Submitted To: Prof. S.V.

Bidwai
Date: 7th September, 2010
College: IBS Mumbai
Submitted By:
Ketaki Gondane 09BS0001061
Rachit Sharma 09BS0001742
Dr. Mehul Kumar 09BS0000974
Nishant Vora 09BS0001462
Prakash Krishnamoorthy 09BS0001615
Preha Sharma 09BS0001667
Pankaj Malhotra 09BS0001532
Hrishikesh Rao 09BS0000894
 Competitive
INTRODU strategy of late
CTION entrant

Technology Differentiation
competitive through knowledge
advantage banking

Banking system
Appreciation of
in an emerging
human resource market

CONCLUSI
ON
Objective

COMPETITIVE
STRATEGY
OF A
LATE ENTRANT
ABOUT YES BANK :
YES BANK, India’s new age private sector Bank,
is an outcome of the professional
entrepreneurship of its Founder, Rana Kapoor
and his highly competent top management team,
to establish a high quality, customer centric,
service driven, private Indian Bank catering to the
“Future Businesses of India”.

YES BANK has fructified into a “full service”

commercial Bank
Yes Bank was ranked as the third best bank in
India by Businessworld and second among new
age private sector banks in the country by
Financial Express
Vision: To create a commercially viable
financial institution that incorporates
sustainable development within core
business functions
The Bank has adopted international best practices
KNOWLEDGE DRIVEN APPROACH
 YES BANK is committed to support the
sustainable growth and development of
sunrise sectors in the country, by facilitating
overall growth through strategic knowledge
initiatives.
BANK has formed a specialized ‘Development
and Knowledge Banking Division’
YES BANK has invested in the best IT systems
and practices in order to make its technology
platform a strategic business tool for building a
competitive advantage
YES BANK has been recognized amongst the
Top and the Fastest Growing Bank in
various Indian Banking League Tables
BACKGROUND NOTE
Economic reforms in early 1990’s –
Narasimham Committee

Many important reforms were undertaken in the

banking sector.

Important private sector banks were set up in

the wake of the banking reforms
Results of the reform in the banking sector was very
impressive. The new generation private banks had
revolutionized the sector.
Several technological advancements had taken place.
After the successful completion of the first phase of
Narsimham committee , a second narasimhan
committee was recommended in the banking sector.
Other banks were also introduced in the banking
sector.
STAKEHOLDERS
Chart Title
Promoters Rabobank
HSBC Financial Services Khazanah Nasional
American Funds Insurance Series Growth Fund SmallCap World Fund 3.64%
R. F . Chandler ( formerly Orient Global) Deutsche securities
CommonWealth Equity Fund Stichting Pensioenfunds ABP
FOREIGN INVESTOR FDI

10% 33%

30%

5%
1% 4%
1%
2% 3% 4%
3% 4%
Yes bank
• Yes bank, one of the new generation private
bank , entered Indian market in late 2004 when
the banking sector in india was already
overcrowded by no of public bank
• But inspite of late enterent the bank grew up
with such a fast pace that it drew the attention of
analysist and extend its operations to all over the
country
Yes bank
• In dec 2006 the bank rated as third best private
bank in India by business world and won many
other awards
• Ranked second best private bank in financial
express –Ernst & young survey of India’s best for
the year 2006
Yes bank
• The yes bank was promoted by Rana kapoor and
Ashok Kapur with assistance from robobank
• Kapoor and kapur together own 52.5 % of the
initial promoters equity of 20 m
• While the Indian promoters had 39 % stake in
the bank , robobank had 20 % stake and FII held
20 %
• The bank went public in june 2005. IPO was
over subscribed 30 times
Yes bank segmentation
Yes bank
o Niche market

• Corporate & institutional banking

EXPOSURES IN DIFFERENT SECTORS

Chart Title
INFRASTRUCTURE AND LOGISTICS FOOD AND AGRICULTURE
OTHERS TMT
ENGINEERING HEALTHCARE

8% 21%
19%

17%
13% 22%
Business strategy
THE GROWTH STORY
• In the first two quarters since it began
operations in 2004-05 its balance sheet was
standing at Rs.1300million.

• This was one of the most successful ventures in

India.

• It started its operations with 250 employees and

2 branches.
• YES BANK, India's new age private sector Bank,
has embarked on its journey into the next phase
of growth, and launched the Bank's VERSION 2.0
- the Take-off.

• Mr. Rana Kapoor, Founder/Managing Director &

CEO, along with his top management team
announced the roll-out of a strategic blueprint for
the Bank, to further accelerate its business growth
with the objective to achieve a balance sheet size
of INR 150,000 crores, a pan India branch
network of 750 with a human capital base 12,000
by 2015.
• The bank’s business size was Rs 800 million in
December 2006.

• This was significantly higher than the growth

reported by other private sector banks with the
same background.

• Now the bank is performing above this level.

Key Balance Sheet Items 2010 2006
Advances 480
Investments 221.9
Shareholder’s Fund 75.6
Deposits 546.1
Borrowings 119.4
Business foot print 816.1
• Initially almost the entire emphasis of the bank
was on lending to corporate clients.

• The next focus area being wealth management.

• The bank focus mainly on business banking and

SME’s for its growth.

• It forayed into retail banking and by April 2007

it had a base of 25000 customers.
• In december 2006, it was rated the 3rd best bank
in India.

• The second best bank among new private sector

banks.

Rank TOP 5
1 HDFC bank
2 ICICI bank
3 YES bank
4 Indian Overseas Bank
5 Kotak Mahindra Bank
• Yes Bank has been ranked 7 amongst the top 10
Indian Banks,

• while being ranked 1 on the parameter of

GROWTH,

• No. 2 on FINANCIAL STRENGTH

• No. 5 on EFFICIENCY by The Economic Times

AWARDS AND RECOGNITION
• YES bank achieved many awards and recognition in this
relatively short time frame.

• The market cap of the bank had grown from Rs. 164.2 million
in July,2005 to Rs. 424.3million in February,2007.

• This was indeed great achievement for a bank that had entered
the Indian banking scenario so late.

• The bank was awarded the Financial Insights innovation

Award for innovation in Business intelligence at the Asian
Financial Services Congress
Corporate Dossier, Economic Times Rana Kapoor, Founder / MD & CEO
(December 2005) was ranked amongst the 100 most
powerful CEOs in India
Business Today most valuable YES BANK was ranked the 105th most
companies (November 2005) valuable private sector company and the
7th most valuable bank in India
Ernst & Young Entrepreneur Awards Rana Kapoor, Founder / MD & CEO was
'05 (November 2005) adjudged the Start-up Entrepreneur of the
Year
Environment Leadership Award YES BANK was awarded for contributions
from USAID (October 2005) made through working in partnerships to
improve the environment/quality of life for
the people of Asia
Asiamoney Foreign Exchange Poll YES BANK was ranked second in the ‘Best
for India (September 2005) for Currency Strategy’ and ‘Best for
Technical Analysis’ categories under the
Best Domestic FX providers - Corporate
Business Today technology wired YES BANK was ranked amongst the 20
companies (February 2005) most technology wired companies
ICRA (Moody's affiliate in India) A1+ rating for YES BANK’s certificate of
(October 2004) deposit programme in the second month of
operations (current programme size - INR
12 billion)
New Economy First YES BANK was awarded the “Most Innovative
Annual Banking and Bank in India” at the New Economy First Annual
Finance Awards 2008 Banking and Finance Awards 2008 held in London
(Dec – Jan 2008) and were announced in the December 2008 issue
of the International Magazine, New Economy. YES
BANK is the only Indian Bank to have won this
award.
Business Today - KPMG YES BANK ranked No. 1 in the Business Today – KPMG
BEST BANKS Annual BEST BANKS Annual Survey 2008. Ranked No.1 in 11
Survey 2008 ( December parameters amongst it peers with Balance Sheet Size less
2008) than INR 24,000 crore

Financial Times/IFC, YES BANK won the prestigious Emerging Markets

Washington - Sustainable Sustainable Bank of the Year Award at the Financial
Banking Awards 2006 Times/IFC, Washington Sustainable Banking Awards held
(June 2008) in London. YES BANK was the only Indian Bank to have
received this accolade out of 182 entries from 129
institutions across 54 countries.

Thomson Reuters YES BANK ranked No.3 in the All Asian Securitized Bonds
(September 30, 2008) League (Ex Japan Ex-Australia) conducted by Thomson
Reuters.
YES BANK ranked No. 5 in India Rupee Bond League for
the period January 1, 2008 to September 30, 2008
conducted by Thomson Reuters.
Key Financial Highlights
• Net Profit after Tax of Rs. 3038.4 million in FY09 compared to Rs.
2000.2 million in FY08 representing an increase of 51.9%

• Net Profit after Tax of Rs. 801.1 million in Q4FY09 compared to Rs.
645.1 million in Q4FY08 representing an increase of 24.2%

• Net interest income (NII) of Rs. 5111.8 million in FY09 compared to

Rs. 3305.7 million in FY08 representing an increase of 54.6%; NII of
Rs. 1552.2 million in Q4FY09 compared to Rs. 1067.4 million in
Q4FY08 representing an increase of 45.4%

• Total Net income (NII plus Non Interest Income) of Rs. 9801.6
million in FY09 compared to Rs. 6912.4 million in FY08 representing
an increase of 41.8%; Total Net income of Rs. 2449.8 million in
Q4FY09 compared to Rs. 2143.2 million in Q4FY08 representing an
increase of 14.3%
• Operating Profit of Rs. 5616.1 million in FY09 compared to Rs. 3500.8
million in FY08 representing an increase of 60.4%;

• Operating Profit of Rs. 1539.4 million in Q4FY09 compared to Rs.

1209.4 million in Q4FY08 representing an increase of 27.3%

• Non-interest income to total income ratio of 47.8% in FY09; 36.6% in

Q4FY09

• Cost to Income ratio of 42.7% in FY09; 37.2% in Q4FY09

• Advances at Rs. 124.0 billion as at Mar 31, 2009; growth of 31.5% y-o-y

• Gross yield on advances of 12.8% in FY09; 13.0% in Q4FY09

• Deposits at Rs. 161.7 billion as at Mar 31, 2009; growth of 21.8% y-o-y

• Cost of funds of 9.0% in FY09; 8.8% in Q4FY09

• Net Interest Margin of 2.9% in FY09; 3.0% in Q4FY09

• Gross NPA at 0.68% to Gross Advances as at Mar 31,
2009
• Net NPA at 0.33% to Net Advances as at Mar 31, 2009
• Loan loss provisions of Rs. 265.4 million in FY09; total
loan loss provisions of Rs. 791.2 million as at Mar 31, 2009
• Total loan loss coverage ratio of 144.7%; Specific loan loss
coverage ratio of 51.5% as at Mar 31, 2009
• Total Capital Funds (Tier I + Tier II) of Rs. 30.67 billion as
at Mar 31, 2009
• Basel II Capital Adequacy Ratio of 16.63% at Mar 31, 2009
(Tier I at 9.50%)
• Return on Average Assets of 1.52% in FY09; 1.50%
(annualized) in Q4FY09
• Return on Equity of 20.7% in FY09; 20.2% (annualized) in
Q4FY09
• Book value per share of Rs. 54.69 as at Mar 31, 2009
• Basic EPS of Rs. 10.24 and Diluted EPS of Rs. 10.14 for
FY09; Rs. 2.70 and Rs. 2.67 for Q4FY09
• FY09 FY08 Growth% Q4FY09 Q4FY08 Growth
%
Key Business Highlights
• Well capitalized for upturn: Basel II Tier I capital of 9.50% and
CRAR of 16.63% as at Mar 31, 2009 provide significant headroom
for growth. During the fiscal year, Bank mobilized capital funds of
Rs. 10.6 billion (the highest since inception in the most challenging
environment) including Rs. 1.54 billion of Tier I Perpetual Capital
Bonds during Q4FY09 (issue oversubscribe by 105%), the first by
any Indian private sector Bank during FY09. Total capital funds
stand at Rs. 30.67 billion as at Mar 31, 2009 (Rs. 20.72 billion as at
Mar 31, 2008).
• Strong Asset Quality: High quality corporate exposure (80% of the
externally rated exposure rated ‘A’ and above) resulted in 13%
reduction of total RWA for the bank improving the CRAR to 16.63%
under Basel II as against 14.53% under Basel I as at Mar 31, 2009;
manageable Gross and Net NPA ratios coupled with prudent
provisioning policy (total provisioning cover of 144.7% as at Mar 31,
2009).
• Sustainable NIM in a challenging macro-
environment driven by pricing power on
Corporate loan book and re-pricing of a
relatively higher proportion of interest sensitive
liabilities; NIM of 2.9% in FY09 (2.7% in FY08).
• Superior Shareholders’ returns: Amongst the
highest RoE (20.7%) and RoA (1.52%) in the
Banking industry during FY09 signifying
sustained and profitable revenue growth during
a difficult year for the economy.
• Private sector lender Yes Bank Ltd posted a 75% increase
in net profit to Rs140 crore in the quarter ended 31
March, buoyed by loan growth and an increase in other
income.
• The yield on advances fell to 9.7% from 13% and the cost
of funds to 6.3% from 8.8%. The net interest margin
widened to 3.2% from 3%.
• Other income, or that generated by activities other than
its main business, grew 68.3% to Rs160.10 crore from
Rs95.10 crore as transaction banking and the financial
advisory businesses grew.
• Transaction banking generated income of Rs43.20 crore,
while that from financial advisory work was Rs57.80
crore.
• The financial markets business posted revenue of
Rs47.40 crore, and third-party distribution and retail fees
stood at Rs11.70 crore for the quarter. Operating profit
rose 67.3% to Rs257.60 crore, from Rs153.90 crore.
YES Bank taps SMEs for inclusive growth

• To give a fillip to the small & medium enterprises (SME), YES Bank is
allocating about Rs 4,000 crore to this space in the current year. Till the
end of March, 2010, the private sector lender had lent around Rs 1,500
crore to smaller firms.
• Till October last year, YES Bank has been disbursing SME loans only from
13 branches. But it has started such operations from 33 locations. By the
end of the current year, at least 50 locations would be equipped to disburse
SME loans, helping the bank access more customers.
• On the hiring front, the bank’s employee strength for the SME business has
risen to 300 people as at the end of March 2010, from 82 people in October
2009. The bank is expected to recruit an additional 100 people in 2010-11.
• The bank unveiled its five-year growth plan christened VERSION 2.0–the
Take-off.
• The bank aims to achieve a balance sheet size of Rs 1,50,000 crore, a pan-
India branch network of 750 with a human capital base 12,000 by 2015.
FUTURE GROWTH STRATEGY
• YES bank is also looking at increasing its
workforce from 3,030 to 4,500 by the end of this
fiscal that began on 1 April, he said. Its deposit
base rose 65.7% to Rs26,798.60 crore, from
Rs16,169.40 crore at the end of March 2009.
Current and savings accounts stood at 10.5% of
• At the end of March, the bank’s capital adequacy
ratio was 20.61%, while net non-performing loans
stood at 0.06% against 0.68% at the end of the
previous year. deposits at the end of March 2011.
 Yes Bank targets loan growth of 40-45 pct in FY11

• To tap available hybrid capital headroom of 15 bln rupees

• Aims to maintain net interest margin of over 3 pct in FY11
• To spend 600-750 mln rupees for branch expansion
• Private sector lender Yes Bank is targeting loan growth of
40-45 percent and hopes to maintain net interest margin
above 3 percent in 2010/11, a top official said on Tuesday.
The bank has headroom to raise hybrid capital of 15 billion
rupees in FY11, which can be tapped as and when required.
• The mid-sized lender has a capital adequacy ratio of 20.6
percent and a loan book of 221.93 billion rupees as on March
31.
• It will spend 600-750 million rupees to expand branch
network to 250 by June 2011, from 150 now, to establish its
retail footprint.
• The bank also plans to raise its headcount to 4,500 in
2010/11, from 3,030 now, as it starts launching
consumer loan products following a network
expansion.
• Earlier in the day, it posted a 75 percent rise in Jan-
March net profit to 1.4 billion rupees on higher lending,
mainly to corporate.
• The profit, however, lagged street estimates of 1.45
billion rupees for the quarter.
• Yes Bank's loans in the March quarter rose 78.9
percent, while interest margin was at 3.2 percent on
higher disbursements to corporate and trade finance.
• Shares in the bank ended down 2.1 percent at 275.50
rupees in the Mumbai market that was down 0.31
percent.
FINANCIAL ANALYSIS
 Mkt
Net Interest
BANK Last Price Capitalizatio Net Profit Total Assets Estb.
Income
n

Karur Vysya 587.00 3,195.37 1,757.94 336.03 21,993.49 1916

ING Vysya
349.50 4,195.64 2,232.90 242.22 33,880.24 1930
Bank

JK Bank 824.35 3,996.27 3,056.88 512.38 37,693.26 1938

Federal Bank 359.60 6,147.16 3,673.23 464.55 38,850.88 1945

Kotak
786.00 27,399.52 3,255.62 561.11 37,436.31 1985
Mahindra
IndusInd
207.40 8,512.83 2,706.99 350.31 35,369.52 1994
Bank
Yes Bank 298.25 10,170.93 2,369.71 477.74 36,382.50 2003
 YES BANK Quarter STATS
▫ Net Profit – 75% of yoy for 4QFY 2010.
▫ Loans increased by 18.6%
▫ Deposits increased by 21.6%
▫ Rs 1034cr raised in Jan,2010 to reduce cost of funds
▫ Gross NPA ratio was at 0.3%, Net NPA ratio was at 0.1%
▫ CAR (Capital Adequacy Ratio) improved to 20.6%
 CAR = Tier 1 capital + Tier 2 capital
Risk Weighted Assets
TIER 1 CAPITAL -A)Equity Capital, B) Disclosed Reserves = 12.9% = 338
TIER 2 CAPITAL -A)Undisclosed Reserves, B)General Loss reserves, C)Subordinate Term Debts =
1815
Risk weighted assets = (338+1815)/0.206 = 10451
YES BANK Yearly STATS
• NII – Increased from 511 to 779cr
NII = (interest payments on assets) − (interest payments on
liabilities)
• Net Profit – Increased from 304 to 492cr
• EPS – From Rs10.2 to Rs14.6
• P/E – 28.6 to 20.1
• Opened 18 branches in last quarter and moved to 150
branches and plans to open 70 more by 2011
 STRATEGIES-
FocusDIFFERENTIATION
on niche sectors

Knowledge Banking Approach

Outsourcing Information Technology to focus on core competency

Strategic Partnerships

Human resources as a competitive advantage

Non conventional promotional strategy

 Focus on
niche
sector

Corporate services
like mergers and
acquisitions , financial
restructuring,
currency risk
management.

Providing wealth Providing

management specialized
solutions to services to sunrise
affluent customers industries
Knowledge banking approach
A unique method of acquiring customers and retaining them
by –
Speaking the “language of clients”
Providing banking solutions through industry specialists

Some sectors identified by YES BANK to offer

specialized services are-
I. Food and agriculture
II. Infrastructure development
III. Life sciences and Biotechnology
IV. Telecommunications
V. Information Technology
VI. Media and Entertainment
VII.Real estates
Parameters used by YES BANK in
choosing the Focus sectors-

Potential to add value in providing banking products

Recognition and appreciation of knowledge as a

differentiator

Growth potential of the sector

Opportunities for banking products and competitor activity

India’s competitive position internationally in the sector

Sector Opportuinity Clientele Services

Food and Emergence of Govt of India, Publishing

agriculture organized retail Industry clientele knowledge reports,
Project
implementation

Infrastructure Build-Operate- Govt of India Joint venture

development Transfer schemes, agreements, Risk
Public private management,
partnerships Project control

Life science and Networking, tie ups Govt of india Strategic and
Biotechnology financial advisor
Telecommunicat Govt policy, Telecom industry Specialized services
ions Consolidation
IT Foreign currency Globe trottiing Non traditional
professionals form of banking
services
Media and Content Media houses Fund raising, direct
Entertainment production, content financing
distribution
Strategic Initiatives & Advisory Government
(SIG) Group
It is the government advisory & development research arm
within YES BANK.
Outsourcing deal with Wipro InfoTech

On Dec 2004

Seven year contract
Total installation, operation
and maintenance
of IT assets of YES BANK
would be handled by Wipro
Infotech
CRITICAL AREAS IDENTIFIED ON THE
TECH FRONT BY YES BANK
1) High level of efficiency through automation of
operations
2)Centralized databases and processing for speedy
recovery of data
3)Connectivity with customers and external agencies
at various “touch points”.
4)Best systems for integration of front , middle and
back offices.
5)Adopting best surveillance and security systems
6)Using real time environment for good disaster
recovery process and back up systems
 STRATEGIC
PARTNERSHIPS
Partnership with Importance
Gartner Inc To formulate and implement the bank’s
IT policy

PriceWaterhouseCoopers To facilitate the confirmation of policies

and processes with ISO and Six Sigma

i-flex solutions ltd FLEXCUBE- universal banking solution

software

Cash Tech Cash management solution provider

Murex Risk management

 TECHNOLOGY ADVANTAGE
YES BANK now delivers a complete banking platform
comprising-
Core banking
Integrated Treasury & Risk management solutions
Internet banking for Retail and Corporate
ATMs & Switch

Awards on the Technology front-

a)NASSCOM award for ‘IT Innovation in Emerging
India in 2006
b)‘Technology Innovation’ award from AC Nielsen
Human resources
Human resources initiatives
• HR as a strategic asset
• HR policy objectives-
i. Best employer in the sector
ii. Most preferred employer
iii. Retaining talented employees
• Took several Initiatives in HR strategy
• Followed pfm process-aligning individual goal
with that of organization
 • Aim-to encourage employess to think innovatively and
inculcate professional entreneurship
• 5 % executive ownership clause-first such in the sector
• Key initiatives-
a) Yes entrepreneur in Action-program helped the
employees of the bank to take a break from regular
work and to focus on a project of his /her interest.
b) Yes-professional entrepreneurship prg(YPEP):
-Talent management initiative of the bank.
-focused on developing the talent of the employees
- objective was to ensure that the bank had best
managers in the middle and upper levels of the
management to implement its strategic initiatives.
c) Yes-Retail entrepreneurship program(YREP):
-yet another talent management initiative
-prg aimed at inculcating the cutting edge skills in
the employees in the latest developments of the
sector to meet the bank’s future requirements.
- had the futuristic vision and also expected to give
big competitive edge over its competitors.
d) Yes Mentor-another imp. Initiative
- involved assigning a senior and dynamis employee
as a mentor to a new employee.
- helped the new employee to understand the
organisation environment and goals of the
organisation and thus better inegration into the
organisation.
e) Yes School of Banking- Modelled on the lines of
some of the centers of learning promoted by the
corporate sector.
-incorporated to create a center of excellence for
providing training in banking and other financial
services in the country.
-the institute was modelled on the values of yes bank to
recruit and nurture the best talent in the banking sector.
f) Yes University and school relations-since the bank
recruited meritorious student directly from the
university campuses, this program focused on
maintaining good relations with the univ./schools.
-this partnership went to the extent of preparing
specialized courses for th student meeting its its specific
requirements.
-This also focused on reverse contribution to the
academia by by giving internship training to the
selected students.

• Bank’s Hr strategies won major awards-

‘Continuous Innovation in HR Strategy’ award at
the Indiatimes Mindscape Employer Branding
Awards(2007)
• ‘Staffing program’ award at the RASBIC
Awards(2006)and
• The ‘organization with most innovative HR
Practices’ award at the Global HR Excellence
Awards, as part of the Asia Pacific HRM
Congress 2007 held in Mumbai.
• YES BANK wins 5 awards at Asia's Best
Employer Brand Awards and the CMO Asia
Awards for Excellence in Branding and
Marketing- held at Sinagapore on Aug. 3,
2010.
• YES BANK was the only Indian private sector bank
to receive these awards in the following categories:
• Best HR Strategy in Line with Business
• Excellence in HR Through Technology
• Continuous Innovation in HR Strategy at Work
• Innovation in Recruitment
• Award for Brand Excellence (Banking and
Financial Services)
Promotion
Promotion
• Yes Bank also differentiated itself in the way it
promoted itself.
• Reliance was not much on advertising but on
management led client acquisition for corporate
and wealth management clients.
• Also strove to provide a delightful banking
experience through the layout of branches and
other services(lot of wall effects and flooring).
• Probably the first bank to have a chief marketing
officer. A roving ambassador ensures that anyone
walking in should get immediate personal
attention.
• Also there are investment officers,insurane
officers,etc.
• Then there is also the private banking lounge
• Introductory TV ads-bank showed the growth
stages of money plant Scindapsus Aureus—
Roman word-Aureus -(gold coin)
• The plant,believed to bring wealth and
happiness,was used by the bank as a metaphor
for ideas getting realized.
• A perennial climber,this Yes Bank Money plant
symbolised the bank’s commitment to growth.
• As part of the campaigns,the bank gifted
• 8000 money plant to its business clients,instead
of sending diaries,calenders or sweets.
• Also planned to launch radio, outdoor and
online ad campaigns.
• Also plans to focus on educating the customers
on risk issues by organizing open house forums.
Employee Value Proposition
SELECT RESPONSIBLE BANKING INITIATIVES
 Malnutrition Matters (MM)
YES BANK as Technology Transfer Agent

 MM’s VitaGoat employs bicycle-powered grinders and

variety of locally available fuels to prepare protein-rich soy
products like soy yogurt, tofu, and milk as a lower cost,
nutritious alternative to milk
Results:
 VitaGoat deployed at Buldana Urban Co-operative Credit
Society run residential school since 2007
 700 school children fed daily with soy milk/paneer 
 Expansion to Rajasthan with the delivery of first VitaGoat to
Seva Mandir in Jan 2010 Seva Mandir employee using
VitaGoat to grind Soybeans
 Expected to serve ~300-400 people per day
Microfinance Institutions Group (MIG)
Multiplier Effect: The Indirect Impact
 Institutes specific transactions to position microfinance as a new asset
class, appealing to a broad base of investors and lenders, expanding
access to capital
 FIRST Indian bank to undertake innovations in capital market products
for microfinance:
o Capital Market Products
 Banks have been main source of debt funding for MFIs (term
loans)
 Term loans are relatively expensive they are illiquid
 YES BANK arranged first rated bond issuance of an MFI in the
world in the form of Commercial Paper & Non-Convertible
Debentures of INR 2000 mn (USD 40 mn)

Potential incremental access to capital for industry of USD 12-14bn annually,

impacting 60-70mn clients
 Zameen Organic
Overcoming the ‘last mile’
 Fair trade supported company owned by Small Farmers’ Organizations

 Network of 6,000 small farmers producing organic cotton in the

Vidharbha (Maharashtra) and Adilabad (Andhra Pradesh) regions

 Provides vital processing and marketing linkage between organic

farmers and branding companies

 Unique concept of Premium: Farmer Premium and Community

Premium

YES BANK is Zameen’s Sole Banking Partner

 Sustainable Investment Bank
Advisory to SME, Social & Environment Sectors

 Promotes investments, provides advisory

services & facilitates growth capital for social &
environment focused enterprises
 Asmitha Microfinance Ltd – raised USD
10mn for one of top five Indian MFI
serving ~1.16 mn clients, through private
placement of equity
 Gradatim IT Ventures - raised USD 3mn
growth capital enabling MFI access to
technological interventions that increase
operational efficiencies and reduce costs
The Growth story

•Grown at a tremendous pace.

•First two quarters, balance sheet stranded Rs 1300
million.
•One of the most successful ventures.
•Started operations with 250 employees and two
branches.
Initial Growth
• December,2006 Business size was Rs. 800
million .
• October,2007 operating with 60 branches and
3,263 employees.
• Base of 25,000 customers.
• Growth rate significantly higher than other
private sector banks.
• Market cap became Rs424.3 million.
Initial Growth Strategy
• Entire focus was on lending to corporate clients.
• Next focus area being wealth management
• Main focus on Business banking and small and
medium enterprises.
• Forayed into rental banking by April,2007.
Instruments of Growth
• A focused business strategy.
• Entrepreneurial leadership.
• Highly rated employees
• Best in class processes.
• Evolutionary Technology.
Top five new Private sector banks in 2006
(Ernst and Young Survey)
NAME FINAL STRENGHT GROW PROFI EFFICIE CREDI
RANK H&SOUND TH TABIL NCY T
NESS ITY QUALI
TY
ICICI 1 1 3 5 1 2
Bank
YES 2 4 1 3 3 1
Bank
HDFC 3 3 6 1 4 5
Bank
AXIS 4 5 5 2 2 6
bank
Kotak 5 6 4 4 5 3
Mahindra
Bank
Rank on various parameters
• Business world ,December 4,2006:-
▫ Profitability-6
▫ Size-32
▫ Efficiency-1
▫ Valuation-3
▫ Safety-1
▫ Growth-1
Top Ten Banks In India(Business World ,
December 4,2006)
1. HDFC Bank
2. ICICI Bank
3. Yes Bank
4. Indian Overseas Bank
5. Kotak Mahindra Bank
6. Punjab National Bank
7. Andhra Bank
8. Corporation Bank
9. Allahabad Bank
10. Axis Bank
Milestones of YES bank
May 2004 RBI license to commence banking business

Dec 2006 Ranked no. 3 in businessworld survey of India's best bank.

Mar 2007 Ranked no. 2 among new private sector banks in financial
express survey.

Dec 2007 Won ‘Best CSR practice award 2007’ .

Dec 2007 Won IT People award 2007’.

Jan 2008 60 operational branches across India.

Mar 2008 Ranked no. 3 new private sector bank in financial express-
Earnest and Young survey
SWOT ANALYSIS
• STRENGTH
▫ High quality, customer centric, service driven
private bank catering “future industries of India”
▫ Adopted international best practices.
▫ Strong technology, well capitalized.
▫ Capital adequacy ratio 16.6%.
• WEAKNESS
▫ Less wide network.
▫ Not in every state.
▫ Less promotional activity.
▫ Unknown brand.
• OPPORTUNITY
▫ Very wide market.
▫ Other activity(insurance, stock broking, mutual
fund).
▫ Wide scope in rural area.
• THREAT
▫ Very high competition private bank as well as
public sector.
▫ Government policy.
▫ Other better saving options available
(like insurance, mutual fund, real estate, gold)
▫ Capital market slowdown.
▫ Rising rates.
Recent Development
The Growth History
Grown at Tremendous pace since its inception

One of the most successful ventures in India: Balance

sheet satnding at 1300million in the first two quarters

Started its operation with 250 employees & 2

branches
 The Growth Story
Key Balance Sheet Items 2006(Rs mn) 2005(Rs mn) Growth(%)
Advances 480 191.1 151
Investments 221.9 116.1 91
Shareholder's funds 75.6 55.2 37
Deposits 546.1 177.8 207
Borrowings 119.4 36.3 229
Business footprint 816.1 379.8 115

900

800

700

600

500 2006(Rs mn)

2005(Rs mn)
400
Growth(%)
300

200

100

0
Advances Investments Shareholder's Deposits Borrowings Business footprint
funds
 Recent Trend in Growth

Key Balance Sheet Items 2010(in Rs Cr) 2009(in Rs Cr) Growth(%)

Advances 22193.12 12403.09 78.9

Investments 10209.94 7117.02 43.45

Total share capital 339.67 296.98 14.37

Deposits 26798.57 16169.42 65.73

Borrowings 4749.08 2189.1 116.9

Total assets 36382.5 22900.8 58.86

• YES BANK has 117 operational branches across 92
cities nationally, 93 offsite ATM’s in Mumbai, NCR
and Pune along with 2 National Processing Centers
at Mumbai and Gurgaon as at Mar 31, 2009.
• Foreign shareholding at 53% includes pedigree
investors like Orient Global, Rabobank, HSBC,
Franklin Tempelton among others.
• Senior Management personnel effectively hold 7%
while Rabobank as a Financial Investor holds
18.2%.
Say Yes to Agribusiness
• YES Bank, as a bank for future industries of
India, through it’s knowledge driven approach, is
committed to focus on the Food and
Agribusiness sector.
• It has taken several initiatives: from ‘Farm
Gate’ to ‘Food Plate’.
• The various initiatives that the Yes Bank has
undertaken to transform business and finance of
Agribusiness are:
• End to End Advisory on developing India’s First
Agri SEZ
• Strategic and Financial Advisors to development of
India’s First of it’s kind Agro Parks
• National Consultants to Union Ministry of
Agriculture on development of Modern
Terminal Markets.
• Advisory to Corporate on Large scale Farming
Initiatives towards enhancing Food Security.
• YES Bank's mobile money services
Conclusion
Major Instruments for Growth
Focussed business strategy

Entrepreneurial leadership

Highly rated employees

Best-in-class processes

Evolutionary technology
Reasons for Successful Market Entry

Bank’s competence in terms of using high-end

technology

Knowledge banking approach

Emphasis on highly qualified human resources

Catered to niche segment of the market with a

differentiated strategy

Yes Bank started its operations buring Retail boom

Achievements
 In December 2006, the third best bank in India in Business
world’s annual survey

 The second best among the new private sector banks in the
Financial Express-Ernst & Young Survey of India

 Top ten banks in India on the basis of following parameters

Profitability
Efficiency
Safety
Size
Valuation
Growth
• Yes Bank adopted the Differentiation strategy to gain
Competitive Advantage. It followed the following
approaches:
• Knowledge Banking
 Food & Agribusiness
 Infrastructure Development
 Healthcare & Life Sciences
 Communications & Technology
 Environment & Renewable Energy
 Education & Social Infrastructure
• Technology
 Automation of operations
 Connectivity- Touch Points
 Integrated operations
 Surveillance & Security
 Disaster recovery and Back Up
• Human Capital
• Yes bank took various Initiatives in Human
Resources Management:
Retaining talented employees
Inculcating innovating thinking
Encouraging professional entrepreneurship
Looking Ahead
• Contemplating to offer stake in Yes Bank to a
foreign Player, if any, to tap foreign Markets
• Bank is seriously considering to proliferate in
small and medium towns seeking immense
growth potential.
• Kapoor perceives a growth rate of 70 to 90 %
through 2010.
• Expand retail banking and Microfinance.
Questions
• Has knowledge banking helped in
differentiation?
• Will concentration on niche market help in long
run?
• How far has focus of yes bank on advanced
technology and competent human resource been
useful to yes bank?
Thank you