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    Bank Performance Analysis

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    Surbhî Gupta
    This document analyzes the profitability and performance of a bank over multiple years through various financial ratios. It shows that in March 2016 the bank had a return on assets of -0.01, indicating losses. The equity multiplier was 17.52, meaning assets were over 17 times equity. The non-performing assets ratio was 0.19, suggesting 19% of loans were non-performing.

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    Bank Performance Analysis

    Uploaded by

    Surbhî Gupta
    31 views10 pages
    This document analyzes the profitability and performance of a bank over multiple years through various financial ratios. It shows that in March 2016 the bank had a return on assets of -0.01, indicating losses. The equity multiplier was 17.52, meaning assets were over 17 times equity. The non-performing assets ratio was 0.19, suggesting 19% of loans were non-performing.

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    This document analyzes the profitability and performance of a bank over multiple years through various financial ratios. It shows that in March 2016 the bank had a return on assets of -0.01, indicating losses. The equity multiplier was 17.52, meaning assets were over 17 times equity. The non-performing assets ratio was 0.19, suggesting 19% of loans were non-performing.

    Copyright:

    © All Rights Reserved
    Download as XLSX, PDF, TXT or read online from Scribd
    Download as xlsx, pdf, or txt
    31 views10 pages

    Bank Performance Analysis

    Uploaded by

    Surbhî Gupta
    This document analyzes the profitability and performance of a bank over multiple years through various financial ratios. It shows that in March 2016 the bank had a return on assets of -0.01, indicating losses. The equity multiplier was 17.52, meaning assets were over 17 times equity. The non-performing assets ratio was 0.19, suggesting 19% of loans were non-performing.

    Copyright:

    © All Rights Reserved
    Download as XLSX, PDF, TXT or read online from Scribd
    Download as xlsx, pdf, or txt
    of 10

    Bank Performance Analysis

    PROFITABILITY ANALYSIS
    Mar-16

    Rs in Crore
    1 Total Assets 274,473.10
    2 Earning Assets 486,811.00
    Balances with RBI 14,033.49
    Balances with Banks in Deposit Accounts 218,555.80
    Balances with Banks & money at Call & Short Notice 8,212.74
    Balances with Banks Outside India 5,958.44
    Investments + 79,189.55
    Advances + 160,860.67
    Total Earning Assets 486,810.69
    3 Interest bearing Liabilities
    Saving Deposits 52,403.60
    Term & Other Deposits 160,028.82
    Borrowings 27,183.31
    Subordinated Debt 234,000.00
    Total Interest bearing liabilities 473,615.72

    Equity Capital 1,807.27


    Reserves 13,858.55
    Total Equity 15,666.00
    5 Interest Income 23,517.29
    6 Interest Expenditure 18,135.00
    10 Non-interest operating income 2,528.00
    11 Non-interest operating Expenditure 5,025.00
    12 Provisions and Contingencies 5,782.78
    Provisions and Contingencies include provision for tax 0.00
    Profit After tax -2,897.33
    NPA 30,048.62
    Provisions for NPAs 7,348.27
    NI or PAT -2,897.00
    Total Tax Paid -830.78

    Profitability Ratios
    Return on Assets= NI/ TA -0.01

    Equity Multiplier TA/ TE 17.52

    TE/ TA 0.06

    ROE=ROA X EM -0.18
    NI/ OR -0.11
    OR/ TA 0.09

    TA/ TE 17.52

    (II - IE)/ TA 0.02


    (OI-OE)/ TA -0.01

    Provisions/TA 0.02
    ROA -0.01

    (II- IE)/E A 0.01

    EA/ TA 1.77

    (II - IE)/ TA 0.02

    NIM 0.02
    II/ EA 0.05
    IE/ Intt Bearing Liab 0.04

    Intt Bearing Liabilities/ EA 0.97

    Spread 5382.29

    Efficiency ratio= Non intt exp/ (Net Interest Income+Non intt income) 0.19

    Risk Ratios
    Liquidity Risk= Short term securities/ Deposits

    Interest Rate Risk = Interest Sensitive Assets/ Interest Sensitive Liabilities


    Credit Risk = Provisioning / Assets 0.02

    Capital Risk = Capital / Assets 0.01

    Leverage ratio= Total equity/Total assets 0.06

    Total capital ratio= (Total equity + Long-term debt + Reserve for loan
    losses)/Total assets 0.21

    Provision for loan loss ratio= PLL/ TL (provision for loan losses/total loans
    and leases) 0.04

    Loan Ratio = Net loans/ Total assets 0.59


    Loss Ratio = Net charge-offs on loans (gross charge-offs minus
    recoveries)/ Total loans and leases
    Reserve Ratio = Reserve for loan losses (reserve for loan losses last year
    minus gross charge-offs plus PLL and recoveries)/Total loans and leases
    0.05

    Nonperforming ratio= Nonperforming assets (nonaccrual loans and


    restructured loans)/Total loans and leases 0.19

    Operating efficiency (cost control)= Wages and salaries/Total expenses 0.11

    Volatile liability dependency ratio= (Total volatile liabilities - Temporary


    investments)/Net loans and leases 2.45

    Other Financial Ratios

    Tax rate = Total taxes paid/Net income before taxes 0.22


    Gap ratio = (Interest rate-sensitive assets – Interest rate-sensitive
    liabilities)/ Total assets -1.14
    alysis

    Mar-17 Mar-18 Mar-19 Mar-20

    Rs in Crore Rs in Crore Rs in Crore Rs in Crore


    247,180.94 247,972.50 250,008.37 260,726.84
    446,679.00 444,512.00 452,955.00 447,762.00
    11,499.97 11,579.00 10,292.53 3,155.22
    205,153.96 210,388.00 217,962.67 218,028.21
    11,723.07 14,966.00 20,598.97 20,905.00
    6,188.67 6,444.00 4,571.00 4,924.00
    71,654.12 68,646.00 66,932.00 79,416.00
    140,459.62 132,489.00 132,598.00 121,333.00
    446,679.40 444,511.55 452,955.48 447,762.02

    63,231.57 66,742.00 70,652.00 75,572.00


    135,074.07 137,154.00 137,307.00 133,201.00
    16,097.67 9,228.00 6,146.00 5,420.00
    239,000.00 239,000.00 239,000.00 260,000.00
    453,403.31 452,124.36 453,104.99 474,192.28

    2,454.73 4,891.00 9,142.00 16,437.00


    11,289.82 8,383.00 7,218.00 -282.00
    13,745.00 13,274.00 16,360.00 16,155.00
    19,718.60 17,915.00 17,631.00 17,406.00
    14,529.00 12,448.00 12,352.00 12,103.00
    3,373.00 3,746.00 4,206.00 3,360.00
    4,912.00 5,585.00 4,452.00 5,129.00
    7,703.96 11,883.42 11,628.61 15,399.44
    637.01 1,954.84 2,856.86 3,338.36
    -3,416.74 -6,299.49 -3,737.88 -8,527.40
    35,098.26 38,180.15 33,398.12 19,912.70
    14,149.97 17,333.78 18,647.23 11,074.20
    -3,417.00 -6,299.00 -3,738.00 -8,527.00
    35.82 -2,332.21 -2,222.66 182.92

    atios
    -0.01 -0.03 -0.01 -0.03

    17.98 18.68 15.28 16.14

    0.06 0.05 0.07 0.06

    -0.25 -0.47 -0.23 -0.53


    -0.15 -0.29 -0.17 -0.41
    0.09 0.09 0.09 0.08

    17.98 18.68 15.28 16.14

    0.02 0.02 0.02 0.02


    -0.01 -0.01 0.00 -0.01

    0.03 0.05 0.01 0.06


    -0.01 -0.03 -0.01 -0.03

    0.01 0.01 0.01 0.01

    1.81 1.79 1.81 1.72

    0.01 0.01 0.01 0.01

    0.02 0.02 0.02 0.02


    0.04 0.04 0.04 0.04
    0.03 0.03 0.03 0.03

    1.02 1.02 1.00 1.06

    5189.60 5467.00 5279.00 5303.00

    0.10 0.12 0.14 0.11


    0.03 0.05 0.05 0.06

    0.01 0.02 0.04 0.06

    0.06 0.05 0.07 0.06

    0.17 0.12 0.12 0.08

    0.05 0.09 0.02 0.13

    0.57 0.53 0.53 0.47

    0.08 0.06 0.05 0.00

    0.25 0.29 0.25 0.16

    0.11 0.10 0.10 0.12

    2.72 2.89 2.91 3.25

    Ratios

    -0.01 0.27 0.37 -0.02

    -1.27 -1.29 -1.28 -1.35


    Analys
    Return on assets tells that how much the assets are efficient in genearting income. The ROA of I
    The equity multiplier states the level of debt financed by a business. High ratio means more com
    which means the bank has to use more debt to finance its assets.
    The proprietary Ratio has been increasing for past 4 years, but there is slight decline in 2020. Th
    amount of capitalization currently used to support a business.
    ROE measures the level that the company is able generate higher profits without as much need
    that the effeicency of the bank is poor.
    This ratio states the total percentage of net profit generated from its total operations. The Highe
    negative because the company is experiencing losses since past few years.
    The asset utilization ratio indicates the capabilty of total assets to generate revenue. The higher
    The equity multiplier states the level of debt financed by a business. High ratio means more com
    which means the bank has to use more debt to finance its assets.

    Since banks basic source of earning is spread, the need to know earning power of assets to gene
    make 2% of their assets utilized.
    This ratio is indicator to show the health of the bank that how much operating profit is generate
    This ratio tells the need of bank to create total provisions of its total assets. The higher the bad a
    which can be very dangerous for bank as it is already in losses.
    Return on assets tells that how much the assets are efficient in genearting income. The ROA of I

    This ratio states the power of earning assets to create the ability of the bank to create more spre
    of the bank is very low to generate income.
    The ratio helps to see the portion of earning assets from total assets. It indicates the ability of ba
    be said to be using its assets effeciently and has a passive income generation.
    Since banks basic source of earning is spread, the need to know earning power of assets to gene
    make 2% of their assets utilized.

    Since banks basic source of earning is spread, the need to know earning power of assets to gene
    make 2% of their assets utilized.
    This ratio helps to find the total percentage of interentincome earned because of earning assets
    This ratio helps to find the total percentage of interent expence out of total interest bearing liab
    The ratio is helpful to understand the total percentage of earning asset consumed in to settle int
    simply indicates more and more burden.
    The total amount of income generated because of lending at higher rate and depositing at lowe
    the bank which can lead the bank to shut as it is the basic income for the bank.

    This ratio tells how well the overheads expenses are being take care of. The effeciency ratio und
    decreasing. The Effeciency ratio has increased from 12.07% in 2016 to 17.38% in 2020. The ratio
    increased by 5 percent points over last 5 years.

    Data not found

    Data not found


    Credit risks are used by investors to find out company's risk level and whether they should inves
    than that and hence, one can think invest in IOB.
    This ratio measures bank's financial stability by measuring it's capital and risk. The minimum cap
    minimum requirement for daily transactions to take place, in IOB it is less which indicates that th
    The Ratio has been increasing for past 4 years, but there is slight decline in 2020. This ratio is th
    capitalization currently used to support a business.
    The ratio indicates the total amount internal liability to that of its total assets and rest portion is
    not very good for the bank as it is already is great losses.

    This ratio explains the percentage of provision created of loans. The more the provisions indicat
    NPA could be higher in these years which can again lead to more losses.
    It intreprets the banks total assets financed by debt. If it is greater than 1, it indicates that a con
    to 0.6 which is considerable.

    Data not found


    This ratio gives the indication about the money which is kept aside to recover bad loans in the fu
    to Bank's positivity regarding the decreased Bad Loans.
    NPA ratio indicates out of total loans granted, how many are now non performing. NPA r
    Loans over the years.
    As a bank, it need to know the portion of money spend on its staff of total expenses as it is a ser

    This ratio gives an indication of the extent to which “hot” money is being used to fund the riskie
    Bank's vulnerability is also increasing to risk of bad loans as well as hot money is also increasing
    funds.

    It shows the percentage of tax paid by the banks. The less it is means more disposable income a
    to analyze this ratio as the amount of tax paid depends uponth profit and since it has incurred lo

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