Introduction of Topic

A savings account is an interest-bearing deposit account held at a bank or other financial institution that
provides a modest interest rate. Financial institutions that offer savings accounts may limit the number
of withdrawals from an account each month. They also may charge fees unless you maintain a certain
average monthly balance in the account.

Savings accounts generally are opened to keep money not intended for daily or regular expenses.
Savings accounts differ from checking accounts, which allow the use checks and electronic debit to
access funds. Additionally, savings accounts—unlike checking accounts—typically have limits on the
number of withdrawals or transactions you may make each month.

Because savings accounts pay interest, it is more beneficial to keep your unneeded funds in a savings
account than in a checking account so your money can grow. In addition, savings accounts are one of
the most liquid investments outside of other demand accounts and cash. While savings accounts
facilitate saving, they also make it very easy to access your funds. In contrast, it is typically more
difficult to cash a bond, make a withdrawal from a retirement account, or sell stocks or other assets.
There is new input of CASA i.e current account saving account where A current account savings
account (CASA) is aimed at combining the features of savings and checking accounts to entice
customers to keep their money in the bank by paying very low or no interest on the current account and
an above-average return on the savings portion.

They are offered free or for a fee, depending on minimum- or average-balance requirements, and are
an attempt to limit the disintermediation that occurs when bank-deposit interest is lower than other
available short-term investments. These deposits, which are considered a more dependable source of
funds for a bank, tend to be a cheaper way to raise money rather than through issuing certificates of
deposit (CDs).

A CASA operates like a normal bank account in which funds may be utilized at any time. Because of
this flexibility, a CASA has a lower interest rate than a term deposit because the bank does not have a
guarantee that all the funds are available to lend for a specific period of time. Demand deposits, such
as a CASA, let customers exchange a higher rate of interest for higher liquidity and access to funds.
The amount of money deposited into a CASA is an important metric to determine the profitability of a
bank.

Use of a CASA is only functional under the assumption that depositors will not withdraw all funds in
the very near future. Likewise, because of the uncertainty relating to when a depositor will withdraw
funds, CASA funds are not to be utilized by a bank for long-term financing.

Financial institutions encourage the use of a CASA because it generates a higher profit margin. Because
the interest paid on the CASA deposit is lower than on a term deposit, the bank’s net interest
income (NII) is higher. Thus, CASAs can be a cheaper source of funding for banks. The existence of
the CASA can be seen as a product of especially competitive or saturated markets, in which financial
services companies have to create a steady stream of new products and features that compel consumers
to differentiate among different providers. As it stands, very few people agree that any market has one
'best' bank; globally, a large share of individuals believe all banks and financial institutions are roughly
the same. The use of a CASA is mostly prevalent in certain parts of Asia. The Reserve Bank of
 India determines the interest rates paid on a CASA in India. Approximately 48% of the funds held by
the State Bank of India are deposits in CASAs. The highest ratio is found at the HDFC Bank in India,
with 52% of its deposits being held in CASAs.

Company Profile
 Establishment of company
The Housing Development Finance Corporation Limited (HDFC) was amongst the first to receive an ‘in
principle’ approval from the Reserve Bank of India (RBI) to set up a bank in the private sector, as part of
RBI’s liberalization of the Indian Banking Industry in 1994. The bank was incorporated in August 1994 in
the name of 'HDFC Bank Limited', with its registered office in Mumbai, India. HDFC Bank commenced
operations as a Scheduled Commercial Bank in January 1995.
HDFC is India’s premier housing finance company and enjoys an impeccable track record in India as well
as in international markets. Since its inception in 1977, the Corporation has maintained a consistent and
healthy growth in its operations to remain the market leader in mortgages. Its outstanding loan portfolio
covers well over a million dwelling units. HDFC has developed significant expertise in retail mortgage
loans to different market segments and also has a large corporate client base for its housing related credit
facilities. With its experience in the financial markets, strong market reputation, large shareholder base and
unique consumer franchise, HDFC was ideally positioned to promote a bank in the Indian environment.
As of June 30, 2017, the bank's distribution network was at 4,715 branches and 12,260 ATMs across 2,657
cities and towns. The bank also installed 4.30 Lakhs POS terminals and issued 235.7 Lakhs debit cards and
85.4 Lakhs credit card in FY 2017.

 Vision of the company

“To be customer driven best managed enterprise that enjoys market leadership in providing housing related
finance”

 Mission of the company

“HDFC banks mission is to be “a World Class Indian Bank”, benchmarking them against international
standards and best practices in terms of product offerings, technology, service levels, risk management and
audit & compliance”

 Objective of the company

“Is to build sound customer franchises across distinct business so as to be a preferred provider of banking
services for target retail and wholesale customer segments and to achieve a healthy growth in profitability,
consistent with the bank’s risk appetite. We are committed to do this while ensuring the highest levels of
ethical standards, professional integrity, corporate governance and regularity compliance.”