comply with all regulations and laws that govern shareholders' rights. The Board of Directors' of IDBI Bank Ltd. shall duly and fairly inform its shareholders about all relevant aspects of the organisation business and disclose such information in accordance with the respective regulations and agreements. Every employee shall also be responsible for implementation of and compliance with this code.

14. Ethical Standards: A Director / Officer / Employee of IDBI Bank Ltd. shall conduct all the dealings on behalf of IDBI Bank Ltd. with professionalism, honesty, integrity and high moral and ethical standards. Every Director / Officer / Employee of IDBI Bank Ltd. shall be responsible for the implementation of and compliance with the Code in his / her professional environment, be fair and take action not to discriminate, honour confidentiality and strive to achieve more specific professional responsibilities.

15. Insider Trading: Insider Trading involves the improper use of non - public price sensitive information when dealing in securities. Specified employees are prohibited from

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engaging in insider trading as detailed in the Code of Conduct for Prevention of Insider Trading.

16. Conduct of Staff: To uphold the image and dignity of the institution, it is desirable that every director / officer / employee of IDBI Bank Ltd. should demonstrate a high degree of conduct and integrity, as under:

a. a sense of fair play, impartiality and promptness in disposing of cases and show courtesy and consideration in public dealings;

b. keeping in mind the objective of IDBI Bank Ltd., to contribute his / her mite through integrity, dedication and competence;

c. restrain from participating or assisting in any activity, which is detrimental to the interest of IDBI Bank Ltd. or is in competition to the interest of IDBI Bank Ltd.;

d. not use or influence by virtue of the position held in the bank for obtaining favours ofany kind for himself / herself or any members of family or friends or equivalent person with any constituent / borrower / client / customer;

e. be cost conscious and plug all wastes and leakages, to remain competitive;

f. not to be negligent or show lack of devotion to duty any time and

g. not to show any favouritism or commit any irregularity in inviting tenders an awarding contracts or cultivate too much friendship with the Bank's contractors / suppliers.

17. Regulatory Compliance: A Director / officer / employee shall, in his business conduct, comply with all applicable laws and regulations.

18. Securities Transactions and Confidential Information: A Director / officer / employee of IDBI Bank Ltd. and their family members shall not derive any benefit or assist others to derive any benefit from the access to and possession of information about IDBI Bank Ltd. which is not in the public domain and thus constitutes insider information. The Director / officer / employee of IDBI Bank Ltd. shall maintain confidentiality of all price

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sensitive information. Unpublished price sensitive information would be disclosed only to those within the company who need the information to discharge their duty.

19. Conflict of Interest: The Directors / officers / employees of IDBI Bank Ltd. shall always conduct themselves in an honest and ethical manner and in the best interest of the Bank. Towards this, the directors, officers and employees of IDBI Bank Ltd. shall endeavour to avoid situations that may lead to an actual or potential conflict between person's private interest and the interest of the Bank, including its affiliates and subsidiaries. While it may be difficult to list all the situations of conflict of interest, the following are illustrative examples of some of the situations, which may constitute a Conflict of interest:

- a Director/ officer/ employee engages in any business, relationship or activity which might detrimentally conflict with the business of IDBI Bank Ltd.

- a Director / officer / employee receives improper personal benefits as a result of his official position in the Bank.

- a Director / officer / employee is in a position to make, influence or benefit from the decisions relating to the transaction.

If such and other instances of conflict of interest exist due to any historical reasons, adequate disclosures by the interested employees should be made to the management.

20. Gifts and Donations: The Director / officer / employee of IDBI Bank Ltd. shall not solicit or accept any gifts /donations of more than modest value from a constituent of IDBI Bank Ltd. or from any subordinate employee or from existing / potential clients or third parties having business dealings with IDBI Bank Ltd.

21. Gender Friendly Workplace: As a good corporate citizen, IDBI Bank Ltd. is committed to a gender friendly workplace. IDBI Bank

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Ltd. demands, demonstrates and promotes professional behaviour and respectful treatment of all employees.

22. Prohibition against participation in politics and standing for election: No employee shall take an active part in politics or in any political demonstration, or stand for election as member of a Municipal Council, district Board or any other Local Body or any Legislative Body.

23. Protection of Bank's assets: The assets of IDBI Bank Ltd. shall not be misused but employed for conducting the business for which they are duly authorised.

24. Ethics and Compliance Committee: The Ethics and Compliance Committee comprising few independent directors of the Board, an Executive Director, Chief Vigilance Officer of IDBI Bank Ltd. and the Compliance Officer and any other officer so nominated, will oversee the compliance of the Code of Conduct and Ethics.

Corporate Governance

 

   

IDBI upholds the highest standards of corporate governance in its operations. The responsibility for maintaining these high standards of governance lies with its Board of Directors. Two Committees of the Board viz. the Executive Committee and the Audit Committee are adequately empowered to monitor implementation of good corporate governance practices and making necessary disclosures within the framework of legal provisions and banking conventions.

 

   

Vigilance Department in IDBI Bank

A full-fledged Vigilance Department operates at the Bank's Head Office. The Department operates as a channel for providing inputs to the Top Management for carrying out investigation into vigilance related complaints

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and to suggest corrective measures for improving the control systems and compliance of laid down procedures.

Implementation of Guidelines of the Central Vigilance Commission (CVC)The Department has been implementing the guidelines laid down by the CVC from time to time for improving Vigilance Administration and has put in place a system wherein complaints received, from the public / any other sources, are attended to promptly.

 

   

      

 IDBI Bank is a pioneer Institution in Nation building. To cater to its ever-expanding needs, IDBI Bank has formed subsidiaries & joint ventures across diverse areas of Banking & Financial System.

 

      

      

 IDBI Capital Market Services Limited (ICMS)    

     

 

ICMS, a wholly owned subsidiary of IDBI Bank, started as a Broking and Distribution company in 1993. Currently its businesses include Merchant Banking, Stock Broking, Distribution of Financial Products, Corporate Advisory Services, Debt Arranging & Undertaking, Portfolio Management of Pension / PF Funds & Research services.

Invest online – Equities, MF & IPOs - www.idbipaisabuilder.in

 

   

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Capital Markets

 

IDBI Capital as an institutional player provides the entire gamut of Capital Market services encompassing:

1. Public Offerings2. Qualified Institutional Placements3. Buyback4. Takeover5. Preferential Allotments6. External Commercial Borrowings, FCCBs, etc.

The above activities entails liasioning with institutional investors such as treasury departments of Domestic Institutions, Banks and corporates, fund managers of mutual funds, private equity firms, FIIs, HNIs.

Investment Banking

 Our Clients

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We represent Government organizations, Public Sector Enterprises and Indian Corporates covering sectors such as Steel and other metals, Mines, Minerals, Chemicals, Healthcare, Hospitality, Financial Services and other Core Sectors.

Our Team

We have a combination of professionals with varied background who shares our values of truthfulness, objectivity, innovation and analytical accuracy. The professional qualification of our team provide a rock solid foundation for giving consulting services and our depth of experience ranges from young management graduates from premier business schools to experienced finance professional and qualified chartered accountants as well.

Institutional Broking & Distribution

 

Institutions and Corporates have surplus funds to manage on daily basis as well as investible surplus for a defined period. The risk differs for Institution and Corporates subject to their preferences. The reward by way of return is always in proportion to the risk taken. IDBI Capital define, advise and manage the same by blending caution with aggression in the desired proportion to teach client. The range of services include from Equity Broking with customised research, advisory and distribution services for investment in Mutual Funds, Debt/Bonds, Equity IPOs to placement of Equities etc

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Retail Broking & Distribution

In addition to offering corporate, institutional clients, IDBI Capital also offers a gamut of financial products and services that cater to a varied cross section of investors. IDBI Capital also offers to financial planners, retail intermediaries and consumers to deliver lasting, innovative solutions.

Looking at the opportunities in our market and the growth of our country, we believe it is high time investors are educated about the nuances of investments. The knowledge and awareness gained will empower investors and help them create wealth. We firmly believe brokers, media and regulators have a pivotal role in assisting the individuals to become wealthy. We will go extra mile to empower the investors in managing their wealth to ensure a more rewarding future.

IDBI Capital aims to provide a single-point source for retail investors in their requirements for trading and investment products.

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Fund Management

IDBI Capital Market Services Ltd. (ICMS) is a leading Fund Manager in the country for Provident, Pension and Retirement Benefit Funds. The Company is a SEBI registered Portfolio Manager and manage its Client’s assets under both discretionary and non-discretionary mandates. These services are provided to various public and private sector undertakings and their provident, pension, retirement benefit and surplus funds. The Company’s client base includes leading pension and provident funds in the country.

IDBI capital has been advising institutions, banks and corporates for their investment in Debt, Mutual Funds and Equities over several years. Its services include managing Client Assets--Pension & Provident Funds, Surplus fund Management, Equity Portfolio Management and Mutual Fund Advisory.

The funds have continuously yielded superior returns, which are significantly higher than the benchmark.

Audit Systems: Audit of all transactions and reports by an independent firm of chartered

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accountants. The accounts and transactions are also subject to CAG audit and other regulators

Belongs to IDBI Group: IDBI is a leading bank, classified under ‘Other Public Sector Bank’. Established in 1964 by Government of India under an Act of Parliament, IDBI has essayed a significant role in the country’s industrial and economic progress for over 40 years – first as apex Development Financial Institution (DFI) and now as a full ISO Certification 9001:2000Keeping in view the importance of standardized processes and service levels, the Company has gone in for ISO Certification for Fund Management, and is the only company to have done so in this sector. Being a public sector, the Company is also audited by Comptroller and Auditor General (CAG) office and follows transparent practices.

Regulatory ApprovalIDBI Capital is a registered Portfolio Manager with Securities and Exchange Board of India (SEBI) since 1998 and is authorised to undertake Funds Management activities (Debt & Equity) for clients. These activities would be governed by Securities and Exchange Board of India (Portfolio Managers) Rules and Regulations, 1993. SEBI Regisration No. of IDBI Capital is INP000000209, valid till the year 2010.

The Key strengths of IDBI capital Market Services in the areas of Debt Fund Management are:

1. Fund Management experience of 10 years2. Expertise in managing large corpus3. Expertise in both Debt & Equity Market4. IDBI Capital is the only Portfolio Manager in

the Country to achieve ISO 9001: 2000 Standard for Quality Management Systems in Fund Management operations, with certification from TUV NORD an accredited German standards firm

5. Substantial Returns Over Benchmark6. IDBI Capital is a SEBI registered Portfolio

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Manager7. Minimum Idle Days8. Our fund management skill covers Portfolio

Analysis that includes ALM, Asset Allocation, Risk Analysis, Maturity Analysis and Yield Analysis

9. Transparency of Operations10. Strict adherence to Compliance

Procedures11. Highly Rated Debt Research12. Presence in All Segment/ Asset of the

Financial Services: IDBI Capital deals in Equity and Equity related products and is one of the highly rated Mutual Fund Distributor (won two consecutive CNBC TV18 Institutional Financial Advisor Award). In Investment Banking and Debt Capital Market- Rated in Top 15 by Prime Database

13. Group Strength in Debt Market: IDBI Capital is one of the leading players in debt market with presence in primary dealership since July 2007. The current operations of primary dealership is conducted by a group company, IDBI Gilts

Infrastructure

Experienced Fund Management Team : The Fund Management team comprises of experienced professionals (experience ranges between 2 years to 15 years) in Portfolio Management with requisite exposure in the fixed income and equity segment and qualifications

Experienced Back-Office : The Clearing and Settlement Operations are manned by experienced personnel with requisite exposure to capital market and particularly debt market. The process is standardized as per the regulatory and other specific norms and mainly technology driven in most areas

Accounting : Real time accounting of Remittances, Investments, Interest and Redemption proceeds ensures accurate reconciliation

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Professional Custodian: Member of NSDL for demat services and offers Constituent SGL Account facility for Government securities through IDBI Gilts Ltd.

Functional Separation of Front and Back Office: Separate personnel handle the front and back office functions to ensure transparency and complete regulatory compliance

Internal Controls : Adequate Risk Management systems in place to ensure complete regulatory compliance

service commercial bank

      

 IDBI Intech Limited (IIL)    

     

 

IIL was incorporated in March 2000, as a wholly owned subsidiary of IDBI Bank to undertake the IT related activities of the Bank. The major business activities of the company are Information Technology Services, Information Security Practices, National Contact Center and Outbound Sales Team .

 

      

 IDBI Asset Management Limited (IAML)    

     

 IAML, a subsidiary of IDBI Bank, is providing asset management services to IDBI Mutual Fund. IAML was incorporated on January 25, 2010 as a wholly owned subsidiary of IDBI Bank. Subsequently, IDBI Capital Market Services Ltd. (ICMS), a wholly owned subsidiary of IDBI Bank, has acquired 33.33% equity stake in IAML and remaining 66.67% equity is with IDBI Bank. The company is currently managing nine schemes launched by IDBI Mutual Fund i.e. two equity schemes

 

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(IDBI Nifty Index Fund and IDBI Nifty Junior Index Fund), six debt schemes (IDBI Liquid Fund, IDBI Ultra Short Term Fund, IDBI Short Term Bond Fund, IDBI Monthly Income Plan, IDBI Fixed Maturity Plan and IDBI Dynamic Bond Fund) and one gold scheme (IDBI Gold ETF).

      

 IDBI MF Trustee Company Limited (IMTCL)    

     

 

IMTCL, a wholly owned subsidiary of IDBI Bank, was incorporated on January 25, 2010. The company acts as the Trustee of IDBI Mutual Fund. As per SEBI Mutual Fund Regulation 1996, the Trustees ensure that all the activities of the Mutual Fund are carried out within the regulatory frame work.

 

      

 IDBI Trusteeship Services Ltd (ITSL)    

     

 

ITSL was incorporated on March 8, 2001 for carrying out trusteeship and other related business. Consequent to acquisition of additional 14.92% shares of ITSL on October 01, 2011, IDBI Bank’s shareholding in ITSL increased from 39.78% to 54.70% and it has became a subsidiary of IDBI Bank. The company’s present operations include, acting as trustees to securitization transactions, acting as Bond/Debenture trustee, Security trusteeship assignments, Share pledge Trustee, Venture Capital Fund, Safe Keeping, Escrow Agency and other trusteeship services.

 

    

 IDBI Federal Life Insurance Company Limited (IDBI Federal)

   

     

 IDBI Federal is a Joint Venture Life Insurance Company of IDBI Bank Ltd., The Federal Bank Ltd. and Ageas Insurance International (Ageas). IDBI Federal commenced operations in March 2008. IDBI Bank holds 48% equity shares in IDBI Federal whereas Federal Bank Ltd. and Ageas hold 26% equity shares each. The

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Company’s life insurance business comprises individual life and pension and group life, including non-participating, health and linked segments. IDBI Federal has Bancassurance partnership with IDBI Bank and the Federal Bank and also distributes its products through its own network. To further diversify its distribution base, it has set up an Alternate & Direct Distribution channel.

RATINGSIDBI Bank obtains credit ratings for both domestic and foreign currency borrowings. The ratings for the rupee

resources are as under :

Ratings for Rupee Borrowings

CRISIL ICRA Fitch

Fixed Deposit FAAA/Stable MAA+ Fitch tAAA(ind)

Short Term Borrowings

(Certificate of Deposits)

CRISIL A1+ [ICRA]A1+ Fitch A1+(Ind)

Long Term Rupee Bonds (Senior & Lower

Tier II bonds)

CRISIL AA+/ Stable [ICRA]AA+/Stable Fitch AA+(Ind)

Hybrid - Upper Tier II Bonds CRISIL AA /Stable [ICRA]AA/Stable Fitch AA–(Ind)

Hybrid – IPDI CRISIL AA/Stable [ICRA]AA/Stable ----

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The Foreign Currency borrowings of the bank are rated by International Rating Agencies viz., Standard & Poor's

(S&P) and Moody's Investor Services (Moody's). The long term Foreign Currency Ratings and Bank Financial Strength

Ratings (BFSR) are as under:

Ratings for Foreign Currency Borrowings

Rating Agency Long term rating BFSR

Moody's Investor Services (Moody's) Baa3 D -

Standard & Poor's (S&P) BBB - /Stable C

Services

http://www.idbi.com/icg_services.asp

 Services rendered by IDBI Bank under Corporate Banking cover debt syndication and specialized advisory services to the corporate in the infrastructure and allied sectors. The Bank offers Project Appraisal, Debt Syndication, Corporate advisory services and Securitization & Structured products as specialized services.

(A) Appraisal:

IDBI Bank has cutting edge capabilities in the appraisal of large projects and has over the years earned reputation in appraisal of these projects, which are well accepted in the banking industry. Project Appraisal Department has a dedicated team of qualified and experienced professionals with domain knowledge in the infrastructure and other major industry sectors, including technical, financial, legal and financial disciplines, to carry out appraisal of large infrastructure and non-infrastructure projects.

IDBI Bank’s appraisals have been used by the corporates, besides availing loan facilities for implementing projects, to finalise their decisions in bidding for new projects, assets acquisition, business plans or disinvestments decisions. PAD has offered these services to PSU majors like Indian Oil, SAIL, ONGC, HPCL, NALCO, NTPC and leading Industrial Groups such as GMR Industries, Tata Group and Aditya Birla Group for their various projects.

(B) Debt Syndication:

Over the last five years, the Bank has been offering its debt syndication services to corporates by arranging financial assistance (both term loan

 

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and Working Capital) to their projects and operations. The hallmark of IDBI Bank’s Syndication process is that IDBI Bank takes the role of lead bank for debts arranged by it, by financing major share of debt in the debt programme. Such a decision always has a positive impact in arranging of loans. The Bank also syndicates FC loans for ECB requirement of corporate clients.

The Syndication, Structuring and Advisory Department, (SSAD) has a good complement of qualified and experienced team of professionals who are taking care of the clients’ needs. The team has been dealing transparently and takes a balanced view on the risk perceptions of the project. Reckoning clients’ special needs, tailor made solutions are being provided promptly.

IDBI Bank is rated among top three INR debt arrangers for the year 2011 with market share of 8.2%.

Since its inception, the syndication team has concluded more than 90 deals with aggregate debt amount of nearly Rs.1.9 lakh crore. Major Industrial houses such as Reliance, Aditya Birla, ESSAR, Vedanta, TATA, Adani, Bharati, Jaypee, have reposed their faith in IDBI Bank’s capability to arrange debt for their projects.

IDBI Bank has emerged as a leading player in debt syndication field and has excellent business relationship with all the public & private banks and Financial Institutions. The project related Information Memorandums (IM) prepared by the SSAD team are well received by the participating bankers and FIs. Over the years, the Bank has developed a good rapport with almost all banks and FIs in convincing them about the strengths of the projects syndicated by it. Team SSAD has officers who have specialized the documentation requirements of the clients, who ensure that terms of assistance and covenants of all lenders are aligned.

(C) Advisory Services:

Corporate Advisory: The strong domain knowledge in infrastructure and allied sectors has provided IDBI Bank a niche in offering the advisory services for the corporate in the infrastructure sector. The range of advisory services offered by IDBI Bank include merchant appraisal of projects, acquisition / sale of assets, business valuation and pre bid advisory for PPP projects in Road sector. IDBI has been permitted by the SEBI to act as the agent for the IPO monitoring of corporate which come out with public issue of equity shares of issue size higher than Rs.500 crore.

(D) Environmental Services:

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IDBI Bank has undertaken the pioneering role in the Indian banking sector in the area of environmental banking and has been active in this field for over 20 years.

IDBI Bank has created an exclusive group working on climate change and more specifically on carbon credits advisory services to the clients to deal with Clean Development Mechanism (CDM) / Carbon Credits of Kyoto Protocol and Voluntary Emission Reductions (VERs) authorities.

This group has devised a structured product for providing upfront finance against the carbon credit receivables. The product is well accepted by the Indian project developers.

IDBI Bank is presently implementing Ozone Depleting Substances (ODS) phase-out projects and the India Chiller Energy Efficiency Project (ICEEP) in association with World Bank and Govt. of India. The carbon credit group is closely associated with the World Bank in providing an End–To–End solution for the chiller users of India in switching over from a high carbon chiller to energy efficient low carbon chiller. IDBI Bank also publishes a monthly newsletter called "IDBI Carbon Developments". The magazine covers the analysis of the pricing of Certified Emission Reductions (CERs) on spot and futures, status of CDM project registration and various other developments happening in the carbon market, Renewable Energy Certificate (REC) trading and Perform Achieve and Trade (PAT) mechanism launched by the Govt. of India

Cash Management ServicesThe fundamental objective of Cash Management Services (CMS) is "optimization of liquidity through an improved flow of funds". In today's highly competitive environment, where time is considered as money, deployment of staff to render basic routine tasks does not make economic sense. As a sequel, cash management today is not what it used to be. Electronic banking, which began as a passive desktop access to bank balances, is emerging into complex processes of liquidity management through numerous techniques.

CMS is one of our thrust areas, which offers innovative and reliable solutions by combining an efficient collections and disbursements product, backed by state of the art systems to ensure customized delivery. The objectives are to reduce costs, enhance control and optimise returns. Our technology advantage helps us in consistently delivering superior products, convenient

 

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access channels and efficient services to our customers.

IDBI Bank’s customized Cash Management Solution, driven by our powerful software, gives our customers complete control of the fund inflows and outflows. IDBI Bank's state of the art technology, gives our customers, the freedom to concentrate on profitability.

IDBI Bank http://en.wikipedia.org/wiki/IDBI_Bank

IDBI Bank Limited

Type Public (BSE: 500116)

Industry Banking, Financial services

Founded July 1964

Headquarters Mumbai, India

Key people R M Malla (CMD)

Products

Credit cards, consumer banking, corporate

banking, finance and insurance, investment

banking, mortgage loans, private banking,

private equity, wealth management

Revenue 20,858 crore (US$4.16 billion) (2011)[1]

Net income 1,563 crore (US$311.82 million) (2011)

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Total assets 253,116 crore (US$50.5 billion) (2011)

Employees 14,000 (2011)

Website www.idbi.com

IDBI Bank Limited (BSE: 500116) is an Indian financial service company headquartered Mumbai, India. RBI categorised IDBI as an "other public sector bank". It was established in 1964 by an Act of Parliament to provide credit and other facilities for the development of the fledgling Indian industry.[2] It is currently 10th largest development bank in the world in terms of reach with 1514 ATMs, 923 branches including one overseas branch at DIFC, Dubai and 621 centers including two overseas centres at Singapore & Beijing. [3] Some of the institutions built by IDBI are the Securities and Exchange Board of India (SEBI), National Stock Exchange of India (NSE), the National Securities Depository Limited (NSDL), the Stock Holding Corporation of India Limited (SHCIL), the Credit Analysis & Research Ltd, the Exim Bank (India)(Exim Bank), the Small Industries Development Bank of India(SIDBI), the Entrepreneurship Development Institute of India, and IDBI BANK, which is owned by the Indian Government.IDBI Bank is on a par with nationalized banks and the SBI Group as far as government ownership is concerned.It is one among the 26 commercial banks owned by the Government of India.The Bank has an aggregate balance sheet size of Rs. 2,53,378 crore as on March 31, 2011. IDBI Bank's operations during the financial year ended March 31,

Contents

[hide]

1 Recent developments 2 Overview of development banking in India 3 Industrial Development Bank of India (IDBI) 4 Industrial Investment Bank of India Ltd. 5 Acquisition of United Western Bank 6 See also 7 References 8 External links

[edit] Recent developments

To meet emerging challenges and to keep up with reforms in financial sector, IDBI has taken steps to reshape its role from a development finance institution to a commercial institution. With the Industrial Development Bank (Transfer of Undertaking and Repeal) Act, 2003, IDBI attained the status of a limited company viz. "Industrial Development Bank of India Limited" (IDBIL). Subsequently, the Reserve Bank of India (RBI) issued the requisite notification on 30 September 2004 incorporating IDBI as a 'scheduled bank' under the RBI Act,

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1934. Consequently, IDBI, formally entered the portals of banking business as IDBIL from 1 October 2004. The commercial banking arm, IDBI BANK, was merged into IDBI.

In March 2008, IDBI Bank entered into a joint venture with Federal Bank and Fortis Insurance International to form IDBI Fortis Life Insurance, of which IDBI Bank owns 48 percent. The company ended the year with over 300 Cr in premiums as on 31 March 2009.The name of IDBI Fortis Life Insurance is now changed to IDBI Federal Life Insurance Co Ltd.

Government of India now owns 65.17% stake in IDBI Bank. Hence IDBI Bank is also referred as 'The New Age Government owned Bank'

It has bought 10% stake in upcoming commodity bourse Universal Commo-dity Exchange (UCX) for Rs 10 crore, the bank's top official said. The deal was completed recently. RM Malla, chairman and MD of IDBI Bank, confirmed that the bank had picked up 10% in what will become the country's sixth commodity futures exchange. "The idea behind acquiring equity is to push agriculture loans through this venture," said Malla. "The other advantage is IDBI will be the only bank among the promoters and therefore all transactions of the exchange will be routed through IDBI."[4]

A breakthrough initiative in customer service was taken by IDBI Bank (branded as 'Customer Delight Campaign [1]' when it removed many of the charges from its retail banking services. This step has created a wave in banking industry and put the bank on a developmental pedestal never seen before. Some of the charges waived are- ATM-cum-Debit card annual charges, Transaction charges on other banks' ATMs, Demand Draft/Pay Order charges, RTGS/NEFT charges, Cheque book issuance and utilization charges and many more other charges.

It was the winner in two categories in Dun & Bradstreet's Polaris Software Banking Awards 2011.[5]

It has now a network of 977 branches, 661 centres and 1547 ATMs as on April 18, 2012. The 977th branch is located at Kagal near Kolhapur in Maharashtra.

[edit] Overview of development banking in India

The concept of development banking rose only after Second World War, after the Great Depression in 1930s. The demand for reconstruction funds for the affected nations compelled in setting up a worldwide institution for reconstruction. As a result the IBRD was set up in 1945 as a worldwide institution for development and reconstruction. This concept has been widened all over the world and resulted in setting up of large number of banks around the world which coordinating the developmental activities of different nations with different objectives among the world. The Narashimam committee had recommended to give up its direct financing functions and to perform only the promotional and refinancing role. However, the S.H.Khan committee, appointed by the RBI, recommended its transformation into a universal bank.[6]

The course of development of financial institutions and markets during the post-Independence

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period was largely guided by the process of planned development pursued in India with emphasis on mobilisation of savings and channeling investment to meet Plan priorities. At the time of Independence in 1947, India had a fairly well developed banking system. The adoption of bank dominated financial development strategy was aimed at meeting the sectoral credit needs, particularly of agriculture and industry. Towards this end, the Reserve Bank concentrated on regulating and developing mechanisms for institution building. The commercial banking network was expanded to cater to the requirements of general banking and for meeting the short-term working capital requirements of industry and agriculture. Specialised development financial institutions (DFIs) such as the IDBI, NABARD, NHB and SIDBI, etc., with majority ownership of the Reserve Bank were set up to meet the long-term financing requirements of industry and agriculture. To facilitate the growth of these institutions, a mechanism to provide concessional finance to these institutions was also put in place by the Reserve Bank.

The first development bank In India incorporated immediately after independence in 1948 under the Industrial Finance Corporation Act as a statutory corporation to pioneer institutional credit to medium and large-scale. Then after in regular intervals the government started new and different development financial institutions to attain the different objectives and helpful to five-year plans.

The early history of Indian banking and finance was marked by strong governmental regulation and control. The roots of the national system were in the State Bank of India Act of 1955, which nationalized the former Imperial Bank of India and its seven associate banks. In the early days, this national system operated alongside of a large private banking system. Banks were limited in their operational flexibility by the government’s desire to maintain employment in the banking system and were often drawn into troublesome loans in order to further the government’s social goals.

The financial institutions in India were set up under the strong control of both central and state Governments, and the Government utilized these institutions for the achievements in planning and development of the nation as a whole. Thus India financial institutions can be classified under five heads according to their economic importance:

All-India Development Banks Specialized Financial Institutions Investment Institutions State-level institutions Other institutions..

[edit] Industrial Development Bank of India (IDBI)

The Industrial Development Bank of India (IDBI) was established on 1 July 1964 under an Act of Parliament as a wholly owned subsidiary of the Reserve Bank of India. In 16 February 1976, the ownership of IDBI was transferred to the Government of India and it was made the principal financial institution for coordinating the activities of institutions engaged in financing,

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promoting and developing industry in the country. Although Government shareholding in the Bank came down below 100% following IDBI’s public issue in July 1995, the former continues to be the major shareholder (current shareholding: 65.14%). IDBI provides financial assistance, both in rupee and foreign currencies, for green-field projects as also for expansion, modernisation and diversification purposes. In the wake of financial sector reforms unveiled by the government since 1992, IDBI also provides indirect financial assistance by way of refinancing of loans extended by State-level financial institutions and banks and by way of rediscounting of bills of exchange arising out of sale of indigenous machinery on deferred payment terms.[citation needed]

IDBI has played a pioneering role, particularly in the pre-reform era (1964–91),in catalyzing broad based industrial development in the country in keeping with its Government-ordained ‘development banking’ charter.[citation needed]

Narasimam committee[7] recommends that IDBI should give up its direct financing functions and concentrate only in promotional and refinancing role. But this recommendation was rejected by the government. Later RBI constituted a committee under the chairmanship of S.H.Khan to examine the concept of development financing in the changed global challenges. This committee is the first to recommend the concept of universal banking. The committee wanted the development financial institution to diversify its activity. It recommended to harmonise the role of development financing and banking activities by getting away from the conventional distinction between commercial banking and developmental banking.

In September 2003, IDBI diversified its business domain further by acquiring the entire shareholding of Tata Finance Limited in Tata Home finance Ltd., signaling IDBI’s foray into the retail finance sector. The fully owned housing finance subsidiary has since been renamed ‘IDBI Home finance Limited’. In view of the signal changes in the operating environment, following initiation of reforms since the early 1990s, Government of India has decided to transform IDBI into a commercial bank without eschewing its secular development finance obligations. The migration to the new business model of commercial banking, with its gateway to low-cost current, savings bank deposits, would help overcome most of the limitations of the current business model of development finance while simultaneously enabling it to diversify its client/ asset base. Towards this end, the IDB (Transfer of Undertaking and Repeal) Act 2003 was passed by Parliament in December 2003. The Act provides for repeal of IDBI Act, corporatisation of IDBI (with majority Government holding; current share: 58.47%) and transformation into a commercial bank. The provisions of the Act have come into force from 2 July 2004 in terms of a Government Notification to this effect. The Notification facilitated formation, incorporation and registration of Industrial Development Bank of India Ltd. as a company under the Companies Act, 1956 and a deemed Banking Company under the Banking Regulation Act 1949 and helped in obtaining requisite regulatory and statutory clearances, including those from RBI. IDBI would commence banking business in accordance with the provisions of the new Act in addition to the business being transacted under IDBI Act, 1964 from 1 October 2004, the ‘Appointed Date’ notified by the Central Government.

IDBI Bank, with which the parent IDBI was merged, was a new generation Bank. The Pvt Bank

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was the fastest growing banking company in India. The bank was pioneer in adapting to policy of first mover in tier 2 cities. The Bank has one of the highest productivity per employee in Indian banking industry.

On 29 July 2004, the Board of Directors of IDBI and IDBI Bank accorded in principle approval to the merger of IDBI Bank with the Industrial Development Bank of India Ltd. to be formed incorporated under the Companies Act, 1956 pursuant to the IDB (Transfer of Undertaking and Repeal) Act, 2003 (53 of 2003), subject to the approval of shareholders and other regulatory and statutory approvals. A mutually gainful proposition with positive implications for all stakeholders and clients, the merger process is expected to be completed during the current financial year ending 31 March 2005.

The immediate fall out of the merger of IDBI and IDBI Bank was the exit of employees of IDBI bank. The cultures in the two organizations have taken its toll. The IDBI Bank now is in a growing fold. With its retail banking arm expanding further after the merger of United western Bank.

IDBI would continue to provide the extant products and services as part of its development finance role even after its conversion into a banking company. In addition, the new entity would also provide an array of wholesale and retail banking products, designed to suit the specific needs cash flow requirements of corporates and individuals. In particular, IDBI would leverage the strong corporate relationships built up over the years to offer customised and total financial solutions for all corporate business needs, single-window appraisal for term loans and working capital finance, strategic advisory and “hand-holding” support at the implementation phase of projects, among others.[citation needed]

IDBI’s transformation into a commercial bank would provide a gateway to low-cost deposits like Current and Savings Bank Deposits. This would have a positive impact on the Bank’s overall cost of funds and facilitate lending at more competitive rates to its clients. The new entity would offer various retail products, leveraging upon its existing relationship with retail investors under its existing Suvidha Flexi-bond schemes.

The responsibility for maintaining standards of corporate governance lies with its Board of Directors. Two Committees of the Board viz. the Executive Committee and the Audit Committee are adequately empowered to monitor implementation of good corporate governance practices and making necessary disclosures within the framework of legal provisions and banking conventions.

[edit] Industrial Investment Bank of India Ltd.

The Industrial Investment Bank of India is one of oldest banks in India.[8] The Industrial Reconstruction Corporation of India Ltd., set up in 1971 for rehabilitation of sick industrial companies, was reconstituted as Industrial Reconstruction Bank of India in 1985 under the IRBI Act, 1984. With a view to converting the institution into a full-fledged development financial institution, IRBI was incorporated under the Companies Act, 1956, as Industrial Investment

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Bank of India Ltd. (IIBI) in March 1997. IIBI offers a wide range of products and services, including term loan assistance for project finance, short duration non-project asset-backed financing, working capital/ other short-term loans to companies, equity subscription, asset credit, equipment finance as also investments in capital market and money market instruments.

In view of certain structural and financial problems adversely impacting its long-term viability, IIBI submitted a financial restructuring proposal to the Government of India on 25 July 2003. IIBI has since received certain directives from the Government of India, which, inter alias, include restricting fresh lending to existing clients approved cases rated corporates, restrictions on fresh borrowings, an action plan to reduce the overhead expenditure, disposal of fixed assets and a time-bound plan for asset recovery/reconstruction. The Government of India had also given its approval for the merger of IIBI with IDBI and the latter had already started the due diligence process.[9] Imtiyaz

But on 17 December 2005 the IDBI rejected any such merger.[10]

[edit] Acquisition of United Western Bank

In 2006, IDBI Bank acquired United Western Bank in a rescue. [11] Annasaheb Chirmule, who worked for the cause of Swadeshi movement, founded Satara Swadeshi Commercial Bank in 1907, and some three decades later founded United Western Bank. The bank was incorporated in 1936, and commenced operations the next year, with its head office in Satara, in Maharashtra State. It became a Scheduled Bank in 1951. In 1956 it merged with Union Bank of Kolhapur, and in 1961 with Satara Swadeshi Commercial Bank.[12] At the time of the merger with IDBI, United Western had some 230 branches spread over 47 districts in 9 states, controlled by five Zonal Offices at Mumbai, Pune, Kolhapur, Jalgaon and Nagpur.