!

MAJOR RESEARCH PROJECT

On

A COMPARATIVE STUDY OF CONSUMER SATISFACTION TOWARDS STATE

BANK OF INDIA & ICICI BANK

Submitted to

Devi Ahilya University, Indore

For partial fulfilment of the requirement for the Degree of

Master of Business Administration (International Business)

Batch 2019-21

Guided by: Submitted by:

Mr. Sanju Mahawar Harshvardhan Singh Tomar

IBMR, IPS ACADEMY


Rajendra Nagar, A.B. Road, Indore – 452012 (MP)
 PREFACE

The bookish knowledge of any program, which we get from educational institutions, is not enough to be
used in our day-to-day life. The more practical knowledge we have, the more beneficial it is for our
learning.

To make the students aware of the working of the business world every student of MASTER OF
BUSINESS ADMINISTRATION (INTERNATIONAL BUSINESS) - IV SEMESTER has to undergo a
major research project where he/she experiences many aspects of business under the supervision of
Professional Managers.

I strongly believe that the knowledge gained from this experience is more than the knowledge gained
from the theories in the book.

PLACE: INDORE

Harshvardhan Singh Tomar

Student Name

DATE:
 CERTIFICATE

This is to certify that Ms/Mr Harshvardhan Singh Tomar Student of Institute of

Business Management and Research, IPS Academy, Indore of MBA (International
Business) program has prepared Major research Project report on topic “A
COMPARATIVE STUDY OF CONSUMER SATISFACTION TOWARDS STATE BANK
OF INDIA & ICICI BANK” under my guidance.

Internal Examiner (Guide) External Examiner

Director
IBMR, IPS Academy
 STUDENT DECLARATION

I Harshvardhan Singh Tomar Student of Institute of Business Management and

Research, IPS Academy, Indore of MBA (International Business) program has
prepared Major research Project report on topic “A COMPARATIVE STUDY OF
CONSUMER SATISFACTION TOWARDS STATE BANK OF INDIA & ICICI BANK”.

The Research as per my knowledge is original and genuine and not published in
any research Journal previously.

Harshvardhan Singh Tomar

Student Name & Signature

MBA (IB) (3th sem)

2019-21
 ACKNOWLEDGEMENT

I often wondered why the project reports always began with acknowledgement. Now, when I
have undertaken project myself, did I realize that project report involves not just the researcher
but so many people that help in making the research possible. Therefore, I take pleasure in
beginning the most beautiful part of the report.

I fall short of words to express my gratitude to my guide Dr./Ms/Mr .Prof……….. and Dr./Mr/
Ms. Prof…………. who despite their busy schedule were able to find some time to guide me
through trouble and solve my problems to the best of abilities. Without their unfailing guidance,
encouragement, and patience this project would not have been possible. It has been a learning
experience under him/her.
I am thankful to my faculty guide Prof. Mr Sanju Mahawar who gave me detailed instructions
during my MRP.
A COMPARATIVE STUDY OF CONSUMER TOWARDS
STATE BANK OF INDIA & ICICI BANK

INTRODUCTION:
The banking sector is very important for the economic development of a country. Traditionally
the banks worked as finance depositor and finance provider only but presently as the scenario
have changed and many policies and other technical changes have become the part of economies
therefore now banks also play many roles in the development of economy. The study is an attempt
to analyze the financial performance of SBI and ICICI banks. The State Bank of India, popularly
known as SBI is one of the leading bank of public sector in India. SBI has 14 Local Head Offices
and 57 Zonal Offices located at important cities throughout the country. ICICI bank is the
second largest, leading bank of private sector in India. The Bank has 2,533 branches and 6,800
ATMs in India.

The study is descriptive and analytical in nature. The collected data was secondary in nature
and collected from various reports issued by these banks through internet. The comparison of
financial performance of these two banks was made on the basis of ratio analysis. The results
indicated that the SBI is performing well and financially sound than ICICI Bank. Also the market
position of SBI is better than ICICI in terms to earning per share, price ratio per share and
dividend payout ratio, but on the other hand ICICI bank is performing well in terms of NPA and
provision for NPA in comparison of SBI bank.

Banking sector is backbone of economy in the country. The finance collected from this sector
works in economy as blood works in the body. The banking sector is characterized by various
services such as account facility, ATM facility, loan facility, mutual fund facility and many other
financial services.

These services help a citizen to facilitate his/her work life and private life in many ways. In
India the banking sector is witnessed various changes after liberalization and globalization.
These changes mould and change the structure of banking system. After globalization many
banks has entered in India and has gave tough competition to the existing banks in India. In
India few public and few private sector banks were operating since conceptualization of this
sector but now they have to face severe competition from the foreign banks to sustain in the
market and consequently many amendments were made by these domestic players to attract
customers. Though the „own country bank‟ factor has played important role in the sustainment
of these domestic banks because customers can easily rely on these banks and undoubtedly want
to transact and make relations with domestic banks. Due to this reason, presently as well many
foreign banks has stepped into our country but still not well established.

The new generation is open minded in terms of new change and want to avail new facilities
offered by foreign banks therefore preferring the foreign banks over domestic banks and now
gradually the way of foreign banks is becoming easier in India. But the present study is focusing
on the domestic banks and tries to study the financial performance of domestic banks to present
the picture before the masses by comparing the public and private sector banks so that the
investors, bankers, customers and government can see the insight of domestic banks to make the
relation with these banks in future. For this purpose one private bank i.e. ICICI and one public
sector bank i.e. SBI have been taken to study the financial performance on the basis of ratio
analysis.

As SBI is one of the leading public sector banks in India and ICICI is the second largest and
leading bank of private sector in India. Apart from this the NPA to advance comparison between
these two banks was also made to depict the picture of debtors which has turned to bad debts for
these banks. The total income depiction of both banks was also made through graph to show the
income earning position of the banks. In addition to this, market test ration was also calculated
to present the market position of banks in terms of earning per share, price earning ration and
dividend payout ratio.

Product and services offers by bank

(i) Deposits : A Bank accepts deposits from the public. People can deposit their cash balances in
either of the following accounts to their convenience.

(ii) Fixed Deposits: Cash is deposited in this account for a fixed period. The depositor gets
receipts for the amount deposited. It is called fixed deposit receipt. The receipt indicates the
name of the depositor, amount of deposit, rate of interest and the period of deposit. This receipt is
not transferable. If the depositor stands in need of the amount before the expiry of fixed period,
he can withdraw the some after paying the discount to the bank.

(iii) Savings Account : This type of deposit suit those who just want to keep their small savings in
a bank and might need to withdraw them occasionally. Banks provide a certain rate of interest
on the minimum balance kept by the depositor, during the month.

(iv) Current Account :Current bank account is opened by businessmen who have a higher
number of regular transactions with the bank. It includes deposits, withdrawals, and contra
transactions. It is also known as Demand Deposit Account. Current account can be opened in
co-operative bank and commercial bank.

(v) Loans Facility : Loans are granted by the banks on securities which can be easily disposed
off in the market. When the bank has satisfied itself regarding the soundness of the party a loan
is advanced.

(vi) Credit Cards : All Banks (except the Swiss Bank) provide VISA and Master card cards that
enable individuals to make payments over the Internet or in shops.

(vii) Mobile Banking: Mobile Banking (also known as M-Banking, embanking, SMS Banking
etc.,) is a term used for performing balance checks, account transactions payments etc., via a
mobile devices such as a mobile phone. Mobile banking today 2018 is most often performed via
SMS or the Mobile Internet but can also use special programs called clients downloaded to the
mobile device.

(viii) Internet Banking: Online banking (or Internet banking) allows customers to conduct
financial transactions on a secure website operated by their retail or virtual bank, credit union
or building society.

(ix) Core Banking System : Core Banking is a general term used to describe the services
provided by a group of networked bank branches. Bank customers may access their funds and
other simple transactions from any of the member branch offices etc.

HISTORY OF SBI:

Stamp dedicated to the State Bank of India in 2005

Share of the Bank of Bengal, issued 13 May 1876

Seal of Imperial Bank of India

The roots of State Bank of India lie in the first decade of the 19th century when the Bank of
Calcutta later renamed the Bank of Bengal, was established on 2 June 1806. The Bank of Bengal
was one of three Presidency banks, the other two being the Bank of Bombay (incorporated on 15
April 1840) and the Bank of Madras (incorporated on 1 July 1843). All three Presidency banks
were incorporated as joint stock companies and were the result of royal charters. These three
banks received the exclusive right to issue paper currency till 1861 when, with the Paper
Currency Act, the right was taken over by the Government of India. The Presidency banks
amalgamated on 27 January 1921, and the re-organised banking entity took as its name Imperial
Bank of India. The Imperial Bank of India remained a joint-stock company but without
Government participation.
Pursuant to the provisions of the State Bank of India Act of 1955, the Reserve Bank of India,
which is India's central bank, acquired a controlling interest in the Imperial Bank of India. On 1
July 1955, the Imperial Bank of India became the State Bank of India. In 2008, the Government
of India acquired the Reserve Bank of India's stake in SBI so as to remove any conflict of interest
because the RBI is the country's banking regulatory authority.

In 1959, the government passed the State Bank of India (Subsidiary Banks) Act. This made eight
banks that had belonged to princely states into subsidiaries of SBI. This was at the time of the
First Five Year Plan, which prioritised the development of rural India. The government
integrated these banks into the State Bank of India system to expand its rural outreach. In 1963
SBI merged State Bank of Jaipur (est. 1943) and State Bank of Bikaner (est.1944).

SBI has acquired local banks in rescues. The first was the Bank of Bihar (est. 1911), which SBI
acquired in 1969, together with its 28 branches. The next year SBI acquired National Bank of
Lahore (est. 1942), which had 24 branches. Five years later, in 1975, SBI acquired Krishnaram
Baldeo Bank, which had been established in 1916 in Gwalior State, under the patronage of
Maharaja Madho Rao Scindia. The bank had been the Dukan Pichadi, a small moneylender,
owned by the Maharaja. The new bank's first manager was Jall N. Broacha, a Parsi. In 1985,
SBI acquired the Bank of Cochin in Kerala, which had 120 branches. SBI was the acquirer as its
affiliate, the State Bank of Travancore, already had an extensive network in Kerala.

There was, even before it actually happened, a proposal to merge all the associate banks into SBI
to create a single very large bank and streamline operations.The first step towards unification
occurred on 13 August 2008 when State Bank of Saurashtra merged with SBI, reducing the
number of associate state banks from seven to six. On 19 June 2009, the SBI board approved the
absorption of State Bank of Indore, in which SBI held 98.3%. (Individuals who held the shares
prior to its takeover by the government held the balance of 1.7%.)

The acquisition of State Bank of Indore added 470 branches to SBI's existing network of
branches. Also, following the acquisition, SBI's total assets approached ₹10 trillion. The total
assets of SBI and the State Bank of Indore were ₹9,981,190 million as of March 2009. The
process of merging of State Bank of Indore was completed by April 2010, and the SBIndore
branches started functioning as SBI branches on 26 August 2010.
On 7 October 2013, Arundhati Bhattacharya became the first woman to be appointed
Chairperson of the bank.Mrs. Bhattacharya received an extension of two years of service to
merge into SBI the five remaining associate banks.

HISTORY OF ICICI:

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 in Vadodara. The
parent company was formed in 1955 as a joint-venture of the World Bank, India's public-sector
banks and public-sector insurance companies to provide project financing to Indian industry.
The bank was founded as the Industrial Credit and Investment Corporation of India Bank, before
it changed its name to ICICI Bank. The parent company was later merged with the bank.

ICICI Bank launched internet Banking operations in 1998.ICICI's shareholding in ICICI Bank
was reduced to 46 percent, through a public offering of shares in India 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 a financial institution from
non-Japan Asia to be listed on the NYSE.

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 the
Reserve Bank of India in April 2002.

In 2008, following the 2008 financial crisis, customers rushed to ICICI ATMs and branches in
some locations due to rumours of an adverse financial position of ICICI Bank. The Reserve Bank
of India issued a clarification on the financial strength of ICICI Bank to dispel the rumours.In
March 2020, the board of ICICI Bank Ltd. approved an investment of Rs 1,000 crore in Yes Bank
Ltd. This investment resulted in ICICI Bank Limited holding in excess of a five percent
shareholding in Yes Bank.

REVIEW OF LITERATURE:

The banking system of India is featured by a large network of bank branches, serving many kinds
of financial services of the people. The State Bank of India, popularly known as SBI is one of the
leading bank of public sector in India. ICICI Bank is second largest and leading bank of private
sector in India. The present study is conducted to compare the financial performance of SBI and
ICICI Bank on the basis of ratios such as credit deposit, net profit margin etc.The study found
that SBI is performing well and financially sound than ICICI Bank but in context of deposits and
expenditure ICICI bank has better managing efficiency than SBI.

Financial health of a bank is the guarantee not only to its depositors but is equally significant for
the shareholders, employees and whole economy as well. As a sequel to this maxim, efforts have
been made from time to time, to measure the financial position of each bank and manage it
efficiently and effectively. In this paper, an effort has been made to evaluate the financial
performance of the two major banks operating in northern India .This evaluation has been done
by using CAMEL Parameters, the latest model of financial analysis. Through this model, it is
highlighted that the position of the banks under study is sound and satisfactory so far as their
capital adequacy, asset quality, Management capability and liquidity is concerned.

A study of customers of public sector banks in India. In which they mainly focus on the primary
opinion of the customers of these banks. The State Bank of India (SBI) is selected as the
representative of the public sector banks and HDFC, ICICI, IDBI and UTI as representatives of
the new private sector banks.. It is evident from the study that the customers of private banks are
more satisfied than those of the SBI. Customers of the SBI are more sensitive with regard to the
processing time taken for account handling and technological updates. The researcher finds that
Dissatisfaction in those areas can lead to a shift to other banks, while proximity to residence and
sometimes, delay in processing time can be a reason for changing the existing bank for a new
one in the case of private bank customers. Customers of private banks are more satisfied than
those of the SBI. In prompt services private banks have little edge over the SBI, and
technologically customers of private banks.

Customer satisfaction with service quality-An empirical study of public and private sector banks
Which compares customers‘ perceptions of service quality of public and private banks of
Jammu? The service quality of both the banks has been measured using SERVQUAL (service
quality) scale. It was found that customers of public sector banks are more satisfied with the
service quality, than those of private sector banks. The results of the study indicate that
tangibility and reliability provides Maximum satisfaction to customers of private as well as
public sector banks. Superior SERVQUAL performance will ensure maximum customer
satisfaction and also help in attaining customer‘s loyalty. Improved customer satisfaction
through SERVQUAL would result in a positive word-of-mouth and consequently better customer
acquisition and retention.

Kusum W. Ketkar, Venderbilt University in her article performance and profitability of Indian
banks in post reform Period explained the technique of DEA (data envelopment analysis) has
been used after deriving efficiency of each institution by using comparable mix inputs. The
researcher concludes that a high percent of officers in their workforce has added to their
efficiency. Excessive bank investment in government securities has negatively impacted bank
efficiency. Such overdependence on government securities by public sector banks is an indication
of their risk- averse behavior. Finally, the new MSI variable developed to measure the income
environment facing each bank is found to be quite relevant in explaining lower efficiency scores
of state-owned and nationalized banks.

B S Bodla and RichaVerma Bajaj an analysis of private sector banks in India the Production
approach of Data Envelopment Analysis (DEA) was applied to judge the efficiency of private
sector banks. In this model, banks are considered as service providers, and while interest
expenses, non-interest expenses and the Non-Performing Asset (NPA) ratio. Therefore, it can be
inferred that the position of private banks is greatly affected by the output variables; And On the
whole, HDFC Bank was the top performer with an average productivity score of 414.56%,
followed by ICICI Bank. Centurion Bank (64.17%) was the most in efficient bank among the
private sector banks during the study period. Based on the above findings, it can be said that the
efficiency of private sector banks was acceptable during the study period.

Usha, Damodar Suarb and Pratap K.J. Mohapatra in Customer satisfaction in Indian
commercial banks through total quality management approach study examines whether soft and
hard aspects of quality management practices determine service quality and customer
satisfaction. A conceptual model depicting the relationship was applying structural equation
modeling. Results reveal that transformational leadership, workplace spirituality and service
climate, depicting the soft aspects of quality management practices, do increase employees ‘job
satisfaction and affective commitment. Management information system and physical evidence
depicting hard aspects of quality management practices enhance service quality.
The study reveals that not only the information and analysis, but also the quality of the system,
quality of information and efficiency of managers in using those technologies are important for
providing better services to customers.

ManojP.K, Determinants of Profitability and Efficiency of Old Private Sector Banks in India
with Focus on Banks in Kerala State: An Econometric Study paper which Focuses on the OPBs
based at Kerala state (KOPBs) in the Indian union, this paper seeks to identify the determinants
of profitability and operational efficiency of KOPBs, using an econometric methodology. For the
sake of comparison of KOPBs, the general case of OPBs and New generation Private sector
Banks (NPBs) in India have also been analyzed. Their study results that priority sector advances
are do not affect either profitability or risk management adversely, as against the popular belief
in this regard. The strategies as above have got special significance in respect of OPBs in
general and KOPBs in particular in the ongoing globalized regime of fierce industry
competition; because higher profitability, and strong risk management capability are vital for
these banks for survival and growth.

Jaspal Singh and Gagandeep Kaur Determinants of Customer Satisfaction: An Empirical Study
of Select Indian (Universal) Banks in which they investigate the determinants of customer
satisfaction of Indian (Universal) banks. Data was collected from a sample of 180
respondents using convenience sampling technique. Factor analysis results reveals that
responsiveness, tangibles, services innovation, reliability and accessibility, assurance, pricing
and other facilities, problem solving capability and convenient working hours are the main
determinants of customer satisfaction. Their result shows that customer satisfaction is influenced
by nine factors, namely, Responsiveness, tangibles like appearance of a bank‘s physical facilities
equipment and employees, Reliability 40 and accessibility, assurance, pricing and other
facilities, problem solving capability and convenient working hours of bank.

G Santhiyavalli and b. Sandhya in Service Quality in Service Quality Evaluation in Select

Commercial Banks: A Comparative Study which evaluates the service quality of select leading
commercial banks by identifying the major factors responsible for customer satisfaction. To
support the objective of the study, SERVQUAL technique, based on the model developed by
Valarie Zeithaml was adopted. The factor analysis clearly indicates that among the five
dimensions assurance‘, tangibility ‘and reliability ‘are the major factors responsible for
customer satisfaction which stood at 74% with regard to the services provided by ICICI Bank.
State Bank of India (SBI) scored 94% on customers ‘satisfaction in respect of reliability
‘responsiveness‘, empathy and tangibility. The findings of the study reveal that the service
quality of SBI is much better than the services offered by the ICICI Bank. Based on the services
offered by the SBI, reliability ‘responsiveness’ empathy ‘and tangibility ‘are the dimensions
which stood at 94% on customer satisfaction.

Sonia Chawla and Ritu Sehgal An Empirical Analysis of the Awareness and Satisfaction Level of
Internet Banking Users with Respect to Demographic Profile, This study is an attempt to explore
the sources of awareness regarding Internet banking and usage of Internet banking services. The
study also assesses the satisfaction level of the respondents on the basis of their demographic
profile across the public and private sector banks. The data was collected from 120 respondents
belonging (SBI), (PNB) and among the public sector banks, and (ICICI) Bank, (HDFC) Bank
and Axis Bank among the private sector banks in the state of Punjab The study reveals that age
has a statistically significant effect on the choice of a particular bank. Income also has a
significant influence on the number of banks used. Their findings say that the satisfaction level
can be improved with some more efforts of the banks by providing Internet banking services as
per the users ‘expectations.

Dr Biranchi Swar Managing Customers‟ Perceptions and Expectations of Service Delivery in

Selected Banks in Odisha, This study was conducted among six banks of Odisha, viz., State Bank
of India (SBI) & Punjab National Bank(PNB) in public sector banks being the largest and oldest
banks in India, ICICI Bank and Axis Bank in the private sector banks being the 2nd largest bank
and most successful bank in India, and Citibank and Standard Chartered Bank having the
maximum operations in India among the foreign banks. For this study service delivery (Human
element and Systemisation element) is taken as an independent variable to provide better
customer service quality,. A sample of 524 useable questionnaires of customers has been
analyzed. It has been found that as far as customers ‘perceptions of service delivery are
concerned human element of service delivery’ is the most important dimension, followed by
systemisation element of service delivery respectively.

Navinkumar Mishra and Vijaykumar Pandey in their paper “customer satisfaction –A

comparison of public and private sector banks of India in which research is done to compare
public and private sector banks of India by evaluating their customer satisfaction. This research
is mainly based on primary data which has been collected through a well-structured
questionnaire (adapted from three different studies). The questionnaire has been distributed to
350 different respondents on different chosen locations. This paper makes a useful contribution
as there are very low number of studies has been conducted in India on such areas like price,
technology, reliability, Their finding says that most of people prefer to deal with public sector
banks due to safety and reliability factors.

Samad (2007) in his paper entitled, “Comparative Analysis of Domestic and Foreign Bank
Operations in Bangladesh” examines the operations of foreign and domestic banks in the
process of industrialization and economic development of Bangladesh.

Shobana (2010) in his paper entitled, “Operational Efficiency of Public Sector Banks in India- a
Non-Parametric Model” focuses on the operational efficiency of public sector banks in India
using a non-parametric model, which measures the efficiency as a ratio of output index to input
index. The study concluded that out of 27 public sector banks in India, only nine banks has
achieved high level of efficiency in its operations.

Dr. Anurag. B. Singh and Priyanka Tandon (2012) in their research paper entitled, “A
comparative Study on Financial Performance of State Bank of India and ICICI Bank” examined
the financial performance of SBI bank and ICICI bank, Public sector and Private sector
respectively. The data used for this study was secondary in nature. The study was conducted to
determine the financial performance of SBI and ICICI banks on the basis of ratios such as credit
deposit, net profit margin etc.In this study, it was found that SBI is performing well and
financially sound than ICICI bank but in context of deposits and expenditures, ICICI bank has
better managed than SBI bank.

Devi (2017) in their paper entitled “A Study on the Financial Comparison between SBI and
ICICI with reference to Chennai Annanagar Branch” examined the performance of the banks
from 2012-2017. Operating ratio, debt equity ratio were taken as the variables. It was examine
that operating profit ratio of SBI was better than ICICI.

Ali Ataullah (2004) Concluded that there is still room for improvement in the efficiency of banks
in both the countries. A step forward for the liberalization programmer , therefore, is not only to
deregulate interest rates and enhance the level of competition but also to strengthen the
institutional structure to support good practices in the banking industry .
Gupta Sumeet & Verma Renu (2008) concluded that management of non-performing assets and
risk emanating from adverse event is the key to higher profitability of the Indian banking.
Transparency and good governance would work as principal guiding force in present scenario.

GhoshSaibal (2009) concluded that with international standards, Indian banks would need to
improve their technological orientation and expand the possibilities for augmenting their
financial activities in order to improve their profit efficiency in the near future.

Dr. Ibrahim Syed M (2011) concluded that this is diagnostic and exploratory in nature and makes
use secondary data. The study finds and concludes that the scheduled commercial banks in India
have significantly improved their operational performance.

Dr. Pardhan Kumar Tanmaya (2012) Concluded that-The study is based on primary data. The
data has been analyzed by Percentage method. The tool used to collect data from the bank
officials was a structured questionnaire. Responses obtained from the 50 Bank managers / senior
officers.
Dr. Dhanabhakyam M &Kavitha M. (2012) studied that banks have to re-orient their strategies
in the light of their own strength and the kind of market in which their likely to operate on. In the
perspective of this domestic and international development, the banking sector has to chart
perfect for development.

Gupta Shipra (2012) concluded that- Public and Private sector banks both are giving good
service in India .Financial condition of any bank is measured by the help of financial ratio. A
leverage ratio cannot do the job alone it needs to be complemented by other prudential tools or
measures to ensure a comprehensive picture of the buildup of leverage in individual banks or
banking groups as well as in the financial system.

Sharma Esha (2012) concluded that- The liberalized policy of the govt. of India permitted entry
to the ICICI in the banking; the industry has witnessed a generation of private players. That’s
why the present paper special emphasis has been laid down on the financial analysis of the bank
by using different research ant statistical tools.

Gejalakshami Sandanam & et.al (2012) , Cocluded that the public sector banks performed
remarkably well during the period than that of the private sector banks the overall regression
analysis show that the financial performance of the banking industries strongly .

GoelCheenu & Rekhi Bhutani Chitwan (2013) concluded that the analysis supports that new
banks are more efficient than old ones. The public sector banks are as not profitable as other
sectors are. It means that efficiency and profitability are inter related.

Davda V. Nishit (2012) Concluded that a review of fundamental analysis research in accounting
the paper has outlined the development of different accounting valuation model and reviewed
related emperical work .

Dr. KoundalVirender (2012) concluded that although various Reforms have produced favorable
effects on commercial banks in India and because of this transformation is taking place almost in
all categories of the banks.

Sai Naga Radha V & et.al. (2013) concluded that net profit margin, operating profit margin,
return on capital employed, return on equity and debt equity ratio there is no significant
difference in these ratios before after merger. Significant difference with respect to gross profit
margin.
Mishra Kumar Ashwini & et.al. (2013) Concluded that DEA provide significant insights on
efficiency of different banks and places private sector ones at an advantage situation and there
by hints out the possibility of further improvisation of most of the public sector banks.

Kamraj K. & Somu A. (2013) Conclude that Indian overseas bank is one of the oldest
nationalized commercial banks in India. Banking industry is an indicator of for many
development activities in the nation. Indian overseas bank has higher potential to provide better
and quality services to the billions of people in India.

Samir & Deepa (2013) Concluded that this analysis the position of NPAs in selected banks SBI,
PNB & Central bank of India. It also highlights the policies pursued by the banks to tackle the
NPAs and suggest a multi-pronged strategy for speedy recovery of NPAs in banking sector.
SelvamPaneer (2013) Concluded that-The Present study was aimed to analyze the financial
assistance of nationalized bank in India .To identify the relative performance of the operational
variables the linear and compound growth rates have been calculated . The performance of
nationalized banks followed by private sector banks is found to be higher when compared to SBI
and its associates and Foreign Banks.

Dr. Gupta R. & Dr. N.S. Shikarwar (2013) Concluded that the banking industry occupies a
unique place in a nation’s economy. A well-developed banking system is a necessary
precondition of economic development in a modern economy .the main parameters of growth in
banks are net profit growth , net assets growth , EPS growth and Reserve and surplus growth and
the results reveal that in terms of the parameters defined key words : net assets ,EPS ,
reserves ,surplus growth .

Hiralal R Desrani (2013) Concluded that scheduled bank has wide scope in India. It is
providing loans to various industries, business mans, small scale sector industries. It is very
helpful to all people who want loan.

Rohit Bansal(2014) Concluded that Federal has best price earnings ratio among other banks.
The total assets turnover ratio of federal bank shows that it keeps significantly highly assets to
meet the debt. Overall Federal bank is the most financially stable company in comparison to
others.

Dr. Tamilarasu A. (2014) concluded that mere opening of no-frill bank account is not the purpose
or the end of financial inclusion while formal financial institution must gain the trust and
goodwill of the poor through developing strong linkages with community based financial
ventures and coopratives.

Dr.Smita Shukla & Rakesh Malusare Studied that this evaluates the changes in the capital
structure and solvency position of banks by using various risk indicators for highlighting risk
profile of Indian Bank entities . This evaluates risk profile of ten public and private sector banks.

Gilbert YeboahSebe & Charles Mensah(2014) concluded that ADB’s focus on agriculture
financing is diminishing since a sector analysis of loans and advance indicates that agriculture
sector lost its first position to service sector. The Bank’s liquidity showed a downward and
slipped trend.

Ms. Shikha Gupta (2014) Concluded that it focused on operational control, profitability and
solvency etc. It aimed to analyze and compare the financial performance of ICICI banks and
offer suggestion for improvement of efficiency in the bank.

Arti Gaur & Nancy Arora(2014) Concluded that it study about the causes and consequences of
the various component of the financial statement in relation to the profitability of the bank. We
analyzed the financial stability and overall performance of SBI and study profitability of SBI.

Abdul V. Naseer (2014) Studied that – Study compares the financial performance and employee
efficiency of Indian banks during 2007-2013. Both the financial performance and employee
efficiency of foreign banks working in India are better than domestic banks and private sector
banks performance are better than the public sector banks. It is noted that the public sector bank
performance are more stable when compared to the private sector banks.

Pooja Sharma & Hemlata (2014) Concluded that - The banking mirrors the larger economy its
linkages to all sector make it proxy for what is happening in the economy as a whole. Banking
plays a silent yet crucial role in our day to day economy. The data is taken from financial reports
of both the banks for last five years ranging from 2008-09 to 2013-13. The results depicts that
ICICI Bank is performing better than SBI Bank as it is Able to generate more loans from its
deposits to the customers.

Soni Anil Kumar & Abhay Kapre, Regional rural bank play a vital role in the agriculture and
rural development of India. The Study Is diagnostic and exploratory in nature and makes use of
secondary data. The study finds and concludes that performance of RRBs has significantly
improved.

Varathan Sathiya Concluded that- In Canara bank the credit appraisal is done by the study
involves the evaluation in management, technical feasibility, financial viability, Risk analysis and
credit rating. This shows Canara bank has sound system for credit appraisal. The credit
appraisal Process carried out at Canara bank has good parameters to appraise.

Dr. Madhusudhana K. Rao(2014) Concluded that – with respect to the banking activities the
performance of HDFC is better than the SBI and for the investor who are intended for long term
investment & risk takers HDFC is better but with respect to the growth in the market for the
company price SBI is better. SBI shares value market more than HDFC.

Patel S Vijay Concluded that information has its own value but if someone wants to have better
judgment of the concern he has to analyze them. This provides guideline about analysis of
profitability ratio of krishakbharati bank.

Gul Shah (2014) concluded that the study has it limitation in term of selection of banks. The
present research work serve as a guideline to public sector banks to look up the financial
performance and make superior allocation for improving efficiency for the coming time.

ThakarshibhaiChiragLoryia (2014) Concluded that it attempt to analyze profitability of selected

public and private sector banks in India. This study which looks into three key factors which
affect the profitability analysis of Indian banking sector using mean, standard deviation, and
ANOVA model.

Nilesh P Movalia(2014) Concluded that Public sector banks is quite good compared to private
sector banks in the area of profitability debt equity , earning per share found that price earning
ration of private sector banks is high compare to public sector banks.

RATIONALE OF STUDY:

Indian banking has undergone much change due to liberalization and other reforms. The entry of
private and foreign banks made it too competitive that banks have to implement innovative and
attractive services including various promotional tools to satisfy their existing customer base.
The rapid and drastic changes in financial market after liberalization have brought banking from
urban to semi-urban and rural areas. They restructure their existing ones to remain competitive.
Advertising has created awareness about banking products and services and it is fully
incorporated in day to day life of Indians.

The increased disposable income has created new banking requirements and customers are
availing different products and services as per their desires. The per capita income of Indian
people in 1950-51 was Rs.255 which has increased to Rs.46492 in 2009-10. The entry of retail
banking has changed the life style of Indian consumers and now they can fulfill their dreams with
easy availability of bank loan.

The Centralized Banking Solution (CBS), Internet Banking and other technology based products
have created banking transactions faster. The demand of customer has increased as these
technologies provide the facility of One Nation, One Bank, One Branch and One Account
Number.

Now, a bank customer wants solution and satisfaction on each transaction. He desires attentive
and personalize service from bank with security. The present study will help in finding the impact
of market promotional activities on business growth in banking sector. The study of impact of
promotion tools on business growth in banking industry that controls more than 90 percent of the
banking business in India is an issue of serious concern to the Govt. of India and corporate
sector. It is seriously debating topic among academicians and public at large.

In consumer markets, marketing strategies are typically designed to increase the chances that
consumers will have favorable thoughts and feelings about particular products and services.
Banking organizations are trying to make fund available for purchase, develop strategies to
increase the chances that consumer will use their ATM, Debit card and credit card etc, services.
Many banks have adopted this broader perspective of integrated marketing communication
(IMC). They see it as a way to coordinate and mange their marketing communications programs
to ensure that they give customers a consistent message about the bank. IMC is one of the ‘new
generation’ marketing approaches being used by companies to better focus their efforts in
acquiring, retaining and developing relationships with customers and stakeholders.

A fundamental reason is that they understand the value of strategically integrating the various
communications functions rather than having them operates autonomously. By coordinating their
marketing communications efforts, companies can avoid duplication, take advantage of synergy
among promotional tools and develop more efficient and effective marketing communications
programs.

The move to integrated marketing communications also reflects an adaption by marketers to a

changing environment, particularly with respect to consumers, technology and media. Major
changes have occurred among consumers with respect to demographics, life styles, media use
and buying and shopping patterns. At the implementation level, this study could guide the bank
officials to strengthen their promotional activities and strive towards providing satisfactory
services to its customers. The research can act as a forerunner to take up similar studies in other
service industries. The satisfaction level of customers and employees as observed by the research
can be taken as a model for replication by other sectors too.

OBJECTIVES:

Objectives of the study the study is about comparison between two banks services with reference
to consumer preferences, so the purpose is as follows.

1. To study the Demographic profile area of the study period covered from 2014 – 2019.

2. To find out customer relationship with banks.

3. To know that how far customers are aware about various services provided by banks.

4. To know customer satisfaction about various services and process in transactions.

5. To know employees opinions about promoting services and customer dealings.

6. To know and compare overall satisfaction of customers regarding both bank services.

7. To offer suitable suggestions based on the findings of the whole study.

8.To compare the financial performance of State Bank of India and ICICI Bank.

9.To compare the SBI and ICICI in terms of profitability and managerial efficiency.

10.To offer the suggestions in order to improve the financial performance of both banks selected
for the purpose of the study.

11. Death of capable managerial manpower now and a greater nee in the future increases the
competition for available talent.

12. Continued growth and development of business, coupled with increased complexities such as
the problems of size, technology and competition, add further pressures. Unsettled political
economic and social conditions do not diminish pressures on a bank manager.

13. The need to continually press for improved banking performance to improve the quality of
service rendered by the do not customer satisfaction.

To full fill the purpose separate questionnaire are made to understand opinions. Here one
questionnaire is for customers and another is created for bank employees. In customers
questionnaire various questions like factors to keep in mind while selecting bank, bank
employees’ attitude, time taken to provide service, extra facilities, customers’ problem solutions
and other necessary questions are included. In employees questionnaire questions related to
CRM practices, communication about new services, related to commitment, complaints,
marketing of various services and other necessary details are also included.

The present study is undertaken to highlight the financial performance of SBI bank and ICICI
bank. SBI and ICICI Banks, being the best bank in India have been selected for the purpose of
the study. It rises to the level of 2nd largest bank in India in terms of net assets after merger of
ICICI with ICICI bank. It has wide range of products and services. Ratio analysis is one of the
major criteria to determine the financial performance of both banks and this study will help to
understand the financial performance of State Bank of India and ICICI Bank.

The Banks (Public and Private) have been facing stiff competition due to the entry of foreign
banks. The application or use of technology for the qualitative transformation in the process of
banking service is necessary and quite natural, since the market is competitive and the customers
are receptive. Consumerism has taken a new shape. The needs and requirements of the customers
are developing and expanding very fast. In this complex and fast changing environment, the only
sustainable competitive advantage for banks (Both public and private sector) is to give the
customer an optimum blend of technology and traditional services. Hence meeting the
competition and the customer requirements are the priorities of both public and private sector
banks and hence he focusing element in the thesis title is a comparative study of customers
preferences of the major two player competitors in banking sector, SBI and ICICI.

Testing of Hypotheses:

The following hypotheses are formulated to test and to substantiate the objectives of the study;

Null hypothesis Ho-1: There is no significant difference between the bank size of SBI and ICICI
bank

Further this hypothesis is tested between the different categories of bank size and total assets of
SBI and ICICI bank

Null hypothesis HQ-IA: There is no significant difference between SBI And ICICI bank in terms
of total assets
It is observed from the above table that the mean of return on assets of SBI is higher than that of
ICICI Bank. It implies that every asset employed in SBI gives better return than that of assets
employed in ICICI Bank.

Again it is observed that mean of credit deposit ratio of SBI is lower than that of ICICI Bank It
shows that management efficiency of ICICI Bank is better than that of SBI.
Further, it is observed that the mean of investment deposit ratio of SBI is higher than that of
ICICI Bank. It shows that SBI is much efficient in utilizing the funds than that of SBI.

Next, the Levene's Test for Equality of Variances is used to test the hypothesis. This tells us if we
have met our second assumption (the two groups have approximately equal variance on the
dependent variable). If the Levene's Test is significant (the value under "Sig." is less than .05),
the two variances are significantly different. If it is not significant (Sig. is greater than .05), the
two variances are not significantly different; that is, the two variances are approximately equal. If
the Levene's test is not significant, we have met our second assumption.

Finally, the results of the Independent Samples T-Test will be seen.

RESEARCH METHODOLOGY:

Research methodology describes the various methods to conduct the research study. It shows the
sequence of the steps which are followed in research process from beginning of the study till the
completion of the study. So, research methodology is a way to systematically solve the problem
and get insights into phenomena.

DATA COLLECTION:

Research is based on the secondary data. The required data for the study has been collected from
published annual reports of the banks and other statements prepared by the SBI and ICICI
Banks.

PERIOD OF THE STUDY:

This study covers the period of 07 years from 2010-11 to 2016-17. The period of the study is
large enough to know the performance of both banks.

TOOLS FOR ANALYSIS:

Ratio Analysis:

For the purpose of the study, following parameters have been taken:
1.Net Profit Ratio

2.Operating Profit Ratio

3.Return on shareholder’s Investment or Net Worth Ratio

4.Earnings Per Share

5.Total Assets Turnover Ratio

6.Interest Expended to Interest Earned Ratio.

DATA ANALYSIS & INTERPRETATION

NET PROFIT RATIO

Table 1

SBI
 ICICI

(RS. IN CRORES) (RS. IN CRORES)
YEAR NET NET
NET NET NET NET
PROFIT PROFIT
PROFIT SALES PROFIT SALES
RATIO RATIO
2010-11 7370 96329 7.65 5149 33082 15.56
2011-12 11707 120872 9.68 6465 41045 15.75
2012-13 14105 135691 10.39 8325 48421 17.19
2013-14 10891 154903 7.03 9810 54606 17.96
2014-15 13101 174972 7.48 11175 61267 18.24
2015-16 9950 191843 5.18 9726 68062 14.29
210979 73661
2016-17 10484 4.96 9801 13.30

7.48 16.04
AVERAGE AVERAGE

Table 1 displays that Net profit of both SBI and ICICI banks were fluctuating. The highest Net
Profit ratio of SBI was 10.39% in 2012-13 and that of ICICI bank, it was 18.24% in 2014-15,
where as the lowest Net Profit Ratio of SBI was 4.96% in 2016-17and that of ICICI, it was 13.30
% in 2016-17.

The average Net Profit Ratio of SBI is 7.48% and ICICI bank is 16.04% which implies that the
Net Profit Ratio of ICICI bank is 8.56, which is more than that of the SBI.
OPERATING PROFIT RATIO:
Table 2

SBI

(Rs. In Crores) ICICI (Rs. In Crores)
Year
Operating Net Operating Operating Operating
Profit Profit Ratio Profit Net Profit Ratio
Sales Sales
2010-1
16217 96329 16.83 7380 33082 22.31
1
2011-1
31574 120872 26.12 10089 41045 24.58
2
2012-1
31082 135691 22.90 13199 48421 27.25
3
2013-1
32109 154903 20.72 16594 54606 30.38
4
2014-1
39537 174972 22.60 19720 61267 32.18
5
2015-1
43257 191843 22.55 23863 68062 35.06
6
2016-1
50847 210979 24.10 26487 73661 35.96
7
Average 22.26 Average 29.67

Table No 2 demonstrates that the Operating Profit Ratio of both SBI and ICICI banks were
fluctuating during the period of the study. The highest Operating Profit Ratio of SBI in the year
2011-12 was 26.12% and that of ICICI bank was 35.96% in 2016-17. Where as, the lowest
Operating Profit Ratio of SBI was 20.72% in the year 2013-14 and 22.31% in 2010-11 in ICICI
bank respectively.

The average Operating Profit Ratio of SBI is 22.26% and that of ICICI bank is 29.61% which
implies that the Operating Profit Ratio of ICICI 7.35% which is more than that of SBI bank.

RETURN ON SHAREHOLDER’S INVESTMENT OR NET

WORTH RATIO: Table 3
 SBI

ICICI (Rs. In Crores)
(Rs. In Crores)
Year Net Net
Net Shareholder’s Net Shareholder’s
Profit Funds Worth Funds Worth
Profit
Ratio Ratio
2010-1
7370 64986 11.34 5149 55090 9.35
1
2011-1
11707 83951 13.94 6465 60405 10.70
2
2012-1
14105 98884 14.26 8325 66706 12.48
3
2013-1
10891 118282 9.21 9810 73213 13.40
4
2014-1
13101 128438 10.20 11175 80429 13.89
5
2015-1
9950 144274 6.89 9726 89735 10.84
6
2016-1 9801
10484 188286 5.57 99951 9.80
7
10.20 8.046
AVERAGE AVERAGE

Table No 2 demonstrates that the Return on Net worth Ratio of both SBI and ICICI banks were
fluctuating during the period of the study. The highest Return on Net Worth Ratio of SBI in the
year 2012-13 was 14.26% and that of ICICI bank in 2014-15 was 13.89% .Whereas, the lowest
Return on Net Worth Ratio of SBI in the year 2016-17 was 5.57% and of ICICI bank, it was
9.35% inn 2010-11.

The average Net Worth Ratio of SBI is 10.20% and that of ICICI bank is 8.046% which implies
that the average Net Worth Ratio of SBI i.e. 2.154% more than the ICICI bank.

EARNING PER SHARE (EPS) Table 4

 SBI

(RS. In Crores) ICICI (RS. In Crores)
Year No. Of
Net No. Of Equity Earnings Net Earnings
Equity
Profit Shares Per Share Profit Per Share
Shares
2010-11 7370 63.50 116.06 5149 115.17 44.70
2011-12 11707 67.10 174.47 6465 115.27 56.08
2012-13 14105 68.40 206.21 8325 115.36 72.16
2013-14 10891 74.65 145.90 9810 115.50 84.93
2014-15 13101 74.65 175.49 11175 115.96 96.37
2015-16 9950 77.62 128.18 9726 116.31 83.62
2016-17 10484 79.73 131.49 9801 116.51 84.12
AVERAGE 153.97 AVERAGE 74.56

Table No.4 reveals that the highest Earnings per Share was 206.21 in the year 2012-13 and that
of ICICI bank was 96.37 in 2014-15. Whereas, the lowest Earnings per share of SBI in the year
2010-11 was 63.50 and that of ICICI bank in the year 2010-11 was 44.70.

The average Earnings per Share of SBI is 153.97 and ICICI bank is 74.56, which implies that the
Average Earnings per share of SBI is 79.41, which is more than that of ICICI bank.

TOTAL ASSETS TURNOVER RATIO:


Table 5

SBI

ICICI (RS. In Crores)
(RS. In Crores)
Total Total
Year
Total Assets Total Assets
Net Sales Net Sales
Assets Turnover Assets Turnover
Ratio Ratio
2010-11 96329 1223736 0.07 33082 406234 0.08
2011-12 120872 1335519 0.09 41045 473647 0.08
2012-13 135691 1566211 0.08 48421 536794 0.09
2013-14 154903 1792748 0.08 54606 594641 0.09
2014-15 174972 2048079 0.08 61267 646129 0.09
2015-16 191843 2357617 0.08 68062 720695 0.09
2016-17 210979 2705966 0.07 73661 771791 0.09
0.078 0.087
AVERAGE AVERAGE

Table No. 5 depicts that the Total Assets Turnover Ratio of both SBI and ICICI banks was stable.
The highest Assets Turnover Ratio of SBI is 0.09 times in 2011-12 and that of ICICI bank was
stable during the study period. The average Total Assets Turnover Ratio of SBI is 0.078 times
and of ICICI bank is 0.087 times, which implies that the average Total Assets of SBI Bank is
more than that of the ICICI bank.

INTEREST EXPENDED TO INTEREST EARNED RATIO:

Table 6

SBI

(RS. In Crores) ICICI (RS. In Crores)
Year
Interest Interest Interest Interest
Ratio Ratio
Expended Earned Expended Earned
2010-11 48868 81394 60.03 16957 25974 65.28
2011-12 63230 106521 59.36 22808 33542 68.00
2012-13 75325 119657 62.95 26209 40075 65.39
2013-14 87068 136350 63.85 27702 44178 62.70
2014-15 97382 152397 63.90 30051 49091 61.21
2015-16 106803 163685 65.24 31515 52739 59.75
2016-17 113658 175518 64.75 32419 54516 59.47
AVERAGE 62.86 AVERAGE 63.11

Table no. 6 explain that during the study period, Interest expended to Interest Earned Ratio of
both SBI bank and ICICI bank fluctuated. The highest Interest Expended to Interest Earned Ratio
of SBI was 65.24% in the year 2015-16 and for ICICI bank; it was 68.00% in 2011-12. Whereas
the lowest Interest Expended to Interest Earned Ratio of SBI was 59.36% in 2011-12 and for
ICICI bank was 59.47 in 2016-17.
The average Interest Expended to Interest Earned Ratio of SBI is 62.86% and that of ICICI bank
is 63.11%, which implies that the average interest Expended to Interest Earned Ratio of ICICI
bank is more than that of the SBI bank with 0.25%.

FINDINGS, SUGGESTIONS AND CONCLUSION:

• The average Net Profit Ratio of SBI is 7.48% and ICICI bank is 16.04% which implies that
the Net Profit Ratio of ICICI bank is 8.56, which is more than that of the SBI.

• The average Operating Profit Ratio of SBI is 22.26% and that of ICICI bank is 29.61%
which implies that the Operating Profit Ratio of ICICI 7.35% which is more than that of
SBI bank. 


• The average Net Worth Ratio of SBI is 10.20% and that of ICICI bank is 8.046% which 

implies that the average Net Worth Ratio of SBI i.e. 2.154% more than the ICICI bank. 


• The average Earnings per Share of SBI is 153.97 and ICICI bank is 74.56 , which
implies that 

the Average Earnings per share of SBI is 79.41, which is more than that of ICICI bank. 


• The average Total Assets Turnover Ratio of SBI is 0.078 times and of ICICI bank is
0.087 times, which implies that the average Total Assets of SBI Bank is more than that of
the 

ICICI bank 


• The average Interest Expended to Interest Earned Ratio of SBI is 62.86% and that of
ICICI 

bank is 63.11%, which implies that the average interest Expended to Interest Earned
Ratio of ICICI bank is more than that of the SBI bank with 0.25%.



SUGGESTIONS: 


• As Earnings per share (EPS) of ICICI bank is low as comparative to SBI.

Therefore, the ICICI bank needs to take some measures to increase its
income over its expenditure. 

• Interest expended to interest earned ratio of SBI is less as comparative to
ICICI. So, SBI bank need to take some effectives steps in order to increase its
more earning capacity. 


• Average net worth ratio of ICICI bank is less. Therefore, ICICI should
increase its net worth more as comparative to other banks. 


CONCLUSION:


It is concluded that both the selected banks i.e. SBI and ICICI are maintaining the equitable
standards and earning the profits. The position of the both the banks is satisfactory but by
comparing the performance of the SBI and ICICI banks, it indicates that there are significant
difference between SBI and ICICI in terms of Net profit, Operating profit and Net Worth. But it
is observed that the overall performance of SBI bank is better than ICICI bank.