A STUDY ON THE ANALYSIS OF RISK AND

RETURN MANAGEMENT WITH REFERENCE TO

AXIS BANK

A project report submitted to the Bangalore University in partial

fulfilment of the requirement for the award of the degree of

MASTER OF BUSINESS ADMINISTRATION

BANGALORE UNIVERSITY

SUBMITTED BY
SURAJ S KOTHARI
P03CJ22M015064
Under the Guidance of
Prof. NIVEDITHA K
Assistant Professor

DAYANADA SAGAR COLLEGE OF ARTS, SCIENCE AND COMMERCE

SHAVIGE MALLESHWARA HILLS, K.S LAYOUT, BANALORE- 560078
ACADEMIC YEAR 2023-2024
 DECLARATION BY THE STUDENT

I hereby declare that “A Study on the Analysis of Risk and Return Management
with reference to AXIS Bank” is the result of the project work carried out by me
under the guidance of Prof. Niveditha K in partial fulfillment for the award of
Master's Degree in Business Administration by Bangalore University.

I also declare that this project is the outcome of my own efforts and that it has not
been submitted to any other university or institute for the award of any other degree
or diploma or certificate.

Place : Bengaluru Signature of the Student

Date : ( SURAJ S KOTHARI )

 GUIDE CERTIFICATE

This is to certify that SURAJ S KOTHARI Reg no. (P03CJ22M015064) of third

semester of MBA has successfully completed the project report titled “A Study on
the Analysis of Risk and Return Management with reference to AXIS Bank”

During the academic year 2022-2024 in partial fulfilment of the requirement for the
award of the Degree of Master of Business Administration of Bangalore
University.

Place : Bengaluru Signature of the Guide

Date : (Prof. Niveditha K)

 ACKNOWLEDGEMENT

I have been fortunate enough to get great support and back from a host of
individuals to whom I should stay thankful.

I would therefore like to extend my gratitude to the following individuals without

whose corporation and help at each stage, successful completion of the project
would not have been possible.

I take opportunity to express my heartfelt thanks to Dr. B R Venkatesh, Director,

MBA-BU, Dayananda Sagar College of Arts, Science & Commerce, Bangalore, for
his support and corporation to undertake and complete the project work.

It gives me immense pleasure to record my thanks to my internal guide, Prof.

NIVEDITHA K, Dayananda Sagar College of Arts, Science & Commerce,
Bangalore, for his valuable guidance and untiring support and cooperation in
completing the project work.

I finally, thank for the patience and cooperation of all the faculty members, family
and companions without whom the endeavor would not been possible.

SURAJ S KOTHARI
P03CJ22M015064
 ABSTRACT

The study titled " “A Study on the Analysis of Risk and Return Management with
reference to AXIS Bank”, Bangalore" focuses on understanding and analyzing
the risk and return management practices employed by AXIS Bank in the context
of the broader banking sector. The study aims to gain insights into how AXIS
Bank, one of the leading private sector banks in India, manages various risks
inherent in its operations, with a specific focus on the Bangalore region.

The study begins by providing an overview of the banking sector's importance

and the need for effective risk management in maintaining financial stability and
safeguarding the interests of stakeholders. It delves into the different types of risks
faced by banks, including credit risk, market risk, operational risk, and liquidity
risk, among others.

The research methodology involves a combination of quantitative and qualitative

approaches. Primary data is collected through interviews and surveys conducted
with key personnel responsible for risk and return management within AXIS
Bank's Bangalore branch. The study also leverages secondary data from relevant
literature, reports, and regulatory guidelines to gain a comprehensive
understanding of risk and return management practices in the banking sector.

The analysis focuses on various aspects of risk and return management at AXIS
Bank, including risk and return identification, measurement, monitoring, and
mitigation strategies. It explores the bank's risk assessment frameworks, internal
control mechanisms, and compliance procedures. The study also investigates the
role of technology and data analytics in enhancing risk and return management
practices at AXIS Bank

Furthermore, the research assesses the effectiveness of AXIS Bank's risk and
return and management practices by evaluating key performance indicators, such
as non-performing assets (NPAs), capital adequacy ratios, and stress testing
results. It also considers the regulatory environment and the bank's adherence to
relevant guidelines and regulations set by the Reserve Bank of India (RBI).
 TABLE OF CONTENTS
Chapter Contents Page
No. No.
1 INTRODUCTION 1 - 23
1.1 INTRODUCTION
1.2 BACKGROUND OF THE STUDY

2 REVIEW OF LITERATURE 24 -28

2.1 REVIEW OF LITERATURE AND RESEARCH
GAP
3 RESEARCH METHODOLOGY 29 - 32
3.1 STATEMENT OF THE PROBLEM
3.2 NEED FOR THE STUDY
3.3 SCOPE OF THE STUDY
3.4 OBJECTIVES OF THE STUDY
3.5 SAMPLING
3.6 RESEARCH DESIGN
3.7 PLAN OF ANALYSIS
3.8 LIMITATIONS OF THE STUDY
3.9 CHAPTER SCHEME

4 BANK PROFILE 33 - 38
5 DATA ANALYSIS AND 39 - 75
INTERPRETATION
6 FINDINGS, CONCLUSION AND 76 - 80
RECOMMENDATIONS
6.1 FINDINGS
6.2 RECOMMENDATIONS
6.3 CONCLUSIONS
 LIST OF CHARTS
SL TITLE PAGE NO.
NO.
5.1.1 Preparedness for the new Basel proposal 39

5.12 Gap analysis 40

5.1.3 Priority to new Basel regulatory framework 42

5.1.4 The Basel Il Regulation in Perspective 43

52.1 Assignment of risk manager 45

5.22 Whom does risk manager report 46

52.3 Time dedication 47

5.2 4 The number of individuals who work. 49

52.5 Risk Committee 51

5.3.1 Reports generated for reporting ability 53

5.3.2 The Basel Il Regulation in Perspective 55

53.3 Assignment of risk manager 56

5.3.4 Whom does risk manager report 58

5.3.5 Time dedication 62

5.5.1 Approach that best suit organization 63

5.52 Cost/Benefit analysis 65

5.5.3 Regulatory capital consumption be motivation 67

5.5.1 Information technology infrastructure 69

5.52 Risk management IT solution 71

5.5.3 Difficulties you anticipate 72

 LIST OF GRAPHS

SL TITLE PAGE NO.

NO.
5.1.1 Preparedness for the new Basel proposal 40

5.12 Gap analysis 41

5.1.3 Priority to new Basel regulatory framework 43

5.1.4 The Basel Il Regulation in Perspective 45

52.1 Assignment of risk manager 46

5.22 Whom does risk manager report 47

52.3 Time dedication 48

5.2 4 The number of individuals who work. 49

52.5 Risk Committee 51

5.3.1 Reports generated for reporting ability 54

5.3.2 The Basel Il Regulation in Perspective 55

5.3.3 Assignment of risk manager 56

5.3.4 Whom does risk manager report 58

 CHAPTER 1

INTRODUCTION
 A STUDY ON THE ANALYSIS OF RISK AND RETURN MANAGEMENT AT AXIS BANK

1.1 INTRODUCTION
Risk and return management plays a critical role in the banking sector, where
institutions encounter a variety of risk and returns that can significantly affect
their financial stability and overall operations. Given the ever-changing and
competitive nature of the industry, effective risk and return management
practices become imperative to ensure the resilience and sustainability of
banks

This study delves into the examination of risk and return and return management
within the banking sector, with a particular emphasis on AXIS Bank in Bangalore.
As one of India's prominent private sector banks, AXIS Bank operates within a
dynamic environment, making it an intriguing case study for understanding risk and
return and return management practices within the banking sector.

The primary objective of this study is to analyze and assess the risk and return
management framework employed by AXIS Bank, specifically in the domains
of credit risk and return, market risk and return, and operational risk and
return. By scrutinizing AXIS Bank's risk and return management practices, the
aim is to gain insights into the strategies, processes, and tools used by the bank
to identify, evaluate, mitigate, and monitor risk and returns.

To accomplish this goal, a combination of primary and secondary research

methods will be utilized. Primary research will entail interviews with key
personnel responsible for risk and return management at AXIS Bank, while
secondary research will encompass a comprehensive review of academic
literature, regulatory guidelines, and industry reports relevant to risk and
return management within the banking sector.

In summary, this study seeks to advance our comprehension of risk and return
management practices in the banking sector, with a particular focus on AXIS
Bank in Bangalore. The insights garnered from this research will offer
valuable guidance for banks and financial institutions seeking to enhance their
risk and return management strategies and processes.

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1.2 BACKGROUND OF THE STUDY

Risk management refers to the systematic process of identifying, assessing,

and mitigating potential risks that may adversely impact an organization's
objectives. In the context of the banking sector, risk management involves
identifying and managing various types of risks to ensure the safety and
soundness of financial institutions. It is a crucial aspect of banking operations,
aiming to protect depositors' funds, maintain financial stability, and enable
sustainable growth.

Risk Management in the Banking Sector:

1.Identification of Risks:

Risk management in the banking sector involves the identification of various types
of risks faced by financial institutions. These risks can include credit risk (potential
default of borrowers), market risk (volatility in financial markets), liquidity risk
(inability to meet short term obligations), operational risk (internal processes and
systems), and regulatory and compliance risk (non-compliance with laws and
regulations).

2.Risk Assessment:

Once the risks are identified, banks assess their potential impact and likelihood
of occurrence. This involves evaluating the severity of potential losses and the
probability of risks materializing. Risk assessment enables banks to prioritize
their risk management efforts and allocate resources.

3.Risk Mitigation:

Risk management in the banking sector involves implementing strategies to

mitigate identified risks. This may include establishing risk control measures,
implementing robust internal controls and processes, Effective risk mitigation
measures aim to reduce the probability and impact of risks, enhancing the
overall resilience of the banking institution.

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4.Monitoring and Review:

Risk management is an ongoing process that requires continuous monitoring

and review. Banks need to establish mechanisms to monitor the effectiveness
of risk management measures, identify emerging risks, and make necessary
adjustments to their strategies. Regular reviews of risk management
frameworks and policies are essential to ensure their relevance and alignment
with evolving market conditions and regulatory requirements.

Return Management in Banking sector:

Return administration within the managing an account segment includes procedures

and hones banks utilize to maximize productivity whereas overseeing the dangers
related with their money related items, administrations, and speculations. This
administration is basic, as banks work in exceedingly controlled situations with
special challenges related to liquidity, credit hazard, and advertise vacillations. Here
are a few key components of return administration in keeping money:

1. Interest Rate Administration

Banks win most of their pay from the spread between the intrigued they charge on
advances and the intrigued they pay on stores. Effectively overseeing intrigued rate
hazard is basic, as vacillations can affect benefit. Numerous banks utilize intrigued
rate subordinates to support against rate developments.

2. Credit Risk Administration

Credits are a essential pay source for banks, but they moreover posture a credit
chance. Overseeing this chance includes assessing borrowers' financial soundness,
utilizing credit scoring models, and observing advance portfolios to guarantee
opportune installments. Non-performing advances (NPLs) straightforwardly affect
returns, so decreasing NPLs is fundamental.

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3. Portfolio Enhancement

Banks regularly expand their resource portfolios to decrease the concentration of

hazard and progress returns. Diversification can include contributing in different
businesses, geographic districts, and resource sorts (such as bonds, stocks, or
elective ventures).

4. Capital Allotment and Return on Equity (ROE)

Return administration requires banks to apportion capital to exercises with the most
noteworthy potential return relative to chance. ROE may be a basic metric, because
it speaks to how viably a bank produces benefit from its value. Banks regularly
utilize Financial Esteem Included (EVA) and Risk-Adjusted Return on Capital
(RAROC) to degree productivity in connection to the risk taken.

5. Liquidity Administration

Banks ought to adjust keeping up sufficient liquidity to meet administrative

prerequisites and oversee withdrawals whereas conveying overabundance liquidity
to win a return. Holding as well much fluid cash diminishes returns, whereas holding
as well small increments the hazard of a liquidity emergency.

6. Cost Efficiency and Operational Administration

Lessening operational costs without relinquishing benefit quality or hazard

administration may be a crucial component of return administration. Banks center
on computerized change, mechanizing forms, and optimizing department systems
to progress taken a toll productivity and eventually increment returns.

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IMPORTANCE OF RISK MANAGEMENT IN BANKING:

Safeguarding Financial Stability:

Risk management helps banks maintain financial stability by identifying,

assessing, and mitigating risks. It enables banks to anticipate and proactively
address potential threats to their financial health, such as credit risks, market
risks, liquidity risks, operational risks, and legal risks.

Minimizing Losses and Enhancing Profitability:

Effective risk management practices help banks minimize losses and enhance
profitability. By identifying and quantifying risks, banks can allocate
resources efficiently and make informed decisions about lending, investment,
and pricing. Rigorous credit risk assessments, for example, allow banks to
identify borrowers with higher probabilities of default

Regulatory Compliance:

In the banking sector, compliance with regulatory requirements is paramount.

Risk management frameworks help banks adhere to regulatory guidelines and
maintain compliance. Regulators, such as the Reserve Bank of India (RBI),

Enhancing Stakeholder Confidence:

A strong risk management framework enhances stakeholder confidence in the

banking sector. Customers, investors, and other stakeholders trust banks that
demonstrate effective risk management practices. By adopting robust risk
management frameworks,

Strengthening Corporate Governance:

Risk management is an integral component of sound corporate governance in the

banking sector. It ensures that banks operate within defined risk appetite and risk
tolerance levels. Risk management frameworks facilitate transparency,
accountability,

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IMPORTANCE OF RETURN MANAGEMENT IN BANKING:

1. Benefit and Monetary Health

• Return administration makes a difference banks to maximize their benefit edges

by guaranteeing that the returns on credits, speculations, and other money related
items are optimized.

2. Risk Administration

• Banks take on diverse sorts of dangers, such as credit chance, showcase hazard,
and liquidity hazard. Return administration makes a difference adjust these dangers
with anticipated returns, guaranteeing a steady risk-return profile.

3. Effective Capital Assignment

• Return administration empowers banks to designate capital to the foremost

beneficial zones, prioritizing high-return exercises over low-return or high-risk
exercises.

4. Competitive Situating

• Proficient return administration permits banks to offer competitive intrigued rates

to draw in clients whereas guaranteeing that these rates are beneficial.

5. Upgraded Client Fulfilment

• Viable return administration contributes to reasonable estimating of money related

items, such as credits, investment funds accounts, and venture alternatives, which
can lead to higher client fulfilment.

6. Administrative Compliance

• Banks work beneath strict administrative prerequisites, which regularly

incorporate benchmarks for return rates to anticipate intemperate risk-taking.

• Great return administration guarantees compliance with these controls, lessening

the probability of punishments or other administrative activities.

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TYPES OF RISKS FACED BY BANKS, WITH A SPECIFIC FOCUS ON THE

INDIAN BANKING SECTOR.

Credit Risk:

Credit risk is the most common type of risk faced by banks. It arises from the
potential default or failure of borrowers to repay their loans or meet their
contractual obligations. Banks face credit risk when they lend to individuals,
businesses, or other banks.

Market Risk:

Market risk refers to the potential losses that banks may face due to adverse
movements in market prices of financial instruments, including interest rates,
foreign exchange rates, commodity prices, and equity prices. Banks are
exposed to market risk through their trading and investment activities..

Operational Risk:

Operational risk arises from inadequate or failed internal processes, people,

systems, or external events. It includes risks related to technology failures,
fraud, human error, legal and regulatory compliance, and business disruptions.
Operational risk can result in financial losses, reputational damage, and legal
consequences.

Liquidity Risk

Liquidity risk refers to the risk of a bank being unable to meet its short-term
obligations or fund its operations without incurring excessive costs. It arises
from a mismatch between the bank's assets and liabilities, unexpected
withdrawal of deposits, or difficulty in accessing funds in the market.

Interest Rate Risk:

Interest rate risk is the potential impact on a bank's profitability and financial
condition due to changes in interest rates. Banks with significant fixed-rate
assets or liabilities are vulnerable to interest rate risk.

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Compliance and Regulatory Risk:

Banks face compliance and regulatory risks arising from non-compliance with
laws, regulations, and industry standards. Failure to comply with regulatory
requirements can result in fines, penalties, reputational damage, and loss of
license.

TYPES OF RETURNS IN BANKING SECTOR OR IN BANKS

1. Interest Income• Advances:

Intrigued wage from credits is one of the biggest sources of salary for banks. This
comes from loaning to people, enterprises, and other monetary teach.

• Securities:Banks contribute in bonds and other fixed-income securities, winning

intrigued as a return.

2. Fee-Based Income• Benefit Expenses:

These incorporate expenses for account upkeep, ATM utilize, overdrafts, and credit
card administrations.

• Venture Keeping money Expenses:For bigger banks, expenses for endorsing,

mergers, and admonitory administrations are noteworthy.

• Resource Administration Expenses Banks with resource administration

administrations win expenses based on the esteem of resources overseen on sake of
clients.

3. Trading Income• Market-Making:

Banks win a return by encouraging buying and offering in different securities

markets, capturing the bid-ask spread.

• Exclusive Exchanging:A few banks too lock in in exchanging with their possess
capital to capture cost developments in stocks, bonds, monetary standards, and other
resources.

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• Subsidiaries:Banks make returns by exchanging complex money related

disobedient like choices, prospects, and swaps. This may give significant returns but
too higher dangers.

4. Investment Returns• Value Ventures:

Banks regularly hold value in other companies or speculation reserves, producing

returns in the event that these resources appreciate or pay profits.

• Genuine Domain and Other Ventures:A few banks too contribute in genuine
bequest and other elective resources, contributing to non-interest salary through
appreciation, rents, or deals.

5. Capital Gains• Appreciation in Resources:

When banks offer assets, like securities or credits, at a better cost than the buy
fetched, they pick up capital returns.

• Resource Securitization:Banks now and then bundle credits into securities, such
as mortgage-backed securities, which they offer to financial specialists for a return.

6. Foreign Trade and Hedging Gains• Cash Exchanging:

Numerous huge banks effectively exchange monetary standards and pick up from
trade rate developments.

• Supporting:Returns are moreover created when supporting techniques viably

diminish misfortunes from changes in trade rates, intrigued rates, or other monetary
factors.

7. Dividend Income

• Subsidiaries and Speculations:Banks get profits from auxiliaries, speculations, and

money related rebellious such as favored stock.

Banks oversee these returns with methodologies planned to adjust chance and
return, pointing to optimize benefit whereas controlling introduction to dangers like
credit, advertise, and operational dangers.

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REGULATORY FRAMEWORK:

The Reserve Bank of India (RBI) serves as the central regulatory

authority for banks in India. It formulates and enforces policies,
guidelines, and regulations related to risk management. The regulatory
framework focuses on various aspects of risk, including credit risk,
market risk, operational risk, liquidity risk, and legal and reputational
risk.

Credit Risk Management:

To mitigate credit risk, banks in India are required to follow guidelines

provided by the RBI These guidelines include robust credit appraisal
procedures, strict loan classification norms, provisioning requirements, and
regular monitoring of loan portfolios. Banks are also required to maintain
adequate capital adequacy ratios to cushion against potential credit losses.
Market Risk Management:

The RBI mandates banks to maintain a sound framework for managing market
risks arising from interest rate risk, foreign exchange risk, and equity price
risk. Banks are required to implement risk management policies and systems
to monitor and control these risks effectively. The RBI also provides guidelines
on stress testing, value-at-risk (VaR) methodologies, and risk-based internal
capital adequacy assessment processes.

Operational Risk Management:

Operational risk management encompasses risks arising from inadequate or

failed internal processes, people, and systems, or from external events. The
RBI emphasizes the implementation of robust internal control systems, risk
assessment processes, and risk mitigation strategies. Banks are required to
adopt effective operational risk management frameworks and maintain
contingency plans to handle potential operational disruptions.

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Legal and Reputational Risk Management:

Recognizing the significance of legal and reputational risks, the RBI has
issued guidelines to ensure banks maintain high standards of ethical conduct
and legal compliance. Banks are expected to implement effective mechanisms
for identifying, monitoring, and managing these risks. Compliance with anti-
money laundering (AML) and know your customer (KYC) norms is crucial to
prevent legal and reputational risks.

Supervision and Enforcement:

The RBI conducts regular inspections and audits of banks to assess their risk
management practices. It provides guidance and corrective measures to
address any deficiencies identified during these inspections. The RBI also
imposes penalties and sanctions for non-compliance with risk management
guidelines to ensure adherence to regulatory requirements.

CREDIT RISK MANAGEMENT:

Understanding credit risk and its sources:

Credit risk refers to the potential loss a bank may face due to the failure of a
borrower or counterparty to fulfill their financial obligations. In the banking
sector, credit risk primarily arises from lending activities and arises from both
individual borrowers and portfolio-level risks. Sources of credit risk include
default on loans, delayed or missed payments, bankruptcy, and economic
downturns.

Credit risk assessment and measurement techniques:

To effectively manage credit risk, banks employ various assessment and

measurement techniques. These techniques include. Credit Scoring: Banks use
statistical models to assess the creditworthiness of borrowers based on factors such
as income, repayment history, and collateral.

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Financial Statement Analysis: Banks analyze the financial statements of

borrowers to evaluate their financial health and repayment capacity.

Loan-to-Value (LTV) Ratio: LTV ratio measures the loan amount relative to
the value of the underlying collateral. Higher LTV ratios indicate higher credit
risk.

Stress Testing: Banks conduct stress tests to evaluate the potential impact of
adverse scenarios on their credit portfolio and assess their resilience to economic
downturns.

Credit risk mitigation strategies and tools:

To mitigate credit risk, banks employ several strategies and tools, including:

Diversification: Banks diversify their loan portfolios across different sectors,

industries, and geographical regions to reduce concentration risk.

Collateral: Banks often require borrowers to provide collateral, such as property

or assets, which can be seized in the event of default to cover potential losses.

Guarantees and Insurance: Banks may seek guarantees from third parties or
require borrowers to obtain credit insurance to minimize potential losses.

Market Risk Management:

Overview of market risk and its types:

Market risk refers to the potential for financial losses resulting from adverse
changes in market prices and rates. It encompasses various types of risks,
including:

Interest Rate Risk: This risk arises from fluctuations in interest rates, impacting
the profitability and value of a bank's assets and liabilities. Changes in interest

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Foreign Exchange Risk: It pertains to the potential losses arising from adverse
movements in foreign exchange rates. Banks that engage in international
operations or have exposure to foreign currencies face this risk.

Equity Risk: It relates to the exposure of a bank's equity investments to

fluctuations in stock prices. Changes in equity prices can impact a bank's
investment portfolio, equity holdings, and capital adequacy.

Market risk measurement models and techniques:

To quantify and manage market risk, banks employ various measurement

models and techniques, such as.

Value at Risk (VaR): VaR estimates the potential loss in a bank's portfolio over
a specific time horizon, with a given confidence level. It helps banks determine
the maximum loss they can incur and allocate capital accordingly

Stress Testing: Stress testing involves subjecting a bank's portfolio to extreme

scenarios to assess its resilience. Banks simulate adverse market conditions,
such as significant interest rate changes or market crashes, to evaluate the
potential impact on their portfolios.

Backtesting: Backtesting involves comparing the actual outcomes of a bank's

risk positions with the predictions made by risk models. It helps banks assess
the accuracy and reliability of their risk measurement models.

Hedging and risk mitigation strategies for market risk:

To mitigate market risk, banks employ various hedging and risk mitigation
strategies, including Derivatives Hedging: Banks use derivatives, such as
interest rate swaps, futures, options, and forwards, to hedge against adverse
market movements. Derivatives allow banks to transfer or reduce their
exposure to market risks.

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OPERATIONAL RISK MANAGEMENT:

Definition and Sources of Operational Risk:

Operational risk refers to the potential loss resulting from inadequate or failed
internal processes, people, or systems, or from external events. It includes
risks arising from human error, fraud, legal and regulatory compliance
failures, technology failures, and business disruptions. In the banking sector,
operational risks can arise from various sources, including•

Internal Sources: These risks stem from within the organization and include
errors in transaction processing, employee misconduct, inadequate internal
controls, and insufficient staff training

External Sources: Operational risks can also originate from external factors,
such as natural disasters, cyberattacks, supplier failures, changes in regulatory
requirements, or geopolitical events.

Operational Risk Assessment and Measurement Approaches:

To effectively manage operational risk, banks employ various assessment and

measurement approaches, including•

Risk Identification: Banks identify potential operational risks through

comprehensive risk assessments, internal audits, and process mapping
exercises. This helps in recognizing and understanding the specific operational
risks faced by the organization.

Risk Quantification: Once identified, banks quantify operational risks using

various metrics, such as Key Risk Indicators (KRIs) and Loss Data Collection
(LDC). KRIS provide early warning signals by monitoring the factors that
indicate an increased likelihood of operational losses. LDC involves analyzing
historical loss data to estimate potential future losses.

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Administrative system for return administration within the Indian banking sector.
Each segment can be extended as vital to fit the specified length, giving a organized,
in-depth investigation.

1. Introduction to Return Administration in Managing an account

• Definition of Return Administration:
Diagram of return administration, which involves maximizing benefit whereas
adjusting dangers, resources, and costs in managing an account operations.
• Significance in Managing an account:
Part of return administration in accomplishing a feasible money related execution,
administrative compliance, and assembly partner desires.
• Overview of the Administrative Environment:
Presentation to the administrative scene in India, covering offices just like the Save
Bank of India (RBI) and significant acts.

2.Administrative Bodies Administering Return Administration

• Save Bank of India (RBI):
Part of the RBI as the essential administrative specialist managing keeping money
operations, guaranteeing soundness and productivity.
• Securities and Trade Board of India (SEBI):
For open banks, SEBI controls stock trades and securities markets, affecting return
divulgences and financial specialist straightforwardness.
• Service of Fund (MoF):
Its impact on approach changes, taxations, and other macroeconomic controls
influencing bank returns.
• Other Pertinent Substances:
Incorporate the role of substances just like the National Bank for Farming and Rustic
Advancement (NABARD) and their impact on sector-specific returns, like
horticulture and country keeping money.

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3. Key Controls Influencing Return Administration in Banks

• RBI Rules on Productivity and Returns:
RBI orders that banks keep up straightforwardness in detailing returns, guaranteeing
revelations of dangers and returns.
• Basel III System:
The worldwide Basel III directions have been embraced in India to guarantee
satisfactory capital to cover risks and enhance versatility.
• Capital Ampleness Proportion (CAR):
The necessity for banks to hold a least sum of capital as a rate of risk-weighted
resources.
• Liquidity Scope Proportion (LCR) and Net Steady Financing Proportion (NSFR):
Proportions presented to make strides banks' liquidity and long-term financing
solidness.
• Wage Acknowledgment and Resource Classification (IRAC) Standards:
RBI's standards on non-performing resources (NPAs) straightforwardly affect
banks' returns by requiring clear classifications and arrangements.
• Need Segment Loaning (PSL):
RBI commands a certain rate of bank credit to be expanded to priority divisions like
horticulture, MSMEs, which can affect return proportions.
• Prudential Norms on Speculations and Advance Quality:
Rules for overseeing advance portfolio quality, guaranteeing suitable credit
misfortune arrangements, and keeping up resource quality.

4. Detailing and Disclosure Requirements

• RBI Commanded Divulgences:
Banks must give standard divulgences, counting money related explanations, key
proportions, resource classifications, chance administration hones, etc.

SEBI's Part in Money related Detailing:

Open banks must follow to SEBI's standards on occasional money related
divulgences, administration, and straightforwardness in detailing returns.

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• Statutory Detailing Prerequisites:

Compliance with the Keeping money Direction Act, 1949, and Companies Act,
2013, which require banks to routinely report their execution and money related
wellbeing.

5. Risk Administration System

• Chance Administration Rules by RBI:
RBI has issued rules for credit hazard, showcase hazard, operational hazard, and
other dangers to secure returns from potential misfortunes.
• Inside Capital Ampleness Appraisal Prepare (ICAAP):
Necessity beneath Basel III for banks to create and report their chance evaluation
and capital ampleness arranging.
• Push Testing and Affectability Investigation:
RBI orders banks to perform occasional push tests, permitting them to gage the
potential affect of unfavorable conditions on returns.
• Resource Risk Administration (ALM):
System to oversee intrigued rate chance, liquidity hazard, and money dangers,
guaranteeing adjusted returns.

6. Administrative Arrangements and Compliance Prerequisites

• Corporate Administration Standards:
RBI orders sound administration hones, guaranteeing straightforwardness,
responsibility, and moral administration.
• Review and Review:
Prerequisite for standard inner and outside reviews, guaranteeing compliance with
administrative standards that affect returns.
• Compliance with Anti-Money Washing (AML) Directions:
To dodge punishments that might affect bank productivity and notoriety, Indian
banks must follow to AML standards.

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7. Challenges in Administrative Compliance for Return Administration

• Overseeing NPAs:
Tending to tall NPA levels remains a key challenge, as banks must make
arrangements for NPAs, affecting returns.
• Adjusting Productivity and Compliance:
Adjusting administrative compliance with productivity, particularly given
necessities like PSL.
• Fetched of Compliance and Innovative Overhauls:
Overseeing the costs related with compliance forms and innovative progressions
required for strong return administration.

8. Later Improvements and Advancements in Administrative Systems

• Advanced Keeping money and Administrative Alterations:
Unused RBI rules to oblige computerized keeping money hones and how this
influences returns.
• Presentation of Unused Money related Rebellious:
Rising systems for advanced resources, cryptocurrencies, and their potential impact
on returns.
• Government Plans and Affect on Returns:
Activities like Jan Dhan Yojana, Mudra Credits, and their administrative affect on
the benefit of banks.

This framework provides an organized and detailed outline, fitting the required five-
page length when expanded with supporting details, tables, and examples where
relevant. Let me know if you’d like more details on any specific section!

RBI's Part in Organizing Return on Resources (ROA) and Return on Value (ROE)
• Orders on ROA and ROE:
The RBI doesn't unequivocally set targets for ROA or ROE but impacts these
returns by implication through administrative capital prerequisites, resource
classification standards, and provisioning prerequisites. RBI empowers banks to
preserve sound proportions as markers of monetary wellbeing and versatility.

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• Non-Performing Resources (NPA) Affect:

As NPAs decrease ROA and ROE, the RBI has set rules on handling NPAs,
including instruments just like the Bankruptcy and Insolvency Code (IBC) and
resource recreation companies (Bends). These systems offer assistance banks
recuperate awful obligations, specifically making strides ROA.
• Extraordinary Say Accounts (SMA):
RBI presented SMA to avoid resource quality weakening. SMA classification aids
in early acknowledgment of focused resources, permitting banks to require remedial
activities to stabilize their returns.

Basel III's Particular Affect on Indian Banks' Returns

• Energetic Capital Buffers:
Indian banks are required to preserve Countercyclical Capital Buffers (CCyB),
empowering them to assimilate stuns amid financial downturns without essentially
influencing returns.
• Risk-Weighted Resources (RWA) Calculation Alterations:
Alterations within the calculation of RWAs beneath Basel III straightforwardly
affect the ROA and ROE of banks. By requiring banks to evaluate credit,
operational, and advertise dangers in calculating RWAs, Basel III in a roundabout
way presses banks to seek after more secure, lower-risk resources to upgrade
returns.
• Usage Phases:
The RBI has deliberately executed Basel III in stages, altering due dates and
prerequisites based on the managing an account sector's readiness and financial
conditions, making a difference banks steadily alter return administration systems.

Regulatory Push for Innovation Selection and Its Affect on Returns

• Innovation as a Compliance Apparatus:
RBI's later directions empower digitalization to progress compliance, extortion
location, and operational productivity. Ventures in AI and huge information
analytics offer assistance banks superior oversee dangers, driving to more steady
returns.

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• Computerized Keeping money Units (DBUs):

To advance monetary consideration and productivity, RBI energized setting up
DBUs. This brings down operational costs for banks, permitting them to optimize
returns whereas meeting compliance and incorporation objectives.
• Know Your Client (KYC) Standards and e-KYC:
Strict KYC controls point to diminish monetary wrongdoing dangers, which in turn
ensures returns by minimizing fraud and non-recoverable misfortunes.

Extraordinary Return Administration Rules for Open and Private Division Banks
• Contrasts in Administrative Desires:
Open segment banks (PSBs) regularly confront stricter social commitments beneath
PSL standards, whereas private banks appreciate moderately more adaptability.

Conclusion
Summary of Regulatory Impact: Recap of how the regulatory framework in India
affects return management in banks.
The Way Forward: Emphasize the need for ongoing reforms, technology adoption,
and improved governance for sustainable returns.
Future of Return Management: Envision the future landscape of Indian banking
return management as compliance, technology, and customer-centric approaches
continue to evolve.

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Technological Progressions and Their Effect on Risk and Return Management

within the Banking Sector

• Setting:
Clarify the advancing part of innovation in budgetary administrations. Talk about
the significance of overseeing dangers and returns for banks.
• Proposal Explanation:
Innovative progressions have changed risk and return administration within the
managing an account division, upgrading proficiency, precision, and key decision-
making whereas presenting modern dangers.
• Objective:
Layout what the paper will cover, such as progressions like enormous information
analytics, counterfeit insights, and blockchain, and their impacts on chance and
return.

1. Outline of Hazard and Return in Managing an account

• Characterize Key Concepts:
• Hazard Administration:
The method by which banks distinguish, survey, and relieve potential misfortunes.
• Return Administration:
Procedures to maximize productivity and shareholder esteem whereas keeping up
solidness.
• Significance of Adjusting Hazard and Return:
Clarify why adjusting these is central to managing an account operations,
soundness, and administrative compliance.

2. Key Mechanical Progressions Affecting Keeping money

• Enormous Information Analytics:
Utilize of massive datasets for prescient examination, client bits of knowledge, and
improved chance appraisal.
• Manufactured Insights (AI) and Machine Learning (ML):
Calculations for prescient modeling, extortion discovery, and credit scoring.

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• Blockchain Innovation:
Conveyed record frameworks, potential for secure exchanges, and shrewd contracts.
• Cloud Computing:
Get to to endless computational assets and information capacity arrangements.
• Mechanical Prepare Robotization (RPA):
Mechanizing monotonous, rule-based forms to diminish mistake and make strides
effectiveness.

3. Affect of Innovation on Hazard Administration in Managing an account

• Upgraded Information Examination and Prescient Modeling:
• Huge information and AI permit for real-time checking and investigation of
advertise conditions, enhancing credit hazard evaluation and empowering early
discovery of money related abnormalities.
• Extortion Discovery and Cybersecurity:
• AI-based devices offer assistance identify extortion designs and diminish fraud-
related misfortunes.
• In any case, expanded reliance on advanced frameworks can increase
cybersecurity dangers, which banks must oversee effectively.
• Administrative Compliance:
• Administrative advances (RegTech) fueled by AI offer assistance banks guarantee
compliance with ever-evolving monetary directions.
• Operational Productivity in Hazard Administration:
• Innovations like RPA streamline compliance checks, decreasing operational
chance and sparing time.

4. Affect of Innovation on Return Administration in Managing an account

• Made strides Client Experiences and Personalization:
• Enormous information and AI improve client division, permitting banks to offer
personalized items, which makes strides client fulfillment and devotion.
• Optimized Venture Procedures:
• AI and ML can optimize portfolio administration and exchanging possibly

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Taken a toll Decrease and Proficiency Picks up:

• Robotization and cloud arrangements decrease overhead costs, liberating up assets
to improve benefit edges.
• Advertise Extension through Computerized Keeping money:
• Advanced stages empower banks to reach already underserved markets, making
unused income streams.

5. Challenges and Dangers Related with Innovative Headways

• Cybersecurity Dangers:
• Progressed hacking methods posture dangers to computerized managing an
account frameworks and information judgment.
• Information Security Concerns:
• Taking care of endless sums of client information postures noteworthy protection
challenges, with suggestions for compliance and notoriety.
• Operational Dangers:
• Reliance on complex innovations can lead to framework disappointments or
mistakes in decision-making in case not carefully overseen.
• Administrative Challenges:
• Quick innovation appropriation regularly outpaces administrative systems, making
compliance vulnerabilities.

6. Future Patterns and Viewpoint for Mechanical Integration in Managing an

account
• Expanded AI Selection:
AI's part in real-time chance investigation, portfolio optimization, and client
interaction will extend.
• Integration of Decentralized Fund (DeFi):
Blockchain innovation might empower modern shapes of secure, decentralized
budgetary exchanges.
• Utilize of Quantum Computing:
Potential to revolutionize encryption and hazard modeling, in spite of the fact that
it's still in early stages.

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• Maintainability and Green Managing an account Innovations:

With developing center on ESG (natural, social, and administration), banks are
investigating ways to join innovation for more economical operations.

• Rundown of Key Focuses:

Emphasize the affect of mechanical progressions on chance and return
administration, adjusting the benefits with the unused dangers presented.
• Last Contemplations:
Emphasize that banks must proactively adjust to innovative changes, leveraging
advancement whereas carefully overseeing related dangers.

This structure ought to assist you organize each page, with a adjust between
presenting innovation concepts, analyzing their impacts, and examining challenges.
For each segment, you'll advance expound by joining real-world illustrations, later
considers, or case thinks about to enhance the substance.

Key Innovations Executed by Axis Bank

1. Enormous Information Analytics and Manufactured Insights (AI):

• Axis Bank has contributed intensely in information analytics to pick up
experiences into client behavior, credit chance, and advertise patterns. By analyzing
exchange information and client profiles, the bank can more precisely evaluate
financial soundness and oversee advance hazard.
• The bank employments AI for prescient modeling, which makes a difference in
distinguishing early caution signals for potential defaults. This approach permits for
proactive hazard administration, especially in retail and corporate loaning.

2. Machine Learning for Extortion Location:

• Axis Bank utilizes machine learning models to identify and anticipate false
exchanges in real-time. By analyzing exchange designs and behavioral
inconsistencies, the bank can hail suspicious exercises rapidly, which decreases
fraud-related misfortunes and upgrades security.

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• This innovation moreover makes a difference in lessening untrue positives,

moving forward the client involvement by minimizing disturbances in true blue
exchanges.

3. Blockchain for Secure Exchanges:

• In spite of the fact that still in exploratory stages, Axis Bank has been testing with
blockchain innovation for cross-border installments and exchange back.
Blockchain's dispersed record framework permits for straightforward and tamper-
proof exchanges, which decreases counterparty dangers and upgrades the
effectiveness of universal exchanges.

4. Cloud Computing and Advanced Stages:

• Axis Bank has received cloud-based arrangements to bolster its computerized
managing an account administrations. This empowers it to scale its administrations
effectively and gives clients with quick, dependable online managing an account
choices, which is basic for assembly the requests of a digitally-savvy client base.
• Moreover, advanced loaning stages permit Axis Bank to extend its reach and
streamline advance handling, essentially lessening time-to-approval and boosting
client fulfillment.

5. Automated Prepare Robotization (RPA) for Operational Proficiency:

• The bank employments RPA to robotize schedule errands, such as compliance
checks and information passage, lessening operational dangers and moving forward
efficiency. By mechanizing these forms, Axis Bank can center its workforce on
higher-value assignments, in this way improving by and large returns.

Impacts on Chance and Return Administration

Axis Bank's selection of these innovations has driven to a few advancements in its
chance and return administration hones:
• Improved Hazard Control:
With AI and huge information, Axis Bank has created a more vigorous credit hazard
appraisal demonstrate. This brings down the hazard of non-performing resources
(NPAs) and progresses the bank's advance portfolio quality.

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• Expanded Return on Venture (ROI):

Robotization and analytics empower Axis Bank to decrease costs whereas making
strides client benefit and item offerings. Personalized budgetary items created
through information analytics boost client engagement

Axis Bank's approach to computerized change is comprehensive, expanding from

client benefit upgrades to center hazard administration forms. In later a long time,
the bank has prioritized advanced advancement through organizations with fintech
companies and ventures in its claim innovation foundation. For occurrence, Axis
Bank collaborates with fintech new businesses to co-create computerized loaning
arrangements, empowering speedier credit evaluation and customized advance
items. These collaborations not as it were make strides client securing but moreover
fortify Axis Bank's competitive situating in India's fast-evolving budgetary division.

Moreover, Axis Bank utilizes machine learning in its anti-money washing (AML)
and compliance frameworks. By analyzing endless sums of information from
numerous sources, machine learning calculations can identify suspicious exchanges
more viably than conventional strategies. This proactive approach diminishes
legitimate dangers and guarantees arrangement with administrative necessities.

Axis Bank has moreover grasped versatile keeping money as a channel for secure,
helpful administrations, coming about in a noteworthy increment in advanced
exchanges. The bank's versatile app, with highlights fueled by AI, makes a
difference clients make educated venture choices, which upgrades return
administration. By extending its advanced administrations and coordination these
advances, Axis Bank isn't as it were moderating operational and credit dangers but
too driving benefit through development and customer-focused techniques.

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CHAPTER 2

BANK PROFILE
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Axis Bank is one of the biggest private division banks in India, giving a wide extend
of monetary administrations to people, corporates, little and medium ventures, and
the rural division. Built up in 1993 as UTI Bank, the institution was afterward
rebranded to Axis Bank in 2007. Known for its mechanical developments and
customer-focused approach, Axis Bank has built a solid notoriety within the
managing an account and money related industry.

Key Information

• Headquarters: Mumbai, Maharashtra, India

• Established: 1993 (as UTI Bank), Rebranded in 2007 to Axis Bank

• Chairman: Rakesh Makhija

• CEO and Managing Executive: Amitabh Chaudhry

• Market Presence:
Over 4,500 domestic branches and 11,000+ ATMs over India, together with
universal workplaces in Singapore, Dubai, Colombo, and others.

• Stock Exchange Listings:

Recorded on the Bombay Stock Trade (BSE) and National Stock Trade (NSE) in
India

Business Sections
Axis Bank works in a few key zones of managing an account and back:
1. Retail Managing an account:
Gives investment funds accounts, settled stores, individual credits, credit cards, and
riches administration administrations.

2. Corporate Managing an account:

Offers a run of administrations like working capital advances, exchange fund,
treasury administrations, and exchange keeping money.

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3. SME Managing an account:

Gives customized arrangements like credits, cash administration, and counseling
administrations for little and medium-sized ventures.

4. Treasury Operations:
Oversees speculations in government and corporate securities, foreign trade, and
subsidiaries.

Key Products and Administrations

1. Accounts:
Investment funds, current, compensation, and settled store accounts with different
benefits custom-made to diverse client needs.

2. Credits:
Individual, domestic, auto, instruction, and commerce advances with competitive
intrigued rates and adaptable reimbursement choices.

3. Credit Cards:
A wide run of credit cards including travel, way of life, and shopping cards.

4. Riches Administration:
Custom fitted administrations like speculation arranging, portfolio administration,
and charge arrangements for high-net-worth people.

5. Protections and Investment Items:

Axis Bank offers shared stores, life and common protections, and speculation
admonitory administrations.

6. Computerized Managing an account:

Axis Bank has been at the bleeding edge of computerized developments, giving
administrations like versatile managing an account, web keeping money, UPI
exchanges, and a comprehensive portable app.

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Technological Progressions

Axis Bank has contributed intensely in innovation to streamline operations, oversee

dangers, and move forward client involvement:

• Manufactured Insights (AI) and Machine Learning (ML):

Utilized for chance evaluation, client benefit through chatbots, and extortion
discovery.

• Blockchain:
For secure exchanges, particularly in exchange back and cross-border installments.
• Information Analytics:
To upgrade personalized administrations, progress client experiences, and optimize
return on venture.

Cybersecurity:
Vigorous frameworks in put to secure client information and exchanges, leveraging
encryption and two-factor confirmation.
• Automation:
Robotized forms in advance endorsement, KYC, and account administration to
diminish time and operational costs.

Financial Performance
Axis Bank has appeared consistent development in terms of income, benefit, and
resources:

• Income:
Created fundamentally through intrigued wage, fee-based salary, and other
budgetary administrations.

• Net Benefit:
Axis Bank has kept up a solid benefit record with nonstop changes in resource
quality and cost-efficiency.

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• Net Intrigued Edge (NIM):

The bank has reliably detailed solid NIM, a key marker of productivity.

• Resource Quality:
Axis Bank has overseen to keep its non-performing resources (NPAs) beneath
control through moved forward hazard administration procedures.

Corporate Social Responsibility (CSR)

Axis Bank Establishment (ABF) initiates the CSR exercises, centering on
instruction, healthcare, feasible jobs, and natural preservation. ABF has embraced
activities like monetary education programs, expertise improvement for the rustic
workforce, and bolster for healthcare administrations in underprivileged ranges.

Key Accomplishments and Acknowledgment

• Reliably positioned among the best private division banks in India by different
monetary educate and media.
* Recognized for its computerized keeping money activities and customer-centric
approach.
* Gotten a few grants for brilliance in corporate administration, chance
administration, and operational proficiency.

Challenges and Future Viewpoint

Axis Bank, like other Indian banks, faces challenges such as keeping up resource
quality, overseeing NPAs, adjusting to administrative changes, and remaining
competitive with fintech firms. Be that as it may, with its solid center on advanced
change and inventive budgetary items, the bank is well-positioned for maintainable
development within the coming a long time.

International Presence
Axis Bank's universal operations back its developing exchange fund, corporate
managing an account, and settlement businesses, improving its worldwide
impression an expanding income

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1. Bharat Banking Initiative:

To grow provincial keeping money administrations, Axis Bank propelled its Bharat
Managing an account Activity, centering on country and semi-urban regions. This
incorporates customized items, low-cost exchanges, and computerized keeping
money custom fitted for rustic clients.
2. Axis 2.0 Strategy:
Presented by CEO Amitabh Chaudhry, Axis 2.0 centers on customer-centric
change, upgrading computerized capabilities, making strides credit quality, and
growing showcase share in retail and SME portions.
3. One Axis Strategy:
A key approach to cross-sell Axis Bank's offerings, bringing together managing an
account, protections, ventures, and loaning into one coordinates arrangement. This
methodology points to use the bank's differing portfolio to extend income per client.

Associations and Unions

• Fintech Organizations:
Axis Bank has joined forces with driving fintech companies to improve
computerized keeping money. For illustration, it collaborates with companies like
Razorpay and Paytm for UPI and computerized installment arrangements.
• Bajaj Finserv Association:
Axis Bank collaborated with Bajaj Finserv to co-create different money related
items like co-branded credit cards, advertising custom-made rewards and benefits.
• Worldwide Organizations:
The bank works with universal banks and money related teach for remote trade,
exchange back, and cross-border exchanges, counting with Quick for secure,
universal exchanges.

Advanced and Innovation Stages

1. Versatile Keeping money (Axis Versatile):
Axis Bank's portable app offers a wide extend of administrations, from support
exchanges and charge installments to individual fund administration devices. Axis
Versatile is known for its user-friendly interface and strong security.

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2. Web Keeping money (Axis Bank Web Managing an account):

The stage permits clients to perform online managing an account assignments such
as account administration, credit card administration, venture administrations, and
advance adjusting.

3. Advanced Loaning (Sparsh):

Axis Bank has an AI-based advanced lending platform called Sparsh that
employments machine learning calculations for fast credit appraisals, advertising
individual and trade credits with negligible printed material.

4. Burgundy Riches Administration App:

Burgundy, the premium riches administration benefit by Axis Bank, moreover
incorporates a committed app for high-net-worth clients, advertising portfolio bits
of knowledge, speculation following, and showcase overhauls.

Auxiliaries and Related Wanders

Axis Bank has a few backups and joint wanders that expand its offerings:

1. Axis Securities:
This backup gives stockbroking, venture counseling, and portfolio administration
administrations, permitting clients to contribute in values, shared reserves, and other
resources.

2. Axis Common Finance:

Works as Axis Resource Administration Company, advertising a wide run of
common finance plans, counting value, obligation, crossover, and topical reserves.

3. Axis Finance:
A Non-Banking Monetary Company (NBFC) centered on advances for businesses,
genuine domain financing, and individual loaning arrangements for high-value
clients.

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4. Axis Capital:
This backup handles venture managing an account exercises, counting
guaranteeing, IPO administration, corporate fund, and counseling administrations.
5. Freecharge:
Procured in 2017, Freecharge could be a advanced installment benefit and e-wallet
stage coordinates with Axis Bank's advanced offerings for consistent installments.

Innovative Products and Services

1. Vistara Co-Branded Credit Cards:

• Axis Bank Vistara Credit Card:
Created in organization with Vistara Aircrafts, these cards offer elite travel benefits
like complimentary aircraft tickets, quickened Club Vistara focuses, air terminal
relax get to, and need check-in. There are distinctive levels, counting the
Interminable, Signature, and Essential cards, each with interesting travel advantages
custom fitted for visit travelers.

2. Advanced Credit Items:

• Instant Individual Credits:
Through Axis Bank's versatile app and web keeping money, clients can apply for
individual credits online with moment endorsement and disbursal, leveraging AI-
based credit evaluations.
• Buy Now, Pay Later (BNPL):
Axis Bank offers a BNPL benefit in collaboration with online retail accomplices,
permitting clients to create buys on credit and reimburse over a brief length, with
negligible intrigued and expenses.

3. NRI Managing an account Administrations:

• RemitMoney:
Axis Bank's RemitMoney platform gives NRIs with a web stage to exchange cash
to India rapidly, advertising competitive trade rates, quick exchanges, and an easy-
to-use interface.

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• NRI Family Banking:

A special benefit that permits NRIs to open and oversee accounts for their families
in India, giving consistent monetary administration over borders.

4. Wearable Contactless Installments:

• Axis Wear 'N' Pay:
A collection of wearables, counting keychains, wristbands, and circles, that permit
clients to form contactless installments essentially by tapping the wearable on any
consistent installment terminal.
• Axis Bank Pro Combination Band:
A wellness band coordinates with installment capabilities, letting clients make
contactless installments, track wellness objectives, and more.

5. Secure+ Debit Card:

• A charge card that provides misplaced card security and crisis help administrations
universally. It too incorporates benefits like card-related extortion protections and
ATM emergency cash help.

6. Open APIs for Business Clients:

• Axis Bank gives open APIs for corporate clients, permitting them to coordinated
managing an account administrations straightforwardly into their possess
frameworks. These APIs support administrations like finance exchanges, account
explanations, real-time installments, and cash administration, enabling businesses
to streamline budgetary operations inside their existing computer program.

7. Dealer Arrangements:
• CRED and Neo Card for Shippers:
Axis Bank collaborates with CRED and other fintech stages to supply co-branded
installment arrangements for little shippers and business visionaries. These
arrangements frequently come with moo exchange expenses, dependability focuses,
and other benefits.

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• POS and mPOS Arrangements:

Axis Bank offers a extend of Point-of-Sale (POS) and portable POS arrangements
that permit businesses to acknowledge installments in-store and on the go, beside
value-added administrations like information analytics and real time.

9. Smart Privileges:
• Axis Bank Benefit Program:
A rewards program that gives extraordinary benefits over different categories, such
as way of life, eating, travel, and shopping. The bank has tie-ups with beat brands
to offer clients select rebates and cashback offers.

10. Riches Administration & Speculation Instruments:

• Common Support Coordinate Venture Stage:
Clients can contribute in common reserves specifically through Axis Bank's stage,
advertising highlights like zero commission, goal-based arranging, and following of
venture execution.

• Axis Coordinate Coordinates Venture Administrations:

Axis Coordinate could be a committed stage for stock showcase ventures,
permitting clients to exchange stocks, ETFs, and shared reserves. The benefit is
coordinates with Axis Bank accounts for consistent finance exchanges and real-time
overhauls.

11. Micro-Savings Item (Axis ASAP):

• A advanced reserve funds account pointed at empowering little investment funds
among clients who may not have full get to to keeping money. With negligible
documentation, clients can start saving with little sums, and it is additionally
coordinates with goal-based investment funds highlights.

12. Digital Gold:

• Axis Bank offers clients the alternative to purchase, offer, and store advanced gold
in little amounts through its portable app. gold suppliers to offer competitive costs
and secure capacity for clients who incline toward to contribute in gold carefully.

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13. SmartHome Credits:

• Axis Bank's SmartHome credits permit borrowers to decrease intrigued on their
domestic advances by connecting them with investment funds accounts. Overflow
stores within the connected reserve funds account offer assistance diminish the
central extraordinary, successfully bringing down intrigued.

14. Corporate Salary Account (Control Salute):

• Axis Bank offers specialized salary accounts for defense faculty, police strengths,
and government workers, including select benefits like zero adjust necessities, tall
withdrawal limits, protections scope, and more.

15. Axis Inaccessible Keeping money:

• A benefit that permits clients to perform different managing an account capacities
without going to a department. With inaccessible advisors accessible over video
calls, clients can conduct KYC overhauls, advance applications, and venture
counseling sessions from their homes.

16. Purchase Forex Online:

• Through the Axis Forex Online stage, clients can buy outside money, stack it onto
paid ahead of time travel cards, or ask domestic conveyance of money. The stage
gives competitive trade rates and permits simple administration of forex needs for
worldwide travelers.

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CHAPTER 3

RESEARCH METHODOLOGY
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3.1 STATEMENT OF THE PROBLEM

In the highly competitive and dynamic banking industry, compelling risk and return
administration is vital for monetary stability and development. Axis Bank, being
one of India's unmistakable private division banks, experiences different sorts of
dangers, such as credit, advertise, and operational dangers, which can affect its
benefit and maintainability. The bank's capacity to evaluate, relieve, and adjust these
dangers whereas guaranteeing satisfactory returns is basic to keeping up speculator
certainty and accomplishing long-term development. Be that as it may, overseeing
these dangers whereas optimizing returns presents significant challenges,
particularly within the setting of advancing administrative necessities, innovative
headways, and financial vacillations.

This study points to analyze the risk and return management techniques embraced
by Axis Bank, looking at their viability in minimizing potential misfortunes and
upgrading returns. Through this inquire about, the objective is to pick up bits of
knowledge into the bank's approaches to hazard recognizable proof, evaluation,
relief, and control, and assess how these contribute to its by and large money related
execution. This investigation will give a comprehensive understanding of the
current chance administration hones at Axis Bank and propose zones for change to
fortify its risk-return profile.

3.2 NEED OF THE STUDY

Understand Risk-Return Balance:

To investigate how Axis Bank recognizes and oversees different sorts of dangers
whereas pointing to maximize returns, contributing to a adjusted and feasible
development technique.
2. Evaluate Risk Administration Practices:
To survey the viability of Axis Bank's chance administration procedures in relieving
potential misfortunes, especially in ranges such as credit, showcase, and operational
dangers.

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3. Benchmark Industry Practices:

To analyze Axis Bank's procedures within the setting of industry measures and
administrative desires, giving experiences into how it compares with peer teach in
chance and return administration.
4. Help Stakeholder Decision-Making:
The discoveries can serve as a asset for partners, counting financial specialists,
controllers, and policy-makers, to way better get it Axis Bank's hazard
administration profile and make educated choices.
5. Contribute to Academic Knowledge:
The think about includes to the writing on hazard and return administration hones
inside Indian banks, with a center on how cutting edge managing an account teach
adjust to chance through inventive approaches,

3.3 SCOPE OF THE STUDY

1.Risk Types:
The investigate will investigate diverse sorts of dangers confronted by Axis Bank,
such as credit chance, showcase hazard, operational chance, liquidity chance, and
intrigued rate hazard, and analyze how these dangers are surveyed, measured, and
relieved.
2. Risk Management Framework:
The ponder will look at the hazard administration arrangements, systems, and
procedures actualized by Axis Bank, counting chance distinguishing proof, hazard
evaluation, hazard relief measures, and the part of innovation in overseeing dangers
viably.
3. Return Optimization:
The ponder will center on how Axis Bank oversees to adjust the risk-return trade-
off to optimize productivity and accomplish competitive returns for its shareholders
whereas keeping up budgetary soundness.
4. Regulatory Compliance:
The inquire about will consider the administrative environment and its affect on
hazard administration hones, especially in connection to compliance with Save
Bank of India (RBI) rules and universal benchmarks such as Basel standards.

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5. Performance Analysis:
The think about will evaluate the relationship between hazard administration
techniques and the budgetary execution of Axis Bank, counting key execution
markers like return on resources (ROA), return on value (ROE), and risk-adjusted
returns.
6. Technological Integration:
The scope will incorporate an examination of how Axis Bank has coordinates
innovation, such as chance administration computer program and information
analytics, to upgrade its hazard and return administration capabilities.
7. Comparative Examination:
Whereas the essential center will be on Axis Bank, the think about may incorporate
a brief comparative investigation with other driving banks in India to assess the
leading hones and common patterns in hazard and return administration.

3.4 OBJECTIVE OF THE STUDY

1. To analyze the sorts of risks confronted by Axis Bank:

Distinguish and categorize the different dangers (credit chance, advertise chance,
operational chance, liquidity hazard, and intrigued rate hazard) that influence the
bank's operations and monetary steadiness.

2. To assess the risk management techniques and systems utilized by Axis Bank:
Survey the adequacy of the bank's hazard administration approaches, forms, and
instruments in distinguishing, measuring, and relieving diverse sorts of dangers.

3. To look at the relationship between risk administration practices and the bank's
monetary performance:
Explore how Axis Bank's chance administration endeavors affect key budgetary
pointers like benefit, return on value (ROE), and return on resources (ROA).

4. To survey the part of technology in risk and return management:

Analyze how innovative instruments, such as chance administration program,
information analytics, and mechanization, are coordinates

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5. To assess Axis Bank's compliance with regulatory measures:

Look at the degree to which Axis Bank follows to administrative rules, counting
those set by the Save Bank of India (RBI) and worldwide systems such as Basel III,
in its hazard administration hones.
6. To compare Axis Bank's risk and return administration methodologies with
industry best practices:
Give a comparative examination of Axis Bank's hazard administration
methodologies relative to its competitors and the managing an account industry
benchmarks to identify potential qualities and ranges for enhancement.
7. To propose improvements for reinforcing risk-return management practices:
Based on the examination, propose proposals for improving Axis Bank's chance
administration systems to optimize the adjust between chance and return.

3.5 SAMPLING

Sampling Size: 100

Sampling unit: HDFC bank, Bangalore

3.6 RESEARCH DESIGN

TOOLS FOR DATA COLLECTION

Sources of Data Collection:
Primary data
1.Telephonic interview
2.Questionnaire basis

Secondary Data
Published and unpublished sources Websites, Research papers will be referred.

TOOLS OF DATA COLLECTION:

As the main technique of data collection] a questionnaire will be utilized to collect
the data for| this study. The principal method refers to the collecting technique
employed in the specific inquiry.

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Raw data may be used by researchers in a variety of ways, and as such, it can be
broadly divided into two categories: survey techniques and experimental data
gathering methods. A 5-point scale questionnaire including behavioral and other
questions will be used to gather the data. This information was gathered from
asample of 100 HDFC Bank employees.
Google form, newspaper, journals and previous survey.

3.7 PLAN OF ANALYSIS

The collection of data will be analysied using tables, charts, images, percentages
and averages.

3.8 LIMITATIONS OF THE STUDY

1.The analysis will be carried out within the areas of Bengaluru city only.
2.Due to time constrain
3.The study will be basis on information given by respondents.
4. The study will be conducted along with the resources available.

3.9 CHAPTER SCHEME

1.Introduction
2.Bank Profile
3.Research Methodology
4.Litrature Review
5.Data Analysis and finding
6.Summary of finding, Conclusion and Suggestions.

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CHAPTER 4

LITRATURE REVIEW
 A STUDY ON THE ANALYSIS OF RISK AND RETURN MANAGEMENT AT AXIS BANK

2.1REVIEW OF LITRATURE AND RESEARCH GAP

Hac, Le Dinh, et al. (2021) conducted a literature review on the topic of

enhancing risk management culture for sustainable growth ofAsia Commercial
Bank (ACB) in Vietnam under mixed effects of macro factors. The authors
emphasized the importance of risk management in the banking industry and its
relationship with macroeconomic variables. They employed the Beta CAPM
model and econometric analysis to examine the impact of internal and external
macro factors on market risk. The study found a positive correlation between
the Consumer Price Index (CPI) and ACB's Beta CAPM, while the Risk-free
rate (RD and lending rate showed a negative correlation. These results imply
that increased inflation and decreased Riskfree and lending rates contribute to
higher market risk. The authors provided valuable recommendations for macro
and risk management policies for banks and relevant government agencies,
suggesting their findings can be useful in other emerging markets.
Arora and Kaur (2020) address the important issue of credit risk assessment
and its impact on decision making for lenders. They highlight the effectiveness
of modern data mining and machine learning techniques in improving
predictive capability and decision making accuracy in credit risk assessment.
Specifically, they introduce the Bolasso (Bootstrap-Lasso) feature selection
method, which selects consistent and relevant features from a pool of
attributes. The authors apply Bolasso to the Random Forest (RF) classification
algorithm, resulting in the Bolasso enabled Random Forest (BS-RF) algorithm.
Through experiments on various datasets, including Lending Club's peer to
peer dataset and the German credit dataset, they demonstrate that BS-RF
outperforms other feature selection methods and stand-alone classifiers in
terms of stability, classification accuracy, and performance metrics like AUC
and Accuracy. This research offers valuable insights into improving the
decision-making process for lenders in credit risk assessment.
Dicuonzo, G, Galeone, G, Zappimbulso, E., & Dell'Atti, V. (2019). Risk
management 5.0: The role of Big Data Analytics in the bank sector. In this
paper, the authors highlight the transformative impact of Big Data Analytics
(BDA) on traditional approaches to risk management in the banking sector

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. They emphasize the need to query large volumes of heterogeneous data from
various sources, both internal and external, and how it contributes to value
creation and strategic decision-making. By adopting sophisticated algorithms,
organizations can intercept and interpret digital flows, particularly those from
the Internet of Things and the web. The authors argue that having access to a
large volume and wide variety. of information, known as Big Data, is crucial
for interactive and multidirectional risk assessment and management
processes. They discuss how this approach enhances the efficiency and
effectiveness of services, reduces unexpected events and losses, and improves
decision-making. The paper also explores the challenges faced by small banks
in adopting BDA techniques and the skills required for risk managers in the
digital age. The study contributes to the ongoing discussion on the use of
digital innovations, such as BDA, in the banking sector and presents future
perspectives on risk management 5.0.
Umar, Ji, Mirza, and Naqvi (2021) examine the impact of carbon-neutral
lending on credit risk within the Eurozone. Using quarterly data from 2011 to
2020 and a sample of 344 lending institutions across 19 member states, the
authors find that exposure to carbon-neutral lending is associated with a
decrease in default risk. This relationship holds true across different sizes of
banks, indicating that the effect of green financing on credit risk remains
consistent regardless of bank size. The authors attribute this reduction in credit
risk to the lower volatility of earnings and cash flows among borrowers with
sustainable business models. As a result, financial institutions can benefit from
lower loan loss provisions and economic capital requirements. This incentive
is crucial for promoting carbon-neutral credit and contributing to pro-
environmental goals. This research highlights the importance of developing a
green financial intermediation channel to foster zero-carbon economies.
Al Rahahleh, Bhatti, and Misman (2019) conducted a comprehensive review of
recent literature on risk management in Islamic banking and finance. They
compared the risks faced by Islamic banks (IBS) with conventional banks
(CBs) and assessed the effectiveness of risk mitigation strategies employed by
IBS. The study found limited support for Shariah-based product development
in IBS due to a lack of expertise in risk mitigation. IBS were found to be more
risk-sensitive compared to CBs, attributed to factors such as product nature,
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contract structure, legal costing, governance practices, and liquidity

infrastructure. The research also examined the determinants of credit risk in
Islamic banks in Malaysia, highlighting the negative impact of bank capital
and financing expansion on credit risk in IBS. This review provides valuable
insights into the evolving landscape of risk management in Islamic finance.
Ekinci and Poyraz (2019) conducted a study to analyze the impact of credit risk
on the financial performance of deposit banks in Turkey. The dataset comprised
26 commercial banks operating between 2005 and 2017, with secondary data
collected from the statistical report of the Banks Association of Turkey The
study divided the data into three panels based on ownership structure: state-
owned banks, privately-owned banks, and foreign banks. Return on Asset
(ROA) and Return on Equity (ROE) were used as indicators of financial
performance, while Non-Performing Loans (NPLs) served as a credit risk
indicator. The results indicated a negative relationship between credit risk and
both ROA and ROE, suggesting that effective credit risk management is
crucial for the profitability of Turkish deposit banks. The study highlights the
importance of focusing on credit risk management, particularly in the control
and monitoring of non-performing loans, and encourages the adoption of
modern credit risk management techniques.
Leo, M., Sharma, S., & Maddulety, K. (2019) conducted a literature review on
machine learning in banking risk management. The authors analyzed and
evaluated the application of machine learning techniques in the detection,
measurement, reporting, and management of risks in banks. They highlighted
the increasing influence of machine learning in business applications and the
importance of risk management in the banking sector, especially postglobal
financial crisis. The review revealed that while there have been studies
exploring machine learning in banking risk management, there is still a gap
between industry focus and research. The authors suggest that further research
is needed to explore untapped areas in bank risk management that could benefit
from machine learning applications. This literature review provides valuable
insights and sets the foundation for future research in this field
Pambekti, GT. (2019) conducted a comparative study on credit risk
management in Islamic and conventional banking. The author focused on the
issue of non-performing loans in conventional banks and non-performing
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financing in Islamic banks. The study aimed to determine the differences

between these two types of banks in terms of their ability to manage credit and
financing problems. The researcher employed hypothesis testing techniques,
such as independent sample t-tests and the Mann Whitney test, to analyze the
data and compare the non-performing loans and non-performing financing in
PT. Bank Mandiri and PT Bank Syariah Mandiri. The results indicated that
there are indeed differences between these two banks in managing loans and
financing issues. This study contributes to the understanding of credit risk
management in both conventional and Islamic banking sectors.
Orichom and Omeke (2021) conducted a study that examines the relationship
between capital structure, credit risk management, and financial performance
of microfinance institutions (MFIs) in Uganda. Using a cross-sectional
research design, the study analyzed data from 64 MFIs. Through correlation
and multiple regression analysis, the findings indicate that credit risk
management significantly contributes to sound financial performance.
However, the study reveals that capital structure is not significantly related to
financial performance. Therefore, the paper emphasizes the importance of
credit risk appraisal, monitoring, and mitigation in achieving positive
financial outcomes for MFIs. It suggests that managers should focus on
implementing risk preventive and control mechanisms to mitigate credit risks
and achieve favorable financial performance.
Saleh, Afifa, and Murray (2020) conducted a study to examine the effect of
credit risk, liquidity risk, and bank capital on bank profitability in an emerging
market over a nine-year period (2010-2018). Using econometric panel data
analysis and GMM methods, the study found that credit risk, liquidity risk, and
bank capital variables significantly influence bank profitability. The findings
emphasize the importance of understanding and implementing Basel
requirements, as doing so can enhance bank efficiency, increase profitability,
and mitigate risks. This research provides valuable insights for both local and
foreign bank managers in improving their understanding of risk management
practices and their impact on bank profitability.
Barjaktarovié, Vesié, and Laki (2022) focuses on analyzing the impact of
various parameters on the performance of the banking system, specifically
non-performing loans (NPLs), in the Western Balkans (WB) countries.
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The study aims to identify the most influential factors affecting the movement
of NPLs and predict future trends. The authors utilize a combination of
macroeconomic indicators and banking system performance indicators to
create predictive models for NPL trends. The research covers the period from
2010 to 2019, with predictions made for the period from 2020 to 2025. The
results indicate that the unemployment rate is the most influential factor
among the observed indicators. The study provides insights that can be
valuable for state authorities in implementing appropriate measures to address
NPLs in the WB region.

RESEARCH GAP

In the context of the study on risk management in the banking sector,

specifically with reference to HDFC Bank in Bangalore, several research gaps
are evident. Firstly, there is a paucity of research exploring the implementation
and effectiveness of risk management practices in HDFC Bank within the
unique local and regional context. Secondly, limited attention has been given
to the role of emerging technologies, such as artificial intelligence and
blockchain, in reshaping risk management strategies within the banking sector.
Additionally, there is a dearth of studies focusing on the changing regulatory
landscape and its impact on risk management practices in Indian banking
institutions. Addressing these gaps is vital for gaining a comprehensive
understanding of risk management in HDFC Bank and contributing valuable
insights to the broader field of banking risk management.

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CHAPTER 5

DATA ANALYSIS AND INTERPRETATION

 A STUDY ON THE ANALYSIS OF RISK AND RETURN MANAGEMENT AT AXIS BANK

5.1.1 PREPAREDNESS OF THE NEW BASEL PROPOSAL

YES NO TOTAL

CREDIT RISK 73 27 100

MARKET RISK 66 34 100

OPERATIONAL 47 53 100
RISK

YES NO TOTAL

NET INTREST 70 30 100

MARGIN
RETURN ON 65 35 100
ASSET
RETURN ON 55 45 100
EQUITY

Analysis
• Credit Risk: Out of the 100 respondents, (73%) believe they are
prepared in terms of capital needs for the new Basel recommendations
related to credit risk. On the other hand, (27%) indicated that they are
not prepared.
• Market Risk: For market risk, 66 % respondents reported that they are
prepared for the new Basel recommendations concerning capital needs
in this risk category. Conversely, 34% respondents expressed their lack
of preparedness.

• Operational Risk: Among the respondents, (47%) stated that they

believe they are prepared in terms of capital needs for the new Basel
recommendations in the domain of operational risk. In contrast (53%)
admitted to being unprepared.

• Net Interest Margin (NIM):Out of 100 respondents, 70% of the target

NIM levels, whereas 30 percent brief of wants."

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• Return on Assets (ROA): In terms of ROA, 65% of respondents shown

palatable execution, while 35cedchallenges."
• Return on Equity (ROE): For ROE, as it were 55% detailed accomplishing
the anticipated return, whereas 45%knowledged underperformance."

Preparedness of the new Basel Proposal(Risk)

80

70

60

50

40

30

20

10

0
OPERATIONAL MARKET CREDIT

RISK RISK RISK

Preparedness of the new Basel Proposal(Return)

70

60

50

40

30

20

10

0
NET INTREST MARGIN RETURN ON ASSET RETURN ON EQUITY

YES NO

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Interpretation :

The above chart shows that majority of respondents feel prepared in terms of
capital needs for the new Basel recommendations in credit risk (73%) and
market risk (66%). However, when it comes to operational risk, a smaller
proportion of respondents (47%) expressed their preparedness. This indicates
there may be a need for increased awareness and preparedness for the new
Basel proposal, particularly in the context of operational risk. Operational risk
management is essential for banking institutions to ensure operational
efficiency, prevent losses, and maintain regulatory compliance.
Net Interest Margin (NIM):Out of 100 respondents, 70% of the target NIM levels,
whereas 30 percent brief of wants."Return on Assets (ROA): In terms of ROA, 65%
of respondents shown palatable execution, while 35cedchallenges."Return on
Equity (ROE): For ROE, as it were 55% detailed accomplishing the anticipated
return, whereas 45%knowledged underperformance."

5.1.2 GAP ANALYSIS

YES NO TOTAL

CREDIT RISK 87 13 100

MARKET RISK 71 29 100

OPERATIONAL 63 37 100
RISK

YES NO TOTAL

NET INTREST 77 23 100

MARGIN
RETURN ON 61 29 100
ASSET
RETURN ON 53 47 100
EQUITY

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Analysis:

Credit Risk: Among the respondents, 87% indicated that they believe they are
prepared in terms of capital needs for the new Basel recommendations related
to credit risk. On the other hand, 13% of the respondents expressed their lack
of preparedness.
Market Risk: For market risk, 71 % of the respondents reported that they feel
prepared for the new Basel recommendations concerning capital needs in
this risk category Conversely, 29% of the respondents indicated their
unpreparedness.
Operational Risk: Among the respondents, 63% stated that they believe
they are prepared in terms of capital needs for the new Basel
recommendations in the domain of operational risk. In contrast, 37% of the
respondents admitted to being unprepared.
Net interest margin: Among the respondents, 77% indicated that they believe
they are prepared in terms of capital needs for the new Basel recommendations
related to credit risk. On the other hand, 23% of the respondents expressed
their lack of preparedness.
Return on Asset: For market risk, 61 % of the respondents reported that they
feel prepared for the new Basel recommendations concerning capital needs
in this risk category Conversely, 39% of the respondents indicated their
unpreparedness.
Return on Equity: Among the respondents, 53% stated that they believe
they are prepared in terms of capital needs for the new Basel
recommendations in the domain of operational risk. In contrast, 47% of the
respondents admitted to being unprepared.

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RISK

90
80
70
60
50
40
30
20
10
0
CREDIT RISK MARKET RISK OPERATIONAL RISK

YES NO

RETURN

80
70
60
50
40
30
20
10
0
NET INTREST MARGIN RETURN ON ASSET RETURN ON EQUITY

YES NO

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Interpretation:

From the above chart, it can be interpreted that a significant majority of the
respondents perceive themselves as prepared in terms of capital needs for the
new Basel recommendations across all three risk categories: credit risk (87%),
market risk (71%), and operational risk (63%) and Net interest margin(70%)
return on asset (51%) Return on equity(53%)

However, it is worth noting that there is still a notable proportion of respondents

who indicated their lack of preparedness. This suggests that there may be gaps
in knowledge or readiness among these respondents, which could pose
challenges in aligning their capital needs with the requirements outlined in the
new Basel proposal.

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