A

PROJECT REPORT ON
“BANKING AND FINANCE”

SUBMITTED BY

THAKKAR RIYA

(4181)

UNDER THE GUIDANCE OF

ASST PROF. VIDHYASAGAR BANSODE

SUBMITTED TO

SAVITRIBAI PHULE PUNE UNIVERSITY

IN PARTIAL FULFILMENT FOR SECOND YEAR OF

BACHELOR OF BUSINESS ADMINISTRATION

(2021-22)

THROUGH

BRACT’S

VISHWAKARMA COLLEGE OF ARTS, COMMERCE & SCIENCE

1
 ACKNOWLEDGEMENT

“Presentation Inspiration And Motivation Have Always Played A Key Role In The
Success Of Any Project.”

I, The Undernamed Student Of BRACT’S Vishwakarma College Of Arts, Commerce And Science
Hereby Acknowledge My Gratefulness Towards All The Personages Associated In The Completion
Of This Project.

On The Very Onset Of This Practical Work, I Avail The Pleasure To Convey My Profound
Gratitude To Savitribai Phule Pune University For Granting Me The Opportunity To Carry Out This
Analytical Study Under Partial Fulfilment Of The Course-Bachelor Of Business Administration.

I Would Also Like To Express My Deep Sense Of Appreciation Towards Vishwakarma College Of
Arts, Commerce And Science; And Its Principal Dr.Arun Patil For Providing Me The Golden
Fortuity To Do This Project.

I Am Ineffably Indebted To My Project Guide Asst Prof.Vidhyasagar Bansode For His

Conscientious Guidance And Encouragement In Accomplishment Of This Project.

Last But Not The Least, A Big Thank-You To All Those Who Helped Me Towards The Fulfilment
Of This Project.

*Any Omission In This Brief Acknowledgement Does Not Mean Lack Of Gratitude*

STUDENT NAME: THAKKAR RIYA NILESH

ROLL NO: 4181
CLASS & SEM: SY.BBA (SEM-III)
SEAT NO:

2
 DECLARATION

I, The Undernamed Hereby Declare That The Project Work Entitled “Banking And Finance”
(Merger And Acquisition Of Banks, Structure And Working Of IRDA, Comparative Analysis Of
One Private And One Nationalised Bank) Has Been Submitted To Savitribai Phule Pune University
And Is The Record Of An Original Work Done By Me Under The Partial Fulfilment Of Bachelor of
Business Administration Course For The Academic Year 2021-22).

*Findings And Conclusions Are Based On The Material Collected By Me.*

*This Project Has Not Been Submitted Or Published To Any Other College Or
Institutes Before*

STUDENT NAME- THAKKAR RIYA NILESH

CLASS & SEM- SY.BBA (SEM-III)
ROLL NO- 4181
SEAT NO

PLACE- PUNE
DATE- 12/02/2022

3
 CERTIFICATE

This Is To Certify That, Miss/Master “THAKKAR RIYA NILESH”

Second Year Has Completed Project Report On
“BANKING AND FINANCE”
Under Practical Work BBA(Sem III)-Department of Commerce.

As Prescribed By The Savitribai Phule Pune University In The Academic

Year 2021-2022

4
 TABLE OF CONTENTS

SR. NO TITTLE PAGE

a.) Tittle Page 01

b.) Acknowledgement 02

c.) Declaration 03

d.) Certificate 04

e.) Table Of Contents 05-06

MERGER AND ACQUISITION OF HDFC BANK
TOPIC-1
AND CBOP BANK
07

: Abstract 08

: Background 09-10

: Chapter 1 Introduction Of Study 11-17

: Chapter 2 Research Methodology 18-24

: Chapter-3 Industry And Company Profile 25-28

: Chapter-4 Data Analysis And Interpretation Of Study 29-38

: Chapter-5 Findings, Suggestions And Conclusion 39-41

TOPIC-2 PPT ON WORKING AND STRUCTURE OF IRDA 42

: Tittle Slide 43

: Synopsis 43

: Introduction To IRDA 44

: Background Of IRDA 44

: Mission Statement Of IRDA 45

: Vision Statement Of IRDA 45

: Functions Of IRDA 46

: Structure Of IRDA 46

5
 : Tenure Of Office 47

: Constitution Of Funds 47

: Concluding Slide 48
TOPIC 3 COMPARATIVE STUDY OF FINANCIAL
PERFORMANCE OF ONE PRIVATE AND 49
ONE NATIONALISED BANK

6
 TOPIC-1
{ MERGER AND ACQUISITION OF HDFC BANK AND CBOP BANK }

7
 ABSTRACT
This Project Aims To Understand “The Merger Of HDFC Bank And CBOP Bank”
The Liberalisation, Privatisation And Globalisation Phenomena Which Started In Early 1990’s;
Gave A Restructured Mount Of Rebellion To The “Banking Industry” By Indulging Various Reforms In
The Economic Scene Of Our Developing Nation-India. This Process Of Abridgement Changes Has
Constantly Redrawn Various Industrial Maps And Brought Competition Not Only From India But Also
From Overseas Through Various Forms Of Corporate Restructuring.

These Restructuring Strategies Can Broadly Be Classified Into Three Paradigm’s As Follows:

 PORTFOLIO RESTRUCTURING:
: An Active Management Strategy For A Portfolio, In Which The Investor Or Fund Manager
Utilizes Fundamental, Technical And Macroeconomic Analysis In Determining When And How To
Change The Securities Ie. Sale Of Assets No Longer Needed Or The Purchase Of Upgraded Ones,
Thereby Rehabilitating The Investment Strategy Is Termed As “Portfolio Restructuring”.

 FINANCIAL RESTRUCTURING:
: A Special Initiative Undertaken To Reorganize Or Reshuffle The Financial Structure Of A
Business Enterprise Which Primarily Involves Reconstitution Of Share Capital And Debt Equity
Structure; To Favourably Change The Contractual Relationships With Lenders, Shareholders And
Other Stakeholders Is Termed As “Financial Restructuring.”

 ORGANISATIONAL RESTRUCTURING:
: A Corporate Action That Involves Reorganizing A Company’s Business Model Or Workforce
Hierarchical Structure, To Have A Definitive Order And A Clear Understanding Of Departmental
Authorities Is Termed As “Organisational Restructuring.”

FORMS OF RESTRUCTURING

Expansion Selloffs Corporate Control Changes in Ownership

l
Structure
: Mergers And : Spinoffs : Premium Buy-Backs : Exchange Offers
Acquisitions : Splitofs : Standstill Agreements : Share Repurchases
: Tender Offers : Splitups : Anti-Takeover Amendments : Going Private
: Joint Ventures : Divestitures : Proxy Contests : Leveraged Buyouts

8
 BACKGROUND
The Seeds Of Systematic Banking Practice In India Were Sown Down In 18th Century, As The
Central Bank Of India And Bank Of Hindustan Were Established In 1786 And 1790
Respectively. Primarily, The Oldest Bank Existence In India Is The State Bank Of India- Which
Originated As Bank Of Calcutta In June 1806; However, Was Immediately Known To Be Called As
The Bank Of Bengal. This Was One Of The Three Presidency Banks, The Other Two Being The
Bank Of Bombay And The Bank Of Madras, All Three Of Which Were Established Under Charters
From The British East India Company. For Many Years These Presidency Banks Acted As Quasi-
Central Banks, So As Did Their Successors. Subsequently, The Bank Of India, Baroda Bank,
Corporate Bank And Indian National Bank Were Also Established Between 1906-1911 Under
Swadeshi Movement. The Central Bank of India Established In 1911 By Sir Sorabji Pochkhanawala
Became The First Commercial Indian Bank Completely Owned And Managed By Indians.
Moreover, The History Of Banking Industry In India Got Divided Into Two Periods:

PRE-
LIBERALIZATION POST-
LIBERALIZATION

 PRE-LIBERALIZATION:
 The Government Of India Initiated Measures To Play An Active Role In The Economic Aspect Of
The Nation, Thus The Industrial Policy Resolution Adopted By The Government In 1948 Envisaged
A Mixed Economy.
 The Banking Sector Also Witnessed Considerable Benefits; As The Government Of India Took The
Following Major Steps Post-Independence:
- Nationalization Of Reserve Bank In 1949
- Enactment of Banking Regulation Act In 1949
- Reserve Bank Of India Scheduled Banks' Regulations, 1951
- Nationalization Of Imperial Bank Of India In 1955, With Extensive Banking Facilities On A
Large Scale Especially In Rural And Semi-Urban Areas
- Nationalization of SBI subsidiaries in 1959

9
 Furthermore, The Government Of India Issued An Ordinance And Nationalized The 14 Largest
Commercial Banks With Effect From Midnight Of July 19, 1969.
 Within Two Weeks Of The Issue Of The Ordinance, The Parliament Passed The Banking
Companies (Acquisition And Transfer Of Undertaking) Bill, And Received Its Presidential
Approval On August 6, 1969.
 Lasty, Second Dose Of Nationalization Of 6 More Commercial Banks Took Place In 1980.

 POST-LIBERALIZATION:
 The Government Of India Headed By Narasimha Rao Committee, Decided To Usher In Several
Reforms That Are Collectively Termed As Liberalization In The Indian Media With Manmohan
Singh Whom He Appointed Finance Minister.
 In The Early 1990’s, The Then Narsimha Rao Government Embarked On A Policy Of
Liberalisation, Licensing A Small Number Of Private Banks. These Institutions Thus Came To
Be Known As New Generation Tech-Savvy Banks And Included Global Trust Which Later
Amalgamated With Oriental Bank of Commerce, Axis Bank(Earlier As UTI Bank),ICICI Bank
and HDFC Bank.
 This Move Along With The Rapid Growth Of Indian Economy, Revitalized The Banking
Sector In India, Which Has Seen Rapid Growth With Strong Contribution From All The
Three Sectors Of Banks Namely-Government Banks, Private Banks And Foreign Banks.
 Hence, This Change Enhanced The Development Of Indian Banking Industry On An Overall
Basis.

10
 CHAPTER I- INTRODUCTION
The Phrase “Mergers And Acquisitions” (Commonly Abbreviated As M&A) Refers To The Aspect Of
Corporate Strategy, Corporate Finance And Management Dealing With The Buying, Selling And
Combining Of Different Companies That Can Aid, Finance Or Help A Growing Company To Grow
Rapidly Without Having To Create Another Business Entity.

 MERGERS:

 Merger Also Defined As ‘Amalgamation’ Is A Combination Of Two Or More Companies Into

A Single Company, Where One Survives And Others Losses It’s Corporate Existence.
 It Can Often Resemble A Takeover But Result In A New Company Name (Often Combining
The Names Of Original Companies) Wherein All Assets, Liabilities And The Stock Of One
Company Stand Are Transferred To Transferee Company In Consideration Of Payment For:
- Equity Shares In The Transferee Company
- Debentures In The Transferee Company
- Cash
- A Mix Of The Above Modes Etc.
 Such Actions Usually Occur When Merging Companies With About Same Size Have Mutual
Consent Towards Each Other And Are Concerned With Improving Quality Operations, Effective
Management Of Affairs And Overall Gains Of Company; Which Provides Them Better Deals In
Raising Their Status, Perks And Fringe Benefits.
 Additionally, They Are More Often Undertaken To Gain Market Share, Cut Operating Costs,
Extend New Markets, Combine Common Goods, Raise Sales And Increase Profits- All Of Which
Would Benefit The Shareholders Of The Company.
 Hence, Mergers Lead To A Reduction In Trade Barriers And Assists The Companies In Uniting
Their Strengths, Talents, Resources And Weaknesses.

11
  TYPES OF MERGERS:
 Based On The Offerors Objectives Profile; Combinations Could Be Vertical, Horizontal,
Congeneric, Conglomeratic And Reverse As Precisely Described Below:
IZ
V
S
C
O
N
L
T
A
G
R
E
M
H

 VERTICAL MERGER:
 A ‘Vertical Merger’ Is Any Merger That Occurs When Two Or More Firms, Operating At
Different Levels Within An Industry's Supply Chain Merge Together.
 The Two Types Of Vertical Mergers Are As Follows:

VERTICAL MERGERS

FORWARD MERGERS BACKWARD MERGERS

When An Entity Gets Merged With The Upward Entity Of The Supply Chain, Which Is Closer To The
Customer, This Type Of Merger Is Known As A Forward Merger Whereas When Entity Gets Merged
With The Downward Entity Or The Entity Which Are Below In The Supply Chain, Such A Merger Is
Known As A Backward Merger.

12
  However, This Makes It Difficult For Other Competitors To Access An Important Component
Of Product Or To An Important Channel Of Distribution Which Is Called As "Vertical
Foreclosure" Or "Bottleneck" Problem; Thereby, Eliminating Sales Taxes And Other
Marketing Expenditures.

 HORIZONTAL MERGER:
 A ‘Horizontal Merger’ Is Any Merger That Arises As A Business Consolidation Between Firms
Who Operate In The Same Space, Often As Competitors Offering The Same Good Or Service.
 Because The Merging Companies' Business Operations May Be Very Similar, There May Be
Opportunities To Join Certain Operations, Such As Manufacturing And Thus Reduce Costs.
 Nevertheless, Such Mergers Are Common In Industries With Fewer Firms; As Competition
Tends To Be Higher And Potential Gains In Market Share Become Much Greater.

 CONGENERIC MERGER:
 A ‘Congeneric Merger’ Is Any Merger Where The Acquiring Company And The Target
Company Are In A Same Or Closely Related Industry But Have Different Business Lines Or
Products.
 The Two Companies Involved In A Congeneric Merger May Share Similar Production
Processes, Distribution Channels, Marketing Strategies Or Technologies Etc.
 Alike, Overlap Created Between The Two Companies In A Congeneric Merger Can Create A
Synergy Where The Combined Performance Of The Merged Companies Is Greater Than The
Individual Companies Themselves.

 REVERSE MERGER:
 A ‘Reverse Merger’ Is When A Private Company Becomes A Public Company By Acquiring
The Control Of It Ie. It Saves A Private Company From The Complicated Process And
Expensive Compliance Of Becoming A Public Company.
 However, There Is Another Angle To The Concept Of A Reverse Merger. When A Weaker Or
Smaller Company Acquires A Bigger Company, It Is Called As A Reverse Merger.
 In Addition, When A Parent Company Merges Into Its Subsidiary Or A Loss-Making
Company Acquires A Profit-Making Company, It Is Also Termed As A Reverse Merger.
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 CONGLOMERATE MERGER:
 A ‘Conglomerate Merger’ Is Any Merger That Is Not Horizontal Nor Vertical; It Generally
Occurs When Two Or More Firms In Different Industries Or Sectors Operating At Different
Geographic Areas Combine Together.
 The Two Types Of Conglomerate Mergers Are As Follows:

CONGLOMERATE MERGERS

PURE CONGLOMERATE MIXED CONGLOMERATE

MERGERS MERGERS

Pure Conglomerate Mergers Have Nothing In Common Whereas Mixed Conglomerate Mergers
Involves Companies Which Look For Diversification In Business, Such As An Extension Of
Products To Different Geographical Locations Or Development Of New Products.
 Ultimately, In Such Cases A Company Acquires A Company Which Is Not At All Connected
With The Area Of Operations Of Acquirer Company.

 OTHER MERGERS:

OTHER MERGERS

MARKET EXTENSION PRODUCT EXTENSION

MERGERS MERGERS

 Market Extension Merger Helps The Companies To Have An Equal Access To A Bigger
Market And A Bigger Client Base Whereas Product Extension Merger Enables The New
Company To Go In For A Pooling Of Their Products So As To Serve A Common Market,
Which Was Earlier Fragmented Among Them.
 Additionally, Various Types Of Mergers Also Include Hostile Merger, Bailout Merger, Defacto
Merger, Strategic Merger, Cash Merger, Parent-Subsidiary Merger Etc.

14
 AQUISITIONS:
 An Acquisition Occurs When One Company Takes Control Of Or Acquires Another Existing
Company.
 Normally, An Acquisition Occurs When A Larger Company Buys A Smaller Company,
Although That Isn’t Always The Case. Small Companies Can Acquire Larger Companies Too.
 Acquisitions Can Be The Amicable Result Of Friendly Discussions Between Two Firms In
Which The Target Company Welcomes The Acquisition. In This Situation, The Two
Companies Negotiate The Terms Of Acquisition And Ultimately Reach An Agreement.
 However, Acquisitions Can Also Occur Against The Will Of The Acquired Firm’s Management
Ie.‘Hostile Takeover.’ In A Hostile Takeover, An Outside Firm Acquires A Controlling Interest
In The Target Firm By Purchasing More Than 50% Of The Target Company’s Shares. This Is
Done By Offering The Existing Shareholders A Higher Price For Their Shares Than What They
Could Currently Get On The Open Market, Thereby Enticing Them To Sell.
 Regardless Of Whether The Acquisition Is Friendly Or Hostile, The Shares Of The Acquired
Firm Are Normally Bought For More Than Their Current Market Value.
 The Following Are The Various Types Of Acquisitions:

An Acquisition Can Be Paid For In

Cash, Through A Security Payment
Such As A Stock-For-Stock Exchange,
A Leveraged Buyout Methods.

A Company Can Acquire Another By

TYPES OF Giving Cash To The Existing
ACQUISITIONS Shareholders Of The Target Company
For Their Shares.

In A Security Payment, The Acquiring

Company Will Offer New Securities In
Exchange For The Securities And
Assets Of The Target Company.

 Lastly, The Words “Acquisition” And “Merger” Are Often Used Interchangeably In Practice,
But The Two Are Technically Distinct.

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 RELATIONSHIP BETWEEN MERGER AND AQUISITION:
“Mergers And Acquisition” Is A General Term That Describes The Consolidation Of Companies
Or Assets Through Various Types Of Financial Transactions, Including Mergers, Acquisitions,
Consolidations, Tender Offers, Purchase Of Assets, And Management Acquisitions. When A
Company Acquires Another Company, The Acquiring Company Is Called The ‘Acquirer
Company ’And The Company Which Is Being Acquired Is Called The ‘Acquired Company’.
The Acquirer Company Has Two Alternatives For Dealing The Acquired Company. First The
Acquiring Company Can Take-Over The Management Of Acquired Company And Run It As A
Separate Company With Its Own New Management. This Is Called The ‘Take-Over’ Or The
‘Change Of Management’. The Second Alternative For Acquirer Company Is To Merge The
Acquired Company Into Itself. This Is Called The ‘Merger’. In Case Of Mergers There Could Be
Three Situations. They Are As Follows:
- The Acquirer Company Merges The Acquired Company Into Itself And The Acquired
Company Loses Its Entity,
- The Acquirer Company May Merge With The Acquired Company And May Give Up
Its Own Identity. Normally This Kind Of Merger Takes Place For Getting Some Tax
Benefits.
- There Could Be A Situation In Which Both The Acquirer Company And Acquired
Company Loses Their Identity And Form Altogether New Company With A New Name.

OLD OLD
COMPANY COMPANY NEW
COMPANY
'A' 'B'
MERGER

OLD OLD OLD

COMPANY COMPANY COMPANY
'A' 'B' 'A' OR 'B'
ACQUISITION

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 DISTINGUISH BETWEEN MERGER AND ACQUISITION:
PARAMETER
OF MERGER
COMPARISON
A ‘Merger’ Is A Situation Where Two Or
DEFINITION More Companies Combine To Form A New
Company.
A Merger Happens To Decrease
PURPOSE Competition As Well As To Increase
Operational Efficiency.
A Merger Is Considered As Friendly And
TERMS
Planned Activity And Cannot Be Hostile.
The Size Of The Merging Companies Is
SIZE
More Or Less The Same.
The Powers Remain The Same For Both
POWER
The Merging Companies.
In The Situation Of A Merger, A New
NAME
Name Is Given To The Company.
LEGAL
In Mergers, There Are More Legal
FORMALITIE
Formalities As Compared To Acquisition.
S A Merger.
In A Merger, Two Or More Companies
That Consider Each Other To Be Of The
LEVEL
Same Level Come Together To Form A
New Company.
RESULTANT The Company Absorbed Will Cease.
Merger Of Union Bank Of India With
EXAMPLE
Andhra Bank And Corporation Bank.
ACQUISITION
An ‘Acquisition’ Is A Situation
Where One Company Takes Over
The Other Company.
An Acquisition Happens To
Consolidate Instantaneous Growth.
An Acquisition Is Considered As
Either Voluntary Or Involuntary
And Can Be Hostile.
The Acquiring Company Is Larger
Or Bigger Than Acquired One.
The Ultimate Powers Lie In The
Hand Of The Acquiring Company.
In The Situation Of Acquisition, The
Name Of The Acquiring Company
Can Be Used.
In Acquisition, There Are Fewer
Legal Formalities As Compared To
In Acquisition, The Company
Which Is Acquiring The Other
Company Is Considered Larger And
On A Higher Level.
All Companies Involved Will Cease.
Punjab National Bank Taking Over
Oriental Bank Of Commerce And
Union Bank Of India
17
 CHAPTER II- RESEARCH METHODOLOGY

 OBJECTIVES OF STUDY:

 To Study The ‘Concept Of Merger And Acquisition’

 To Study The ‘Types Of Mergers And Acquisitions’

 To Study The ‘Relationship Between Mergers And Acquisitions’

 To Study The ‘Distinction Between Mergers And Acquisitions’

 To Study The ‘History Of Mergers And Acquisitions In Indian Banking Sector’

 To Study The ‘Purpose Of Mergers And Acquisitions In Indian Banking Sector’

 To Study The ‘Stages Involved In Mergers And Acquisitions’

 To Study The ‘Company Profile Of HDFC Bank And CBOP Bank’

 To Study The ‘Reasons For Merger Of HDFC Bank And CBOP Bank’

 To Study The ‘Insights Into The Merger Of HDFC Bank And CBOP Bank’

 To Study The ‘Pre-Merger And Post-Merger Financial Analysis Of HDFC Bank And CBOP

Bank’

 To Study The ‘Effect Of Merger And Acquisition Of HDFC And CBOP Bank’
 To Study The ‘Benefits Of Merger And Acquisition Of HDFC And CBOP Bank’

 DATA COLLECTION:

 The Analysis Is Purely Based On The Secondary Data.

 Secondary Research Based On:
1. Business Magazines
2. Internet Sources
3. Finance Books
4. Newspapers
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 5. Journals Etc.

 HISTORY OF MERGERS AND AQUISITIONS IN INDIAN BANKING SECTOR :

 In The 1950s And 1960s There Were Instances Of Private Sector Banks, Which Had To Be
Rescued Or Closed Down Because They Had Very Low Capital And Were Mostly Operating
With Other People’s Money.
 For Instance, Against Total Deposits Of Rs.2750 Crore At The End Of December 1968, The
Paid-Up Capital Of Private Sector Banks Was Only Rs.28.5 Crore Or Just A Little Over 1%.
 In 1960, The Failure Of Palai Central Bank And Laxmi Bank Led To Loss Of Confidence In The
Banking System As A Whole
 Hence, In 1961 The Banking Companies (Amendment) Act Empowered RBI To Formulate And
Carry Out 9 Bank Mergers And Acquisitions- A Scheme For The Reconstitution And
Compulsory Amalgamation Of Sub-Standard Banks With Well-Managed Ones.
 Consequently, Out Of 42 Banks Which Were Granted Moratoria, 22 Were Amalgamated With
Other Banks, One Was Allowed To Go Into Voluntary Liquidation, One To Amalgamate
Voluntarily With Another Bank, Three Were Ordered To Be Wound Up And The Moratorium
On Three Was Allowed To Lapse.
 In India, Mergers Were Been Used To Bail-Out Weaker Banks Till The Narasimham
Committee-II Discouraged This Practice. For Instance, Since The Mid-1980s, Several
Private Banks Had To Be Rescued Through Mergers With Public Sector Banks, As Shown
Below:

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 The Merger Of The Loss-Making New Bank Of India With The Profitable Punjab National
Bank Was The First Instance Of Merger Of Two Public Sector Commercial Banks.
 Now Public Sector Commercial Banks Are Themselves In Need Of Restructuring So It May Be
More Efficient To Close Down Unviable Bank.
 However, The Recent Merger Of Banks In Private Sector , I.E., HDFC Bank And Times Bank
(1999) As Well As ICICI Bank And Bank Of Madura (2000) , Could Herald A Welcome Trend
As It Is Driven By Commercial Considerations.
 Subsequently, The RBI Also Allowed Developmental Financial Institutions To Merge With
Banks On The Recommendation Of Khan Group. As A Result Of This ICICI Limited Merged
Itself With ICICI Bank And IFCI Limited Merged With The Punjab National Bank.
 As Far As The Merger Activity In Banking Sector Was Concerned It Was Only Restricted To
Merger Of Weak Banks With A Healthy Bank. However, With The Liberalization Policies Of
Government, Many Private Banks Came Into Existence.
 In Order To Survive In The Competition And Get A Market Share These New Banks Started
Offering Innovative And Attractive Products With The Help Of Their Technology. Some Of The
Services Like Mobile Banking, Internet Banking, Tele-Banking, Online Share Trading Services,
Depository Services , Anywhere Banking, Anytime Banking Which Are Offered By These New
Generation Banks Were Never Thought Of About A Decade Ago In India.
 Consequently, The Public Sector Banks Also Realised The Need Of The Hour And Started
Using Technology In A Big Way And Got Mutually Benefited
20
  PURPOSE OF MERGERS AND AQUISITIONS IN INDIAN BANKING SECTOR :

 In India, The Merger And Takeover Phenomenon In The Past Was Understood Largely As
One Of The Sick Units Being Taken Over By Healthy Ones. This Is Because Of The Reason
That Sec. 72A Of The Income Tax Act, 1961, Provides For The Carry Forward Of Losses.
 The Advantage That The Merging Corporations Get Is That The Book Losses Of The Sick
Corporation Get Written Off Against The Future Profits, Thus Saving The Profitable
Corporations Some Tax Outflow.

PURPOSE OF MEREGERS

GROWTH MERGER
WITH OF
EXTERNAL WEAKER
EFFORTS BANKS

DERUGULATION TECHNOLOGY NEW PRODUCTS PUBLIC BASE OVER CAPACITY

CAPACITY

21
1.) GROWTH WITH EXTERNAL EFFORTS:
 With The Economic Liberalization The Competition In The Banking Sector Has Increased And
Hence There Is A Need For Mega Banks, Which Will Be Intensely Competing For Market
Share.
 In Order To Increase Their Market Share And The Market Presence Some Of The Powerful
Banks Have Started Looking For Banks Which Could Be Merged Into The Acquiring Bank.
 They Realized That They Need To Grow Fast To Capture The Opportunities In The Market.
Since The Internal Growth Is A Time Taking Process, They Started Looking For Target Banks.

2.) DEREGULATION:
 With The Liberalisation Of Entry Barriers, Many Private Banks Came Into Existence.
 As A Result Of This There Has Been Intense Competition And Banks Have Started Looking
For Target Banks Which Have Market Presence And Branch Network.

3.) TECHNOLOGY:
 The New Banks Which Entered As A Result Of Lifting Of Entry Barriers Have Started Many
Value Added Services With The Help Of Their Technological Superiority.
 The Older Banks Which Can Not Compete In This Area May Decide To Go For Mergers With
These High-Tech Banks.

4.) NEW PRODUCTS/SERVICES:

 New Generation Private Sector Banks Which Have Developed Innovative Products/Services
With The Help Of Their Technology May Attract Some Old Generation Banks For Merger
Due To Their Incapacity To Face These Challenges.

5.) OVER CAPACITY:

 The New Generation Private Sector Banks Have Began Their Operation With Huge Capacities.
With The Presence Of Many Players In The Market, These Banks May Not Be Able To Capture
The Expected Market Share On Its Own.
 Therefore, In Order To Fully Utilise Their Capacities These Banks May Look For Target
Banks Which May Not Have Modern Day Facilities.

6.) CUSTOMER BASE:

22
 In Order To Utilise The Capacity Of The New Generation Private Sector Banks, They Need
Huge Customer Base.
 Creating Huge Customer Base Takes Time. Therefore, These Banks Have Started Looking For
Target Banks With Good Customer Bases.
 Once There Is A Good Customer Base, The Banks Can Sell Other Banking Products Like Car
Loans, Housing Loans, Consumer Loans, Etc To These Customers As Well.

7.) MERGER OF WEAK BANKS:

 There Has Been A Practice Of Merging Weak Banks With A Healthy Bank In Order To Save
The Interest Of Customers Of The Weak Bank.
 Narasimham Committee–II Discouraged This Practice. Khan Group Suggested That Weak
Developmental Financial Institutions (DFI) May Be Allowed To Merge With Healthy Banks.

 STAGES INVOLVED IN MERGERS AND ACQUISITIONS:

 STAGE 1: PRE-ACQUISITION REVIEW:

 This Stage States That, Before The Merger Has Been Taken Place Between The Companies; It
Need To Firstly Assess Of Its Own Regarding The Need For Merger, Valuation Of Company
And Which Merger Is Best Suitable Etc.
 All These Reviews Will Be Done In This Stage To Process The Data And Carry On With The
Next Step Of Merger.

 STAGE 2: SEARCH & SCREEN TARGETS:

 The Data Collected Earlier Gets Screened In This Step. It Means The Company Will Be
Filtering Its Options And Analyse Among The Available Opportunities.
 So That They Can Minimize Their List Of Companies Available To Take Proper Decision.

 STAGE 3: INVESTIGATE & VALUATION OF TARGET:

 Here The Companies Will Be Shortlisted Through Primary Screening And Detailed Analysis
Will Be Conducted Regarding Of Its Assets And Liabilities.
 Then The Companies Chosen Will Be Valued In Accordance Of Its Net Worth In Order To Go
With The Process Of Merger. This Is Also Referred To As Due Diligence.

 STAGE 4: ACQUIRE THE TARGET THROUGH NEGOTIATIONS:

23
  A Particular Company Among The Targeted Companies Is Selected In This Stage And The
Next Step Is Preceded With The Negotiation Of That Company.
 Thus, The Both Companies Come Into A Deal On A Certain Value To Form The Merged
Company.

 STAGE 5: POST MERGER INTEGRATION:

 If All The Above Steps Fall In Place, There Is A Formal Announcement Of The Agreement
Of Merger By Both The Participating Companies.

 NEED FOR THE STUDY:

 The Actual And Only Need Was; Recently There Have Been Many Mergers Happening
In Banking Institutions And It Is Very Important To Analyse Them And Be Cognizant.

 Hence, The Present Study Is An Attempt To Analysis The Raise Of Merger Deal Between
HDFC Bank And Centurion Bank Of Punjab.
24
 LIMITATIONS OF THE STUDY:
 The Study Is Only Related To Merger Of HDFC Bank With Centurion Bank Of Punjab.
 Due To Security Reasons Or Whatsoever, The Officials Always Hesitated To Provide Primary
Data.
 Secondly, Due To Covid-19 Pandemic Data Collection From National Primary Sources Was
Not Possible At All.
 The Data Analysed Is Completely Based On Secondary Sources.
 Consequently, Any Error In The Secondary Data Would Lead To A Default In This Analysis.

CHAPTER III- INDUSTRY AND COMPANY PROFILE

 INTRODUCTION OF HDFC BANK:

 ‘Housing Development Finance Corporation Bank Limited’ Is An Indian Banking And
Financial Services Company Headquartered In Mumbai; Incorporated In August 1994 After
Reserve Bank Of India Allowed Establishing Private Sector Banks.
 HDFC Bank Has 1725 Branches And Over 4,232 ATM’s, In 779 Cities In India And All Of
These Branches Are Linked On An Online Real-Time Basis.
 It Is India's Largest Private Sector Bank By Assets And The Third Largest Company By
Market Capitalisation Of $122.50 Billion On The Indian Stock Exchanges.
25
  It Provides A Number Of Products And Services Including Wholesale Banking, Retail
Banking, Treasury, Auto Loans, Two-Wheeler Loans, Personal Loans, Loans Against
Property, Consumer Durable Loan, Lifestyle Loan And Credit Cards Etc.
 As Of 2021, The Bank Had Total Assets Of ₹1746870 Crore (US$230 Billion), Net Income
Of ₹31116 Crore (US$4.1 Billion), Total Equity Of ₹203169 Crore (US$27 Billion) And
Total Revenue Of ₹120883 Crore (US$16 Billion).
 ‘Parivartan’ Is An Umbrella Term For All Of The Corporate Social Responsibility Initiatives
By HDFC Bank And It Had Spend ₹634.91 Crore Towards It In FY 2020-21. Out Of Which
Over Rs 110 Crore Were Allocated And Utilised Towards Initiatives Focused On Covid-19
Relief. Additionally, HDFC Bank In Association With Cellular Service Provider Orange Has
Launched The Entire Range Of Mobile Banking Services And Mobile Commerce Services
Using Wireless Application Protocol (WAP) Technology.

 HISTORY OF HDFC BANK:

 HDFC Bank Was Incorporated In 1994 By Housing Development Finance Corporation
Limited (HDFC), India's Largest Housing Finance Company.
 It Was Among The First Companies To Receive An 'In Principle' Approval From The
Reserve Bank Of India (RBI) To Set Up A Bank In The Private Sector. The Bank Started
Operations As A Scheduled Commercial Bank In January 1995 Under The RBI's
Liberalisation Policies.
 Times Bank Limited (Owned By Bennett, Coleman & Co. / Times Group) Was Merged With
HDFC Bank Ltd., In 2000. This Was The First Merger Of Two Private Banks In India.
Shareholders Of Times Bank Received 1 Share Of HDFC Bank For Every 5.75 Shares Of
Times Bank.
 In 2008 HDFC Bank Acquired Centurion Bank Of Punjab Taking Its Total Branches To More
Than 1,000. The Amalgamated Bank Emerged With A Base Of About Rs. 1,22,000 Crore
And Net Advances Of About Rs.89,000 Crore. The Balance Sheet Size Of The Combined
Entity Is More Than Rs. 1,63,000 Crore.
 In 2021, The Bank Acquired A 9.99% Stake In FERBINE, An Entity Promoted By Tata
Group, To Operate A Pan-India Umbrella Entity For Retail Payment Systems, Similar To
National Payments Corporation Of India.
 Consequently, In September 2021 The Bank Partnered With Paytm To Launch A Range Of
Credit Cards Powered By The Global Card Network Visa.

26
  HDFC Bank Has Also Entered Into Strategic Alliances With 10 Overseas Banks To Provide
Customers With A Wide Range Of Derivatives Including Interest Rate And Foreign
Currency Swaps.

 Surprisingly, Now It Has Also

Introduced The Freedom Account
For The Average Retail Customer
Located In The Major Metros As
A Means To Wean A Way The
Middle-Income Market From
Nationalised Banks.

 AWARDS AND RECOGNITIONS OF HDFC BANK:

 FINANCIAL YEAR 2016-17:-

- Best Banking Performer, India In 2016 By Global Brands Magazine Award
- Best Performing Branch In Microfinance Among Private Sector Banks By NABARD, 2016
- Award For Best Performance In Microfinance
- KPMG Study Of India's Best Banks, Bank Of The Year & Best Digital Banking Initiative
Award 2
- Brandz Rankings, Most Valued Brand In India For Third Successive Year
- Finance Asia Poll On Asia's Best Companies 2015, Best Managed Public Company – India
- J. P. Morgan Quality Recognition Award, Best In Class Straight Through Processing Rates.

 FINANCIAL YEAR 2018-19:-

- Company Of The Year: The Economic Times Corporate Excellence Awards
- Best Performing Private Bank In Total Aadhaar Generation & Update: Aadhaar Excellence
Awards
- NCPI - National Payments Excellence Awards 2019
- Best Bank: New Private Sector – FE Best Bank Award
- Winner In Innovation And Inclusiveness In Priority Sector Lending – 11th Inclusive Finance
India Awards (IFI) 2019

27
 - Ranked 1st In 2019 Brandz Top 75 Most Valuable Indian Brands HDFC Bank Was Featured
For The 6th Consecutive Year
- Among The Most Honoured Company List, Institutional Investor All-Asia (Ex-Japan)
Executive Team 2019 Survey
- Best Large Bank & Fastest Growing Large Bank In 2019, By Business World Magna
Awards.

 FINANCIAL YEAR 2020-21:-

- India's Leading Private Sector Bank: Dun & Bradstreet BFSI Awards 2020
- Best Bank In India: Euromoney Awards
- Best Bank In India: Financeasia Country Awards 2021
- Best Bank In India: Financeasia Country Awards
- Best Bank For SME’s Asia Money Best Bank Awards.

 INTRODUCTION OF CBOP BANK:

 The Centurion Bank Of Punjab (Formerly Centurion Bank) Was An Indian Private Sector Bank
That Provided Retail And Corporate Banking Services.
 It Operated On A Strong Nationwide Franchise Of 403 Branches And Had Over 5,000
Employees.
 The Bank Listed Its Shares On The Major Indian Stock Exchanges And On The Luxembourg
Stock Exchange. On 23 May 2008, HDFC Bank Acquired Centurion Bank Of Punjab.

 HISTORY OF CBOP BANK:

 Centurion Bank Was Incorporated On 30 June 1994 And Received Its Certificate Of
Commencement Of Business On 20 July.
 It Was A Joint Venture Between 20th Century Finance Corporation And Its Associates, And
Keppel Group Of Singapore Through Kephinance Investment (Mauritius). Centurion Had A
Network Of Ten Branches, Which Grew To 29 Branches The Next Year. Also In 1995
Centurion Bank Amalgamated 20th Century Finance Corporation.
 On 29 June 2005, The Boards Of Directors Of Centurion Bank And Bank Of Punjab Agreed To
A Merger Of The Two Banks. The Combined Bank Took As Its Name Centurion Bank Of
Punjab.

28
 Bank Of Punjab Also Had Been Founded In 1994. In 2007, Centurion Bank Of Punjab Acquired
Thrissur-Based Lord Krishna Bank, And Soon It Was Acquired By HDFC Bank, Which Was
Also Incidentally Begun In 1994.

29
 CHAPTER-IV DATA ANALYSIS AND INTERPRETATION

 REASONS FOR MERGER OF HDFC AND COBP:

 The HDFC Bank Was Amongst The First To Get A Banking License, The First To Do A
Merger In The Private Sector With Times Bank In 1999, And Now After The Merger Of
CBOP Bank Of Geographic Area, It Was The Largest Merger In The Private Sector Banking
Space In India.
 HDFC Bank Was Looking For An Appropriate Merger Opportunity That Would Add Scale,
Geography And Experienced Staff To Its Franchise.

 This Opportunity Arose And Also The Bank Thought It's A Beautiful Route To Supplement
HDFC Bank’s Organic Growth.

 The Bank Believes That CBOP Bank Of Geographic Area Would Be The Correct Slot In
Terms Of Culture, Strategic Intent And Approach To Business.

 The HDFC Bank-CBOP Merger Is Expected To Be A Win-Win For Both Banks In Terms Of
Both Asset Size And Footprint. While CBOP Is Concentrated In The Northern And Southern
Parts Of The Country, HDFC Bank Is Focused Throughout India. These Are Exciting Times
For The Indian Industry.

 The Planned Merger Can Position The Combined Entity To Considerably Exploit
Opportunities During A Market Globally Recognized United Of The Quickest Growing.

 This Is Significantly Optimistic Concerning The Potential Of Business Synergies And Cultural
Work Between The 2 Organizations. The Combined Entity Is An Excellent Bigger Force
Within The Market.

 Over The Previous Couple Of Years, Centurion Bank Of Punjab Has Set Benchmarks For
Growth. The Bank Thereon Day Incorporates A Giant Nationwide Network, A Particularly
Valuable Franchise, 7,500 Gifted Workers, And Strong Leadership Positions In The Market
Place.

30
 INSIGHTS INTO THE MERGER OF HDFC AND CBOP:
 The Merger Between HDFC Bank And Centurion Bank Of Punjab Has Been Finalized On 26
Feb, 2008.

 The Swap Quantitative Relation For Merger Is Around 29 Shares Of Re 1 Of CBOP; An

Investor Will Get One Share Of Rs 10 Of HDFC Bank.

 In Last 2 Days, At The Time Of Merger The Share Price Of CBOP Moved From Rs 49.85 To
Rs 56.40. However, It Seems, Investors Of HDFC Bank Didn't Just Like The Development.

 The Share Price Of HDFC Bank On Thursday Moved Up From Rs 1,534.50 To Rs 1,543. But
In Next Day, It Fell Sharply To Rs 1,475. Prior To This, In August 2007, CBOP Was Merged
With Lord Krishna Bank.

 Approved A Swap Ratio Of 1:29 (One Share Of HDFC Bank For Every 29 Shares Of
Centurion Bank Of Punjab Held), For The Proposed Merger Of Centurion Bank Of Punjab
With HDFC Bank.

 The Name Of The Bank Would Stay As HDFC Bank. The Combined Entity Would Have A
Nation-Wide Network Of 1,148 Branches, The Largest Among Private Sector Banks, A
Strong Deposit Base Of Around Rs. 120,000 Crore And Net Advances Of Around Rs. 85,000
Crore. The Balance-Sheet Size Of The Combined Entity Would Be Over Rs. 150,000 Crore.

31
  FINANCIAL ANALYSIS OF HDFC-CBOP BANK:

PRE-MERGER ANALYSIS OF HDFC

PARTICULARS/YEARS 2007 2006 2005

NET PROFIT (LAKHS)

11415 87078 66556

EPS (%) 22.92 27.92 36.29

TOTAL ASSETS/LIABILITIES
51429 73506.29 91235.69
(CRORES)

120000

100000

80000 Net Profit

60000 EPS

40000 Total Assets/Total

Liabilities
20000

0
2007 2006 2005

 INTERPRETATION:

• In The Above Table, The Net Profit Of HDFC Bank Is High In The Year Of 2007 Compared
With The Rest Of The Years. Also Shows It Is Gradually Increasing From The Year 2005.
• Eps Is High In 2005 Later It Started Decreasing From 36.29 To 27.92 In The Year Of 2006. In
The Next Year 2007 Also Eps Is Decreasing From 27.92 To 22.92.
• Total Assets Or Liabilities Are High In The Year Of 2005 And Later It Has Been Decreasing
In Next Year’s And Reached To The Value Of 51429.

32
 POST-MERGER ANALYSIS OF HDFC

PARTICULARS/YEARS 2010 2009 2008

NET PROFIT (LAKHS)

264870 224494 159018

EPS (%) 67.56 52.85 46.22

TOTAL ASSETS/LIABILITIES
222458.5 18320.77 133176.6
(CRORES)

350000

300000

250000
Net Profit
200000
EPS
150000
Total Assets/Total
100000 Liabilities

50000

0
2010 2009 2008

 INTERPRETATION:

• In The Above Table, The Net Profit Is Increasing Year After Year From 2008 To 2010. It Also
Shows That The Net Profits Even Before And After Merger Are In Increasing Mode Only.
• In Case Of Eps, Before Merger Its Value Is Decreasing Over The Years But After The Merger
Has Taken Place The Value Of Eps Has Started Increasing Gradually.
• The Same Has Happened In Case Of Total Assets And Liabilities Too. After The Merger, The
Value Of Total Assets And Total Liabilities Has Been Started Increasing Gradually.
33
 PRE-MERGER ANALYSIS OF CBOP

PARTICULARS/YEARS 2007 2006 2005

NET PROFIT (CRORES)

121.38 122.48 30.15

EPS (%) 0.77 0.87 0.3

TOTAL ASSETS/LIABILITIES
18482.7 11330.19 4611.68
(CRORES)

20000
18000
16000
14000
Net Profit
12000
10000 EPS
8000
6000 Total Assets/Total
Liabilities
4000
2000
0
2007 2006 2005

 INTERPRETATION:
 In The Above Table, All The Three Particulars Values Have Been Increasing Year After Year.
The Net Profit Of CBOP Has Been Increasing From 30.15 To 121.38 In Three Years.
 Eps, In The Year 2005 Is 0.3 Later It Has Been Increased To 0.87 In The Year Of 2006 And
Then It Has Decreased To 0.77 In The Year Of 2007.
 Totals Assets And Liabilities Have Been Increasing Every Year From 4611.68 In The Year 2005
To 18482.78 In The Year 2007.

34
 RECENT ANALYSIS OF HDFC BANK

PARTICULARS/YEARS 2019 2018 2017 2016 2015

NET PROFIT (LAKHS) 12801 10689

22332 18510 15280

EPS (%) 82 71.33 56.53 48.61 40.95

TOTAL
ASSETS/LIABILITIES 1292806 1103233 892463 762307 607169
(CRORES)
1400000

1200000

1000000
Net Profits
800000
EPS
600000
Total Assets/Total
400000 Liabilities

200000

0
2019 2018 2017 2016 2015

 INTERPRETATION:
 Over The Years From 2015 To 2019, The Net Profit Of HDFC Bank Has Been Increasing
Gradually. It Raised From 10689 In The Year 2015 To 22332 In The Year 2019. Here It Can
Be Observed Even Before And After Merger The Value Of Net Profit Has Been In Stage Of
Increasing Only.

35
  TREND ANALYSIS OF HDFC IN LAST 10 YEARS

Years Net Profit

2010 3004
2011 3992
2012 5247
2013 6870
2014 8743
2015 10689
2016 12801
2017 15280
2018 18510
2019 22332

25000

20000

15000
Years
10000 Net Profit

5000

0
1 2 3 4 5 6 7 8 9 10

Graphical Representation Of Net Profits Of HDFC Bank For 10 Years

 INTERPRETATION:
 The Above Graph Represents The Trend Analysis Of HDFC Bank For 10 Years. X- Axis
Represents Number Of Years And Y- Axis Represents Net Profit Values.
 In The Above Graph Red Line Represents Net Profits And Blue Line Represent Liner Trend Line.
 The Graph Slopes Upward Left To Right Which Indicates That Net Profit Is Increasing Year By
Year.

36
 Years EPS
2010 12.72
2011 16.63
2012 21.66
2013 27.93
2014 35.26
2015 40.95
2016 48.61
2017 59.53
2018 71.33
2019 82
FIGURE 6:

90
80
70
60
50
Years
40
EPS
30
20
10
0
1 2 3 4 5 6 7 8 9 10

Graphical Representation Of EPS Of HDFC Bank

For 10 Years

 INTERPRETATION
 The Above Graph Represents The Trend Analysis Of HDFC Bank For 10 Years.
 X- Axis Represents Number Of Years And Y- Axis Represents EPS Values.
 In The Above Graph Blue Line Represents EPS Values And Red Line Represents EPS Trend Line.
 Even The Slope Of EPS Is Also Upward Left To Right Indicating That The Values Are Increasing
Every Year.

37
 EFFECT OF MERGER AND ACQUISITION OF HDFC AND CBOP BANK:
 HDFC Bank's Ability To Grow At Over 30 Per Cent Annually In The Last Nine Years, Along
With Superior Credit Risk Management Practices, Which Have Helped It Maintain Asset
Quality, Would Ensure That It Will Be Among The Least Affected In A Slowdown.
 The Bank's Focus On Technology And Superior Margins With Support From Low-Cost
Deposits Will Ensure Profitable Growth In The Future.
 The Merger Of Retail Focused-Centurion Bank Of Punjab (CBOP) With HDFC Bank Effective
May 23, 2008, Will Shore Up Revenues In The Medium-Term.
 However, The Synergies From The Merger With Start Reflecting Over 12-24 Months, And
Boost Profitability.
 Put Together, The Gains From Organic And Inorganic Initiatives Will Help The Bank Sustain
Growth Rates In Excess Of Its Historical Average Of 29-30 Per Cent, And In A Profitable
Manner.
 The Inherent Synergies Of HDFC Bank And CBOP In Their Retail Focus Was The Driver For
The Merger, Which Added Around 400 Branches To HDFC Banks' Branch Strength Of 760 (As
On March 2008) Along With A 15-20 Per Cent Increase In The Asset Base To More Than Rs
1.7 Lakh Crore.
 While The Merger Has Helped Increase The Size Of HDFC Bank, It Has Also Led To Some
Pressure On Key Ratios For The Combined Entity; CBOP Ratios Were Lower Than That Of
HDFC Bank.
 The Next Pertinent Question Is The Pace Of Integration, And How Fast HDFC Bank Can Ramp
Up Efficiency Levels Of CBOP To Its Own Benchmarks.
 The Integration Plan Is On Schedule. The Re-Branding Of CBOP Was Completed In May Itself;
Training Processes To Assign All The Employees Of CBOP In Their New Roles Is Marching
Ahead With Almost 90 Per Cent Of The People Retrained.
 With Regards The Systems, Treasury, Wholesale Banking And Retail Loan Segments, They
Have Already Been Integrated With HDFC's Platform, While The Overall Retail Banking Is
Expected To Be Completed In The Next Two Months.

38
 BENEFITS OF HDFC AND CBOP MERGER:
 The Deal Created An Entity With An Asset Size Of Rs 1,09,718 Crore (7th Largest In India),
Providing Massive Scale Economies And Improved Distribution With 1,148 Branches And 2,38
ATM’s (The Largest In Terms Of Branches Within The Personal Sector).
 CBOP’s Strong SME Relationships Complemented HDFC Banks Bias Towards High Rated
Corporate Entities.
 CBOP Management Had Relevant Experience With Larger Banks (As Evident In The Centurion
Bank And BOP Integration Earlier) Managing Business Of The Size Commensurate With HDFC
Bank.
 For CBOP, HDFC Bank Would Exploit Its Underutilized Branch Network That Had The
Requisite Expertise In Retail Liabilities, Transaction Banking And Third Party Distribution.
 The Combined Entities Of HDFC-CBOP Would Improve Productivity Levels Of CBOP
Branches By Leveraging HDFC Banks Brand Name.
 For HDFC Bank, This Merger Would Provide An Opportunity To Add Scale, Geography
(Northern And Southern States) And Management Bandwidth. In Addition, There Exists A
Potential Of Business Synergy And Cultural Fit Between Two Organizations.

ADDITIONAL BENEFITS

39
 CHAPTER V- FINDINGS,SUGESTIONS,CONCLUSION

 FINDINGS:
 The Primary Objective Behind The Idea Of Merger Is To Attain Growth At The Strategic Level
In Terms Of Size And Customer Base. This, In Turn, Will Increase The Credit-Creation
Capability Of The Incorporated Bank Staggeringly.
 The Main Reason Behind Merger Is, HDFC Bank Was Looking For An Appropriate Merger
Opportunity That Would Add Scale, Geography And Experienced Staff To Its Franchise. The
Bank Believes That CBOP Bank Of Geographic Area Would Be The Correct Slot In Terms Of
Culture, Strategic Intent And Approach To Business.
 The Combined Entity Of HDFC-CBOP Would Have A Nation-Wide Network Of 1,148
Branches, The Largest Among Private Sector Banks, A Strong Deposit Base Of Around Rs.
120,000 Crore And Net Advances Of Around Rs. 85,000 Crore. The Balance-Sheet Size Of The
Combined Entity Would Be Over Rs. 150,000 Crore.
 As Of 30 September 2017, The HDFC Bank's Distribution Network Was At 4729 Branches And
12259 Atms Across 2669 Cities And Towns.
 The Swap Quantitative Relation For Merger Is Around 29 Shares Of Re 1 Of CBOP; An
Investor Will Get One Share Of Rs 10 Of HDFC Bank.
 In The Year 2014, HDFC Bank First Lunched The Missed Call Banking Service Allowing
Customers To Use Banking Services Without Having To Visit The Bank Or Connect Online.
 On 16 June 2015 HDFC Bank Launched The 10-Second Personal Loan Approval Service
Thereby Becoming The First In The Retail Lending Space To Fully Automate The Process Of
Loan Approval And Disbursement.
 In 2016 HDFC Bank Introduced Loans At Atms As The Country's First Innovation To Turn
Atms Into Loan Dispensing Machines (Ldms) Further Extending The Functionality Of The
Bank's Atms.
 In Recent Times, India Has Witnessed Entry Of Many International Banks Like CITI Bank, YES
Bank Etc Which Posses An External Entrant Threat To HDFC Bank – As This Banks Are
Identified For His Or Her Art Of Operating And Maintain High Standards Of Client Service.

40
 SUGGESTIONS:

 If Compared With The EPS Of Other Private Sector Banks, HDFC Bank Has The Highest
Earnings Per Share With A Max Price Of 80.62. So It Suggested Maintaining The Same
Position In The List Of Highest EPS By Following Good Techniques And Standards.

 The P/E Of HDFC Bank Was Decreased After The Merger, So The Bank Requires
Concentration On Policy More Attractive So As To Create Interest Among Investors In The
Stock.

 HDFC Bank Stands With 4,729 Branches And 12,259 Atms Across The World. But If
Observed SBI Stands In First Position Holding 16,333 Branches And 54,560 Atms, So It Is
Suggested That HDFC Bank Can Explore Its Business By Increasing More Number Of
Branches To Increase Its Productivity.

 CONCLUSION:

Firstly, Merger Is The Useful Tool For Growth And Expansion In Indian Banking Sector. It Is
Useful For Survival Of Weak Banks By Merging Into Larger Bank. This Study Shows That
Impact Of Merger On Monetary Performance Of Indian Banking Sector. For This The Largest
Merger In The Private Banking Sector I.E. Merger Of HDFC And CBOP Banks Has Been
Chosen. It Laid Down A Comparison In Between Pre And Post Merger Performance Examined
In Terms Of Net Profit Margin, Earnings Per Share (Eps), Trend Analysis For 10 Years Of Net
Profit And Eps Data Has Shows The Improvement After The Merger As Specified For The
Purpose And Objective Of The Study. The Most Important Thing Is To Notice The Actual
Success Of Merger Is Laid At Generating Net Higher Profit After The Merger In Order To
Justify The Decision Of Merger Undertaken By The Management To The Shareholders. Having
A Sight On Data Analysis, It Can Be Noticed That In Pre And Post Merger Data The Post
Merger Data Results Are Satisfactory. It Is Ended That The Monetary Performance Of Bank Has
Accumulated Once Merger.

41
 BIBLOGRAPHY:

 R. Saluja, S. Sharma,R. Lal “Impact of Merger on financial performance of Bank- A Case study

of Hdfc Bank” International Journal of Research in Finance & Marketing, Vol. 2, No. 2,pp. 313-

326

 UNCTAD: Impact of cross-border mergers and acquisitions on development and policy issues

for consideration, note by UNCTAD secretariat (TD/B/COM.2/EM.7/2,8 June 2000)

(http://unctad.org/en/docs/c2em7d2.en.pdf)

 BBC News Online: Banking on size to compete (http://news.bbc.co.uk, 7 Feb. 2000).

 Sherman Andrew J, “Merger and acquisition from A to Z” ,AMACOM ; 2011,pp.

 http://www.livemint.com/Home-Page/w5I98u8oIRffQUgHbCNxPM/CenturionBank-of-Punjab-

posts-quarterly-profit-ofRs28-cror.html

 http://www.wikinvest.com/stock/HDFC_Bank_LTD_Ads_%28HDB%29/

Merger_Centurion_Bank_Punjab_Limited

 https://www.moneycontrol.com/stocks/marketinfo/eps/nse/bankprivate.html?classis=true

 https://shjtdxxb-e.cn/wp-content/uploads/2020/07/JSJ.U-2307.61-F.pdf

 file:///C:/Users/riyat/Downloads/36790375-Bank-Merger-and-Acquisition.pdf

 file:///C:/Users/riyat/Downloads/52893843-mergers-and-acquisitions-in-indian-banking-

sector.pdf

 https://archive.mbda.gov/news/blog/2012/04/5-types-company-mergers.html

 https://blog.ipleaders.in/mergers-and-acquisitions-in-the-banking-sector-of-india/

 https://web.archive.org/web/20060321104218/http://www.centurionbop.co.in:80/

 https://www.globalscientificjournal.com/researchpaper/

A_CASE_STUDY_ON_MERGER_OF_HDFC_CBOP.pd

 https://blog.ipleaders.in/mergers-and-acquisitions-in-the-banking-sector-of-india/

42
TOPIC-2
{PPT ON STRUCTURE AND WORKING OF IRDA}

43
44
45
46
47
48
49
 TOPIC-3
{COMPARATIVE STUDY OF FINANCIAL PERFORMANCE OF ONE PROIVATE AND
ONE NATIONALISED BANK}

50