ICICI cash management

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INTRODUCTION OF CASH
MANAGEMENT
Cash management can be defined as all activities undertaken to
ensure maximum cash availability and maximum investment yield on a
government's idle cash. Cash management is concerned with the
efficient management of cash from the time revenue is earned to the
time an expenditure payment clears the bank. At the local government
level, cash-management activities can be categorized as follows:

 Receipt and deposit of cash and negotiable payments

 Custody of monies and securities of the government
 Disbursement of funds upon proper authorization
 Dealing with financial institutions
 Investment of cash in money-market securities and related
instruments
 Cash budgeting and forecasting
 Short-term borrowing

The cash-management function generally is concerned with short-

term investments. Some governments invest pension funds, debt-service
funds, and trust funds for multiyear periods that could be considered
long-term investing; these lie beyond the realm of cash management.

With a good cash management system, you as a retailer can increase

revenue, lower costs, improve customer service and enhance security.
The numbers show that cash is cheaper, faster and a more popular
payment method than the electronic alternatives.

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COMPANY PROFILE
ICICI Bank
ICICI Bank is an Indian multinational banking and financial
services company headquartered in Mumbai, Maharashtra. As of 2014
it is the second largest bank in India in terms of assets and market
capitalization. It offers a wide range of banking products and financial
services for corporate and retail customers through a variety of delivery
channels and specialized subsidiaries in the areas of
investment, life, non-life insurance, venture capital and asset
management. The Bank has a network of 3,820 branches and
11,162 ATMs in India, and has a presence in 19 countries.
ICICI Bank is one of the Big Four banks of India, along with State
Bank of India, Punjab National Bank and Bank of Baroda. The bank has
subsidiaries in the United Kingdom, Russia, and Canada; branches in
United States, Singapore, Bahrain, Hong Kong, Sri Lanka, Qatar and
Dubai International Finance Centre; and representative offices in United
Arab Emirates, China, South Africa, Bangladesh, Thailand, Malaysia and
Indonesia

History

ICICI Bank was established by the Industrial Credit and

Investment Corporation of India (ICICI), an Indian financial institution,
as a wholly owned subsidiary in 1994. The parent company was formed
in 1955 as a joint-venture of the World Bank, The bank was initially
known as the Industrial Credit and Investment Corporation of India
Bank, before it changed its name to the abbreviated ICICI Bank. ICICI

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Bank launched internet banking operations in 1998. Followed by an

equity offering in the form of American Depositary Receipts on
the NYSE in 2000. ICICI Bank acquired the Bank of Madura Limited in an
all-stock deal in 2001 and sold additional stakes to institutional
investors during 2001-02.
In the 1990s, ICICI transformed its business from a development
financial institution offering only project finance to a diversified
financial services group, offering a wide variety of products and
services, both directly and through a number of subsidiaries and
affiliates like ICICI Bank. In 1999, ICICI become the first Indian company
and the first bank or financial institution from non-Japan Asia to be
listed on the NYSE.
In 2000, ICICI Bank became the first Indian bank
In October 2001, the Boards of Directors of ICICI and ICICI Bank
approved the merger of ICICI and two of its wholly owned retail finance
subsidiaries, ICICI Personal Financial Services Limited and ICICI Capital
Services Limited, with ICICI Bank.
The merger was approved by shareholders of ICICI and ICICI Bank
in January 2002, by the High Court of Gujarat at Ahmedabad in March
2002.
In 2008, following the 2008 financial crisis, customers rushed to
ICICI ATMs and branches in some locations due to rumors of adverse
financial position of ICICI Bank.

BOARD OF DIRECTORS
Mr. K.V.Kamath - Chairman
Mr. Barry StoweMrs. Kalpana MorpariaMs. Shikha Sharma - Managing
Director
Mr. N.S.Kannan - Executive Director
Mr. Bhargav Dasgupta - Executive Director

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ICICI Bank Limited

Type Public company

 BSE: 532174
Traded as
 NSE: ICICIBANK
 NYSE: IBN
 BSE SENSEX Constituent
 CNX Nifty Constituent
Industry Banking, Financial services
Founded 1994
Headquarters Mumbai, Maharashtra, India
Area served Worldwide
Key people K. V. Kamath (Chairman)
Ms.ChandaKochhar (MD & CEO)
Products Credit cards, Consumer
banking, corporate
banking,finance and
insurance,investment
banking, mortgage loans, private
banking, wealth management
Revenue US$ 13.52 billion (2012)[1]
Operating US$ 2.12 billion (2012)[1]
income
Profit US$ 1.60 billion (2012)[1]
Total assets US$98.99 billion (2012)[1]
Total equity US$12.62 billion (2012)[1]

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AWARDS
2004 - Best Bank in India Award presented by Euro money Magazine
2007- ICICI Bank has been conferred the Euro money Award 2007 for
the Best Bank in the Asia-Pacific Region
--
CICI Bank wins the Excellence in Remittance Business award by The
Asian Banker
2009
- ICICI Bank bags the "Best bank in SME financing (Private Sector)" at
the Dun & Bradstreet Banking awards
2011
- ICICI Bank is the only Indian brand to figure in the Brands Top 100
Most Valuable Global Brands Report, second year in a row
2012
- Airtel, ICICI among 'top 100 global brands
2013
- ICICI Bank has been adjudged winner at the Express IT Innovation
Award under the Large Enterprise category
2014
- According to the Brand Trust Report 2014, ICICI Bank was ranked 28th
among India's most trusted brands, a research conducted by Trust
Research Advisory.

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OBJECTIVES
ICICI Bank's Green initiative is to make healthy environment in the
organization i.e.; to create intrapersonal skills among the customer and
understanding between employees of the organization.

Broad objectives of the ICICI are:

1. To assist in the creation, expansion and modernization of private

concerns.

2. to encourage the participation of internal and external capital in

the private concerns

3. To encourage private ownership of industrial investment.

4. They are forced to rely on their own money in order to manage

their expenses.

5. Good cash management.

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NEED FOR THE STUDY

 To conduct their operation properly

 This will help them to make sure that they are not spending beyond
their means

 Long term implications for the firm

 Efficient logistics support

 Ensuring timely deposit of collection

 Timely execution of disbursement request

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CASH MANAGEMENT SERVICES

ICICI Bank's Cash Management Services offer full range of advanced
products and services to efficiently process your receivable and payable.

 Collection Solutions
ICICI Bank offers a wide range of collection products to meet the
specific requirements of the clients like local cheque collections,
upcountry cheque collections, cash collections and electronic collections.
ICICI Bank renders quick and effective management of receivables.

 Payments BASED
The payment solutions offered by ICICI Bank include bulk
disbursement solutions for making payments to channel partners
through multiple modes, Payable at Par solutions for payment of
dividend, interest or for redemption and internet-based cheque writing
facility for printing of cheques at your own premises.

 Paper Based
Paper-based payment modes offered under the CMS payment
solutions include cheque printing, Demand draft printing and Internet-
based cheque writing.

a) Cheque Printing
One of the preferable modes of making payment used by corporates
is through the issuance of customer cheques. ICICI Bank offers
customized cheque-writing solutions to various companies. This facility

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includes printing, signing and dispatch of cheques. One important

feature of customer cheques is that they can be customized to suit your
exact requirement. Through this facility the turnaround times for
delivery as well as the costs involved are reduced.

b) Demand Draft
Demand draft printing renders corporations to make bulk
disbursements through demand drafts. This facility includes printing
and despatch of demand drafts / pay orders. In order to meet the
requirements of corporations that want ICICI Bank to issue demand
drafts at locations where ICICI Bank does not have a branch, ICICI Bank
has tied up with various banks, also known as correspondent banks,
thus rendering corporations to make payments not only at ICICI Bank
locations but also at our correspondent bank locations.

c) Internet-Based Cheque Writing

Internet-based cheque writing solution of ICICI Bank provides printing
facility at your premises or at your branches, based on information
uploaded through Corporate Internet Banking.

d) Electronic Payments
Electronic modes of payment solutions offered by ICICI Bank include
Funds Transfer, Real Time Gross Settlement (RTGS) and National
Electronic Funds Transfer (NEFT). Further, ICICI Bank also offers the
facility to send e-mail advices to the beneficiaries for all electronic fund
transfers.

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i. Funds Transfer
This facility can be used for payment by customers to
beneficiaries who are ICICI Bank account holders. This method of
funds transfer is the fastest and the most secure form of
remittance.

ii. Real Time Gross Settlement (RTGS)

RTGS offers functionality of online, real time, funds transfer facility
across banks. This facility can be used for transfers involving an amount
greater than or equal to Rs. 2, 00,000. RTGS advantages include

 Seamless movement of funds

 Real time transfers and faster credit
 Elimination of delays due to outstation funds transfer
 E-mail alerts to beneficiaries

iii. National Electronic Funds Transfer

(NEFT)
NEFT facilitates transfer of funds electronically from one account to
another, between NEFT participant bank branches in India. This product
offers functionality of online funds transfer facility across banks. It is
primarily for low value transactions and offers an efficient, secure,
economic, reliable and expeditious solution for funds transfer.

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e) Dividend Payments
This facility renders payments to shareholders/investors for
dividend, interest, redemption proceeds, IPO refunds and any other
payouts. ICICI Bank is one of the leading players in this business
segment, serving many of the elite corporations in India.

You can choose among a wide array of payment modes that

include physical as well as electronic modes. The physical modes of
payment comprise of warrants and demand drafts, including
foreign demand drafts. The electronic modes of payment comprise
of Funds transfers to ICICI Bank account holders, Real Time Gross
Settlement (RTGS), Electronic Clearing Service (ECS), National
Electronic Funds Transfer (NEFT) and Foreign Telegraphic Transfer
(FTT).

Online Validatio

Extensive network

MIS and reconciliation

Systems and checks to detect fraudulent encashment and

duplicate payments

Dedicated customer service desk

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Benefits & Features of cash management

services

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CASH MANAGEMENT

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CASH MANAGEMENT
ICICI BANK

 Local Cheque Collections

•
One of the largest network spanning over 488 locations.
•
Courier pick-up can be provided.
•
Process flow can be structured to suit the company’s
requirements.

 Upcountry Cheque Collections

•
Coverage of over 3919 locations with tie-ups with correspondent
banks
•
Capability to process cheques drawn on any location in India.
•

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Assured credit given with funds pooled at any ICICI Bank

location. Instrument level tracking of instruments to ensure
faster realization

 Cash Collections

•
Cash Collection from dealers and business associates on behalf
of companies.
•
Cash pick-up facility in 28 locations.
•
Customized MIS for cash collection

 Payment Products

Anywhere Banking
•
Cheques issued payable at par at various ICICI Bank locations.
•
Single account to be operated at any ICICI Bank branch for this
facility.
•
Ideal for small value, large volume payments

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 Fund Transfers

•
Online transfer of funds between accounts maintained with any
branch of ICICI Bank

 Issue of Bulk Demand Drafts/ Pay

orders

•
Capability to issue Bulk Demand Drafts/Pay Orders on various
ICICI Bank and correspondent bank locations
•
Capability to accept online requests from the customers
•
Capability to print beneficiary advice and dispatch
•
Remote printing facilSimple process with a low turnaround
time and delivery.

 Cheque Writing

•
Cheques can be issued on behalf of companies

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Capability of processing large volumes of cheques in a short

turnaround time

Capability of printing facsimile signatures

Capability to print beneficiary advice and dispatch

•
Ideal for bulk payments such as pension payments, gratuity
payments

 At Par Payments

•
Services can be availed for the ‘at par’ payment of dividend
warrants /interest warrants/ refund order/redemption
payments/brokerage payments

•Simplified and streamlined procedures ensuring smooth process

flow online validation of instruments before payment? Regular
reconciliation statements provided by the bank
Covering over 100 major locations through own network (90%of
the payments) Arrangement with correspondent banks thereby
covering over 200 locations through instruments
based payments

•ECS credit facility at all available locations

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Cash Management

Manage your cash flow and liquidity-Effectively and Efficiently

For any organization, cash is the lifeblood that keeps the business
going. That’s why, increasingly, Cash Management has been gaining
importance with organizations that view the services as a crucial part
of their corporate strategies

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DATA ANALYSIS
---------------------------- IN RS.CR.----------------------
MAR 14 MAR 13 MAR 12 MAR 11 MAR 10
CASH FLOW OF ICICI BANK
12 12 MTHS 12 MTHS 12 MTHS 12 MTHS
MTHS
13968.17 11396.69 8803.42 6760.70 5345.25
NET PROFIT BEFORE TAX
NET CASH FROM 4668.60 11102.01 - - 1869.20
OPERATING ACTIVITIES 15238.00 6908.92
NET CASH(USED IN)/FROM - -9431.56 - -2108.82 6150.72
INVESTING ACTIVITIES 12246.48 12280.17

NET CASH(USED IN)/FROM 6838.37 2989.72 28751.76 3105.97 1382.60

FINANCING ACTIVITIES

NET(DECREASE)/INCREASE 112.08 5188.21 2139.23 -5960.84 8907.31

IN CASH & CASH
EQUIVALENT

OPENING CASH & CASH 41417.52 36229.31 34090.08 40050.92 29966.50

EQUIVALENT

CLOSING CASH & CASH 41529.60 41417.52 36229.31 34090.08 38873.60

EQUIVALENT

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Cash flow
(Rs. crore)

Mar ' 14 Mar ' 13 Mar ' 12 Mar ' 11 Mar ' 10

Profit before tax 13,968.17 11,396.69 8,803.42 6,760.70 5,345.32

Net cash flow- -

operating activity 4,668.60 11,102.01 15,238.00 -6,908.92 1,869.21

Net cash used in - -

investing activity 12,246.48 -9,431.56 12,280.17 -2,108.82 6,150.73

Net cash used in fin.

Activity 6,838.37 2,989.72 28,751.76 3,105.97 1,382.62

Net Inc./Dec. in cash

and equivalent 112.08 5,188.21 2,139.23 -5,960.84 8,907.13

Cash and equivalent

begin of year 41,417.52 36,229.31 34,090.08 40,050.92 29,966.56

Cash and equivalent

end of year 41,529.60 41,417.52 36,229.31 34,090.08 38,873.69

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ICICI Bank's Financial Summary OF CASH MANAGEMENT

Parameter MAR'14 MAR'13 Change
(₹ Cr.) (₹ Cr.) %

Net Profit Before Taxes 13,968.17 11,396.69 22.56%

Adjustments for Expenses & Provisions 1,717.93 1,737.27 -1.11%

-
Adjustments for Liabilities & Assets -6,856.51 1,166.95
687.56%

Cash Flow from operating activities 4,668.60 11,102.01 -57.95%

-
Cash Flow from investing activities -9,431.56 -29.85%
12,246.48

Cash Flow from financing activities 6,838.37 2,989.72 128.73%

Effect of exchange fluctuation on translation

851.59 528.03 61.28%
reserve

Net increase/(decrease) in cash and cash -

-739.51 4,660.17
equivalents 115.87%

Opening Cash & Cash Equivalents 41,417.52 36,229.31 14.32%

Cash & Cash Equivalent on Amalgamation /

0.00 0.00 0.00%
Take over / Merger

Cash & Cash Equivalent of Subsidiaries

0.00 0.00 0.00%
under liquidations

Translation adjustment on reserves / op

0.00 0.00 0.00%
cash balalces frgn subsidiaries

Effect of Foreign Exchange Fluctuations 0.00 0.00 0.00%

Closing Cash & Cash Equivalent 41,529.60 41,417.52 0.27%

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METHODOLOGY OF DATA
COLLECTION
THERE ARE TWO METHODS OF DATA COLLECTION

 PRIMARY DATA
The primary data needed for the project analysis has been collected
through unstructured interviews and discussions conducted with the
finance department.

 SECONDARY DATA

 Data is collected from internet

 From books
 From prospectus of bank
 The secondary sources of data are annual reports, brochures,
newspapers and web sources

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HYPOTHESIS ANALYSIS

A hypothesis is a tentative statement about the relationship

between two or more variables. A hypothesis is made in order to find
out correct explanation of the phenomena.

From the data analysis or the cash management process of icici

bank, some points are observed, collected & predicted:-

 Because of proper payment, collection of cash profitability of

bank is satisfactory.
 For specific requirement of customer icici bank should
maintain cash pic-up, cash delivery.
 If Bank should manage cash properly time to time then
operational risk minimized, reduction in cost, security,
increased efficiency.
 Online services help in reduction of time.

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LIMITATIONS OF THE STUDY

It is not possible to judge all parameters to evaluate the efficiency in a

dynamic area like cash management analysis, some of the limitations of
the study are given below:-

 The period of the study is limited.

 Financial matters are sensitive in nature, the same could not
acquire easily.
 It may be due to restrictions imposed by management.
 Data is collected for five projects which is limited.

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RECOMMENDATION &
SUGGESTION

After analysis and interpretation of the cash management

activities of icici bank & on the basis of references and final opinion, I
would like to give the following suggestions:-

 The bank should concentrate on best method of cash

management.
 For the better service new offers would be required.
 Icici must take feedbacks of customers regarding their
services.
 Prepare a monthly cash flow projection for upcoming year.
 Prepare an up to date and accurate balance sheet for
managing cash effectively.
 Analyzed cash flow statement

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Conclusion

From the above analysis of data it can be concluded that icic

manage cash flow effectively by using various method. the bank has a
wide customers base , so the bank should concentrate on this to retain
these customers .

Icici should focus on-

 Launch innovative product

 Better customer services
 Employees & customer retention
All are the key factors of bank for success in future.

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BIBLIOGRAPHY

 BOOKS
FINANCIAL MANAGEMENT BY DR.P.C. TULSIAN

FINANCIAL MANAGEMENT BY L.M. PANDAY

CASH MANAGEMENT DR.PRADIP KUMAR SINHA

 WEB SITE VISITED

www.icicibank.com
www.wikipedia.com
www.google.com
www.finance.answers.com

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