Bankingg

INDUSTRY PROFILE
INTRODUCTION TO THE INDIAN BANKING INDUSTRY

BANKING IN HISTORICAL PERSPECTIVE
The origin of banking in India can be traced back to almost the Vedic period. The
transformation from pure money lending to proper banking appears to have taken place
before the times of Manu. Manu, a great Hindu jurist, has devoted a section of his work
explaining the deposits and advances and he even laid down certain rules on rates of
interest.
Through out Mauryan period and later on desi bankers played some role in the
economy of the country. However, it was during the Moghul period that indigenous
bankers started playing a vital role in lending money and financing of the foreign trade
and commerce.
BANKING DURING BRITISH PERIOD BEFORE INDEPENDENCE:
• The first joint stock bank, namely The General Bank of India was established in
1786.
• Later on Bank of Hindustan and Bengal Bank also came into existence. Bank of
Hindustan carried on the business till 1906.
• East India Company established the following three banks, namely The Bank of
Bengal in 1809, The Bank of Bombay in 1840, and Bank of Madras in 1843. They
were collectively called Presidency Banks and were well functioning independent
units.
• The three banks established by the East India Company were amalgamated in 1920
and a new bank called Imperial Bank of India was established.
• A number of private banks had been established by the businessmen from mid of
the 19th century onwards. In the surchanged atmosphere of Swadeshi movement, a
number of banks with Indian management, namely, Punjab National Bank Ltd., Bank
of India Ltd., Canara Bank Ltd, Indian Bank Ltd. etc. were established.
• The Reserve Bank of India was established as the Central bank of the country in
1935 under an act called Reserve bank of India Act. Later on with the passage of
the Banking Regulation Act passed in 1949, RBI was brought under government
control. Under this Act, RBI was conferred with supervision and control of the
banks and licensing powers and the authority to conduct inspections was also given
to it.
AFTER INDEPENDENCE :
• In 1955, the Imperial Bank of India was nationalised and was given the name "State
Bank of India". It was established under State Bank of India Act, 1955.
• In 1960, RBI was empowered to force the compulsory merger of the weak banks
with the strong ones. This led to reduction in the number of banks from 566 in 1951
to about 89 in 1969.
• On July 19, 1969, 14 major banks were nationalised.
• In 1980, another six banks were nationalized, and thus raising the number of
nationalized banks to 20.
• On the suggestions of Narsimham Committee, the Banking Regulation Act was
amended in 1993 and thus the gates for the new private sector banks were opened.
PRESENT STRUCTURE OF INDIAN BANKING SYSTEM
Banks in India can be categorized into non-scheduled banks and scheduled banks.
Scheduled banks constitute of commercial banks and co-operative banks. There are
about 67,000 branches of Scheduled banks spread across India. During the first phase
of financial reforms, there was a nationalization of 14 major banks in 1969. This crucial
step led to a shift from Class banking to Mass banking. Since then, the growth of the
banking industry in India has been a continuous process.
The Public Sector Banks (PSBs), which are the foundation of the Indian Banking system
account for more than 78 per cent of the total banking industry assets. Unfortunately,
they are burdened with excessive Non-Performing Assets (NPAs), massive manpower
and lack of modern technology.
On the other hand, the Private Sector Banks in India are witnessing immense progress.
They are leaders in Internet Banking mobile banking, phone banking, ATMs etc.
STRUCTURE OF THE INDIAN BANKING INDUSTRY
 Public sector (Government owned) banks account for 75% of the assets; however.
Indian private banks and foreign banks are growing rapidly and gaining a larger
share.
 Standard Charted Bank, Citibank and HSBC are the three largest foreign banks in
India with more than 65% of the total assets of foreign banks.
Reserve Bank of India

The Reserve Bank of India was established on April 1, 1935 in accordance with the
provisions of the Reserve Bank Of India Act, 1934.
The Central Office of the Reserve Bank was initially established in Calcutta but was
permanently moved to Mumbai in 1937. The Central Office is where the Governor sits
and where policies are formulated.
Though originally privately owned, since nationalisation in 1949, the Reserve Bank is
fully owned by the Government of India.
Preamble
The Preamble of the Reserve Bank of India describes the basic functions of the
Reserve Bank as:
"...to regulate the issue of Bank Notes and keeping of reserves with a view to
securing monetary stability in India and generally to operate the currency and
credit system of the country to its advantage."
Organisation & Functions
Reserve Bank of India (RBI) is the Central Bank and all Banks in India are required to
follow the guidelines issued by RBI.
Financial Supervision
The Reserve Bank of India performs this function under the guidance of the Board for
Financial Supervision (BFS). The Board was constituted in November 1994 as a
committee of the Central Board of Directors of the Reserve Bank of India.
Objective
Primary objective of BFS is to undertake consolidated supervision of the financial sector
comprising commercial banks, financial institutions and non-banking finance
companies.
Constitution
The Board is constituted by co-opting four Directors from the Central Board as members
for a term of two years and is chaired by the Governor. The Deputy Governors of the
Reserve Bank are ex-officio members. One Deputy Governor, usually, the Deputy
Governor in charge of banking regulation and supervision, is nominated as the Vice-
Chairman of the Board.
BFS meetings
The Board is required to meet normally once every month. It considers inspection
reports and other supervisory issues placed before it by the supervisory departments.
BFS through the Audit Sub-Committee also aims at upgrading the quality of the
statutory audit and internal audit functions in banks and financial institutions. The audit
sub-committee includes Deputy Governor as the chairman and two Directors of the
Central Board as members.
The BFS oversees the functioning of Department of Banking Supervision (DBS),
Department of Non-Banking Supervision (DNBS) and Financial Institutions Division
(FID) and gives directions on the regulatory and supervisory issues.
Functions
Some of the initiatives taken by BFS include:
i. restructuring of the system of bank inspections
ii. introduction of off-site surveillance,
iii. strengthening of the role of statutory auditors and
iv. strengthening of the internal defences of supervised institutions.
The Audit Sub-committee of BFS has reviewed the current system of concurrent audit,
norms of empanelment and appointment of statutory auditors, the quality and coverage
of statutory audit reports, and the important issue of greater transparency and
disclosure in the published accounts of supervised institutions.
Current Focus
• supervision of financial institutions
• consolidated accounting
• legal issues in bank frauds
• divergence in assessments of non-performing assets and
• supervisory rating model for banks.
Main Functions
Monetary Authority:
• Formulates, implements and monitors the monetary policy.
• Objective: maintaining price stability and ensuring adequate flow of credit to
productive sectors.
Regulator and supervisor of the financial system:

• Prescribes broad parameters of banking operations within which the country's
banking and financial system functions.
• Objective: maintain public confidence in the system, protect depositors' interest
and provide cost-effective banking services to the public.
Manager of Foreign Exchange

• Manages the Foreign Exchange Management Act, 1999.
• Objective: to facilitate external trade and payment and promote orderly
development and maintenance of foreign exchange market in India.
Issuer of currency:
• Issues and exchanges or destroys currency and coins not fit for circulation.
• Objective: to give the public adequate quantity of supplies of currency notes and
coins and in good quality.
Developmental role
• Performs a wide range of promotional functions to support national objectives.
Related Functions
• Banker to the Government: performs merchant banking function for the central
and the state governments; also acts as their banker.
• Banker to banks: maintains banking accounts of all scheduled banks.
GROWTH OF BANKING INDUSTRY

Growth of HDFC Bank, ICICI Bank, AXIS Bank, Bank of India, Punjab National Bank,
State Bank of India with respect to income generated.
HDFC Bank:
HDFC Bank was incorporated in August 1994, and, currently has an nationwide
network of 1,725 branches and 4,393 ATM’s in 780 Indian towns and cities.
Interpretation: From the above diagram it can be interpreted that HDFC Bank is
continuously growing well from the last five years, or we can say that in 2010 the
income of the bank is 5times as compared to 2006.
ICICI Bank
ICICI Bank is India's second-largest bank with total assets of Rs. 3,634.00 billion (US$
81 billion) at March 31, 2010 and profit after tax Rs. 40.25 billion (US$ 896 million) for
the year ended March 31, 2010. The Bank has a network of 2,035 branches and about
5,518 ATMs in India and presence in 18 countries
Interpretation: From the above diagram it can be interpreted that ICICI Bank have
grown well till 2009 but the income of bank decreases from mar-2009 to mar-2010.
BANK OF INDIA:
Bank of India was founded on 7th September, 1906 by a group of eminent businessmen
from Mumbai. The Bank was under private ownership and control till July 1969 when it
was nationalised along with 13 other banks. The Bank has 3101 branches in India
spread over all states/ union territories including 141 specialised branches. The
international business accounts for around 17.82% of Bank's total business.
Interpretation: From the above diagram it can be interpreted that BOI is continuously
growing well from the last five years.
PUNJAB NATIONAL BANK
The bank was incorporated under Act VI of the 1882 Indian Companies Act on 19
May, 1894.
Interpretation: From the above diagram it can be interpreted that PNB Bank is
continuously growing well from the last five years, or we can say that in 2010 the
income of the bank is twice as compared to 2006.
STATE BANK OF INDIA:

The origin of the State Bank of India goes back to the first decade of the nineteenth
century with the establishment of the Bank of Calcutta in Calcutta on 2 June 1806.
Interpretation: From the above diagram it can be interpreted that SBI Bank is
continuously growing well from the last five years.
AXIS Bank
Axis Bank was the first of the new private banks to have begun operations in 1994, after
the Government of India allowed new private banks to be established. The Bank was
promoted jointly by the Administrator of the specified undertaking of the Unit Trust of
India (UTI - I), Life Insurance Corporation of India (LIC) and General Insurance
Corporation of India (GIC) and other four PSU insurance companies, i.e. National
Insurance Company Ltd., The New India Assurance Company Ltd., The Oriental
Insurance Company Ltd. and United India Insurance Company Ltd.
CURRENT RATES AND RATIOS:

Bank rate 6.0%
Repo rate 5.75%
Reverse repo rate 4.50%
CRR 6.0%
SLR 25.0%
Base rate 7.50%-8.00%
Saving bank rate 3.5%
Deposit rate 6.00%-7.50%
Source: rbi
LATEST TREND IN BANKING SECTOR

(A) Implementation of Basel II :
• Credit Risk : Rating of the loan portfolio
• Market Risk
• Operational risk
(B) Retail Banking : The main focus area of the bankers in India had always been the
corporate sector. The retail loans to individuals like personal loan, vehicle loans,
housing loan were discouraged. A middle class person hardly ever ventured to take a
loan from Bank for his personal needs. Bank was looked as a lender to the business
houses. However, the latest trend in banking sector in India is the focus on retail loans.
We have in recent months have witnessed the unprecedented competition among the
banks to have a large pie in housing loan segment.
Technology in Banks:
ATM’s: Automated Teller Machine: The first bank to introduce the ATM concept in
India was the Hongkong and Shanghai Banking Corporation (HSBC). It was in the year
1987.The first bank to cross 1,000 marks in installing ATMs in India is ICICI. Private
Sector Banks have taken the lead. ICICI, UTI, HDFC and IDBI counts more than 50% of
the total ATMs in India. Public Sector Banks are also taking the installation of ATMs
seriously for Indian market. They are either setting up their own ATM centres or entering
into tie-ups with other banks. The Corporation Bank has the second largest network of
ATMs amongst the Public Sector Banks in India. The Indian banks have also come up
with a 'Swadhan' scheme. Under this scheme, the banks can use each other's ATM
Mobile Banking: Mobile Banking refers to provision and availment of banking- and
financial services with the help of mobile telecommunication devices.The scope of
offered services may include facilities to conduct bank and stock market transactions, to
administer accounts and to access customised information.
With mobile banking facilities, one can bank from anywhere, at anytime and in any
condition or anyhow. The system is either through SMS or through WAP. Mobile
Banking is the hottest area of development in the banking sector and is expected to
replace the credit/debit card system in future. In past two years, mobile banking users
have increased three times if we compare the use of either debit card or credit card. It is
extremely easy and inexpensive to implement. It reduces the cost of operation for
bankers in comparison to the use of ATMs. Using compact HTML and WAP
technologies, the following operations can be conducted through advanced mobile
phones which can is further viewed on channels such as the Internet via the Channel
Manager.
• Bill payments
• Fund transfers
• Check balances
• Any many more which is also available in SMS Banking
SMS Banking: This is a technology-enabled service offering from banks to its
customers, permitting them to operate selected banking services over theirmobile
phones using SMS messaging.With the use of this technology the following operations
can be easily performed by the user by just sending an sms.
• Balance enquiry
• Last three transactions
• Cheque payment status
• Cheque book request
• Statement request
• Demat - Free Balance Holding
• Demat - Last two Transactions
• Bill Payment
Online Banking: Online banking (or Internet banking) allows customers to conduct
financial transactions on a secure website operated by their retail or virtual bank, credit
union or building society.
Tele Banking: Telephone banking is a service provided by a financial institution, which

allows its customers to perform transactions over the telephone.
FINANCIAL ANALYSIS OF BANKS
To conduct the financial analysis financial statements are needed. From financial
statements data is collected to calculate the ratios. Financial Statements : There are
four basic financial statements that provide information needed by financial analysts to
evaluate a company. These are :-:
• The Balance Sheet
• The Income Statement / Profit and Loss Account
• The Funds Flow statement
• The Cash Flows Statement
Moreover, a company's annual report is almost always accompanied by "Notes to the
financial statement".
What is Analysis of Financial Statements :
Analysis of financial statements is a study of relationships among the various financial
factors in a business. Through analysis an attempt is made to determine the meaning
and significance of financial statement data so that the forecast can be made in respect
of future earnings, profitability etc. However, the results arrived on the basis of
analysis of such statements has its own limitations.
ADVANTAGES OF FINANCIAL ANALYSIS :
(a) To know the earning capacity of the entity : Financial analysis helps in
ascertaining whether sufficient profits are being earned on the capital invested in the
business or not. Moreover, it also helps us to know whether the profit is increasing or
decreasing.
(b) To know the solvency of the entity : Analysis of the financial statements
discloses whether the business is in a position to pay its short-term and long term
liabilities in time.
(c) To know the financial strength : It also discloses the total position of the business
regarding its goodwill, internal finance system etc.
(d) Comparative study with other firms : The comparative study of the profitability of
various firms engaged in the same industry can be done to study the position of the firm
in respect of sales, profitability etc
(e) Capability to pay interest and dividend: The analysis also helps to assess
whether the entity will have sufficient profits to pay the interest in time and whether it
has the capacity to pay the dividend in future at a higher ratio.
LIMITATIONS OF FINANCIAL ANALYSIS :-

(1) Limitations of financial statements:-Financial statements have their own
limitations and thus the analysis done on the basis of such statements will also suffer
from inadequacies. Moreover, the financial statements record only those events that
can be expressed in terms of money. Qualitative aspect like cordial management-labour
relations, efficiency of management and more which may have a vital bearing on the
firm's profitability are ignored.
(2) Affected by window dressing: Most of the firm resort to window dressing and try
to cover their weak points so that they do not face problems with their bankers and
shareholders etc. It is common practice by firms to overvalue their closing stock and
hence the result obtained based on such analysis are misleading.
(3) Different accounting policies: Firms adopting different accounting policies may not
have the result which may be comparable. For example, the method of valuing closing
stock of two firms may differ and thus the comparison of such results will be wrong.
Techniques of Financial Statement Analysis: These are broadly classified into three
categories, namely:-
i) Cross Sectional Analysis or Inter firm comparison.
ii) Time series Analysis or Intra comparison.
iii) Cross Sectional-cum-time series analysis.
Cross Sectional Analysis : Under this technique of analysis, financial statements of

one firm are compared with financial statements of one or more other similar firms for
profitability, solvency, liquidity, credit worthiness etc Thus, under this technqiue we
prepares the comparative financial characteristics of an enterprise with other
comparable enterprises.
Time Series Analysis : This reflects the movement of various financial characteristics
over a period. Under this technqiue, the financial characteristics of a firm are compared
over a number of years so as to know the directions in which the firm is moving.
Cross Sectional-cum-Time Series Analysis: This is the most effective approach of

financial statement analysis and compares the financial characteristics of two or more
enterprises for a defined accounting period.
CAMEL MODEL
In 1994, the RBI established the Board of Financial Supervision (BFS), which operates
as a unit of the RBI. The entire supervisory mechanism was realigned to suit the
changing needs of a strong and stable financial system. The supervisory jurisdiction of
the BFS was slowly extended to the entire financial system barring the capital market
institutions and the insurance sector. Its mandate is to strengthen supervision of the
financial system by integrating oversight of the activities of financial services firms. The
BFS has also established a sub-committee to routinely examine auditing practices,
quality, and coverage.
In addition to the normal on-site inspections, Reserve Bank of India also conducts off-
site surveillance which particularly focuses on the risk profile of the supervised entity.
The Off-site Monitoring and Surveillance System (OSMOS) was introduced in 1995
as an additional tool for supervision of commercial banks. It was introduced with the aim
to supplement the on-site inspections. Under off-site system, 12 returns (called DSB
returns) are called from the financial institutions, wich focus on supervisory concerns
such as capital adequacy, asset quality, large credits and concentrations, connected
lending, earnings and risk exposures (viz. currency, liquidity and interest rate risks).
In 1995, RBI had set up a working group under the chairmanship of Shri S.
Padmanabhan to review the banking supervision system. The Committee certain
recommendations and based on such suggetions a rating system for domestic and
foreign banks based on the international CAMELS model combining financial
management and systems and control elements was introduced for the inspection cycle
commencing from July 1998. It recommended that the banks should be rated on a five
point scale (A to E) based on th elines of international CAMELS rating model. CAMELS
evaluates banks on the following six parameters :-
(a) Capital Adequacy
(b) Asset Quality
(c) Management
(d) Earning
(e) Liquidity
CAPITAL ADEQUACY
Capital Adequacy is a measure of an FI's (such as banks) financial strength, in
particular its ability to cushion operational and abnormal losses. An FI should have
adequate capital to support its risk assets in accordance with the risk-weighted capital
ratio framework. It has become recognized that capital adequacy more appropriately
relates to asset structure than to the volume of liabilities.
TOTAL CAR BASEL I (%)& TOTAL CAR BASEL II (%)
The Basel II framework is highly complex on account of the several factors such as: (i)
variety of available options; (ii) diversity in exercise of national discretions and their
likely impact; (iii) lack of clarity on regulatory approach to various implementation
issues, especially in a cross border situation; and (iv) likely unintended scope for
regulatory arbitrage.
Under the Basel II framework, in addition to maintaining capital for credit and market
risks, banks are required to maintain capital for operational risk also.
ASSET QUALITY
Asset quality has direct impact on the financial performance of BANKs. Asset quality is
related to the left-hand side of the bank balance sheet.Bank managers are concerned
with the quality of their loans since that provides earnings for the bank. The quality of
assets particularly, loan assets and investments, would depend largely on the risk
management system of the institution. The value of loan assets would depend on the
realizable value of the collateral while investment assets would depend on the market
value.
MANAGEMENT QUALITY
The performance of the other four CAMEL components will depend on the vision,
capability, ability, professionalism, integrity, and competence of the BANK’s
management. As sound management is crucial for the success of any institution,
management quality is generally accorded greater weighting in the assessment of the
overall CAMEL composite rating.
ASSESSING EARNING PERFORMANCE
The quality and trend of earnings of an institution depend largely on how well the
management manages the assets and liabilities of the institution. An FI must earn
reasonable profit to support asset growth, build up adequate reserves and enhance
shareholders' value. Good earnings performance would inspire the confidence of
depositors, investors, creditors, and the public at large.
RETURN ON ASSETS
Return on Assets (ROA) is an indicator informing the user about how profitable a
company is relative to its total assets. It tells the user how effective a business has been
putting its assets to work. In other words, the ROA is a test of capital utilization, that is
how much profit (before interest and income tax) a business earned on the total capital
used to make that profit.
RETURN ON EQUITY
ROE indicates how well the firm has used the resources of owners. The main objective
of any business is earning a satisfactory return. This ratio reflects the extent to which
this objective has been accomplished.
LIQUIDITY RATIO
Liquidity ratio measure the ability of a firm to meet its current obligations. A firm should
ensure that it does not suffer from lack of liquidity, and also that it does not have excess
liquidity. The failure of a company to meet its obligations due to lack of sufficient
liquidity, will result in poor credit worthiness, loss of creditor’s confidence, or even in
legal tangles resulting in closure of the company. A very high degree of liquidity is also
bad; idle assets earn nothing. The firm’s funds will be unnecessarily tied up in current
assets. Therefore, it is necessary to strike a proper balance between high liquidity and
lack of liquidity. As liquidity has inverse relationship with profitability, an FI must strike a
balance between liquidity and profitability. An FI must always be liquid to meet
depositors' and creditors' demand to maintain public confidence. There needs to be an
effective asset and liability management system to minimize maturity mismatches
between assets and liabilities and to optimize returns.
Rating
Rating symbol indicates
Symbol
A Bank is sound in every respect
B Bank is fundamentally sound but with moderate weaknesses
financial, operational or compliance weaknesses that give cause for

C
supervisory concern.
serious or immoderate finance, operational and managerial

D
weaknesses that could impair future viability
critical financial weaknesses and there is high possibililty of failure in

E
the near future.
INTERPRETATION
HDFC BANK
CAPITAL ADEQUACY
TOTAL CAR BASEL I (%)&TOTAL CAR BASEL II (%)
Interpretation :-This ratio basically determine the how well banks can cope up with
the risks or we can say that to the shocks to their balance sheets. It is a measure of how
much capital is used to support the banks' risk assets. So this ratio determines the
capacity of a bank in terms of meeting with the liability and other risks such as credit
risk, operational risk. So capital provides cushion for potential losses.
ASSET QUALITY
NET NPAs (FUNDED) TO NET ADVANCES (%)
INTERPRETATION :- This ratio represents the assets which are not performing good,
and we can see that HDFC having trend of NPAs less than 0.5% from 2006-2010. It is a
indicator that HDFC is a performing well.
MANAGEMENT QUALITY
COST PER UNIT OF MONEY LENT (%)
INTERPRETATION :- This ratio indicates to what extent a bank is competent in

managing it. In addition performance evaluation includes compliance with set norms,
ability to plan and react to changing circumstances, technical competence, leadership
and administrative ability. As this cost is decreasing year by year, which is a good
indicator.
EARNING RATIO
ROA (%) & ROE (%)
INTERPRETATION :- This ratio represents return on assets and equity employed by

the banks. And HDFC having a stable trend in both the ratios which is a indicator that it
does not face much fluctuations.
INTEREST SPREAD RATIO (%) & EARNING SPREAD RATIO (%)
INTERPRETATION :-This ratio represents the interest and earning distributed by the
banks. Earning spread ratio shows a steady trend but interest spread ratio has
increased in 2008 after that it keeps on decreasing.
INTERMEDIATION COST RATIO (%)
INTERPRETATION :- INTERMEDIATION COST, in finance, is the cost involved in the

placement of money with a financial intermediary. The person or institution empowered
as the intermediary to make investment decisions for others. Examples: banks, savings
and loan institutions, insurance companies, brokerage firms, mutual funds, and credit
unions. And the above diagram depicts that this cost is decreasing from the last three
years. Which is again a good indicator.
LIQUIDITY RATIO
CREDIT/DEPOSITS (%)
INTERPRETATION :- Credit to deposit ratio represents to how much extent a bank is

using its deposits (investments of people with the bank). Upto 75% is best. Because
they have to deposit upto 25% with RBI to meet emergencies. This rate is increasing
year after year, which means HDFC is performing well. But in 2010 this rate is beyond
75%, which means they are borrowing some funds from outside.
INTEREST EXPENDED / INTEREST EARNED (%)
INTERPRETATION :-
This ratio represents the expenses over the earnings. The above diagram shows that it
is having less than 50% expenses except 2009. It means earnings are more than the
expenses.
INTEREST INCOME / TOTAL FUNDS (%)
INTEREST EXPENDED / TOTAL FUNDS (%)
NIM (%)
INTERPRETATION :-
This ratio represents the income and expenses over total funds. And NIM is difference
between expenses and income. As digram depicts that income is more than the
expenses. Which is again represents that HDFC is a good performing bank.
ICICI BANK
CAPITAL ADEQUACY
TOTAL CAR BASEL 1 (%)&TOTAL CAR BASEL II (%)
INTERPRETATION :-This ratio basically determine the how well banks can cope up
with the risks or we can say that to the shocks to their balance sheets. It is a measure of
how much capital is used to support the banks' risk assets. So this ratio determines the
ASSET QUALITY
and we can see that ICICI BANK having trend of NPAs less than 2% from 2006-2010.
MANAGEMENT QUALITY

and administrative ability. As this cost is decreasing after 2008, which is a good
indicator.
EARNING RATIO
ROA (%) & ROE (%)

the banks. And ICICI BANK is facing fluctuations in both the ratios.
INTEREST SPREAD RATIO (%) &EARNING SPREAD RATIO (%)
INTERPRETATION :- This ratio represents the interest and earning distributed by the
banks. Earning spread ratio and interest spread ratio shows an increasing trend.

unions. And the above diagram depicts that this cost is increasing year by year. Which
is again a not a good indicator.
LIQUIDITY RATIO
CREDIT/DEPOSITS (%)

year after year, which means ICICI BANK is performing well. But this rate is beyond
INTERPRETATION :- This ratio represents the expenses over the earnings. The above
diagram shows that it is having more than 50% expenses in all the years. It means
expenses are more than the earnings.
NIM (%)
INTERPRETATION :-
This ratio represents the income and expenses over total funds. And NIM is difference
between expenses and income. As digram depicts that income is more than the
expenses. Which represents that ICICI BANKis a good performing bank.
AXIS BANK
CAPITAL ADEQUACY
INTERPRETATION :- This ratio basically determine the how well banks can cope up
ASSET QUALITY
and we can see that AXIS BANK having trend of NPAs less than 0.5% from 2008-2010.
It is a indicator that AXIS BANK is a performing well.
MANAGEMENT QUALITY
INTERPRETATION :-
This ratio indicates to what extent a bank is competent in managing it. In addition
performance evaluation includes compliance with set norms, ability to plan and react to
changing circumstances, technical competence, leadership and administrative ability.
As this cost is decreasing after 2008, which is a good indicator.
EARNING RATIO
ROA (%)&ROE (%)

the banks. And AXIS BANK having a increasing trend in ROA which means its
improving year after year and face fluctuations in ROE.
INTEREST SPREAD RATIO (%) &EARNING SPREAD RATIO (%)
banks. Earning spread ratio and interest spread ratio, both are fluctuating from 2006-
2010

unions. And the above diagram depicts that this cost is increasing year after year.
Which is not a good indicator.
LIQUIDITY RATIO
CREDIT/DEPOSITS (%)

year after year, which means AXIS BANK is performing well, and in 2010 it reach upto
approx 74%, which means AXIS BANK is improving its performance year by year.

diagram shows that it is having more than 50% expenses except 2009. It means
expenses are more than the earnings.
NIM (%)
INTERPRETATION :- This ratio represents the income and expenses over total funds.
And NIM is difference between expenses and income. As digram depicts that income is
more than the expenses. Which is again represents that AXIS BANK is a good
performing bank.
BOI
CAPITAL ADEQUACY
ASSET QUALITY
NET NPAs (FUNDED) TO NET ADVANCES(%)
and we can see that BOI face fluctuations of NPAs from 2006-2010.
MANAGEMENT QUALITY

indicator.
EARNING RATIO
ROA (%)&ROE (%)

the banks. And BOI face fluctuations in both the ratios.
INTEREST SPREAD RATIO (%)&EARNING SPREAD RATIO (%)
banks. Earning spread ratio decreasing year by year and interest spread ratio is
decreasing till 2008 after that it has increased and again decrease which means it face
fluctuations.

unions. And the above diagram depicts that this cost is decreasing year by year. Which
is again a good indicator.
LIQUIDITY RATIO
CREDIT/DEPOSITS (%)

year after year, which means BOI is performing well. But in 2008 AND 2009 this rate is
beyond 75%, which means they are borrowing some funds from outside.

diagram shows that it is having more than 50% . It means expenses are more than the
earnings, which is not a good indicator.
NIM (%)
more than the expenses. Which is again represents that BOI is a good performing bank.
PNB
CAPITAL ADEQUACY
ASSET QUALITY
and we can see that PNB having trend of NPAs approx less than 1% and keeps on
fluctuating from 2006-2010. It is a indicator that PNB is a performing well.
MANAGEMENT QUALITY

indicator.
EARNING RATIO
ROA (%)&ROE (%)

the banks. And BOI having a increasing trend in both the ratios, which is a good
indicator.

banks. Earning spread ratio shows and interest spread ratio are fluctuating year after
year.

unions. And the above diagram depicts that this cost is decreasing year by year. Which
is again a good indicator.
LIQUIDITY RATIO
CREDIT/DEPOSITS (%)

year after year, which means PNB is performing well. But in 2010 this rate is beyond
expenses are more than the earnings, which is not a good indicator.
NIM (%)
more than the expenses. Which represents that PNB is a good performing bank.
SBI
CAPITAL ADEQUACY
ASSET QUALITY
and we can see that NPAs decreasing year by year. It is a indicator that SBI is a
performing well.
MANAGEMENT QUALITY

indicator.
EARNING RATIO
ROA (%)&ROE (%)

the banks. And SBI face fluctuations in both the ratios.
banks. Earning spread ratio face fluctuations but interest spread ratio keeps on
decreasing year after year.

unions. And the above diagram depicts that this cost is decreasing till 2008 after that it
starts increasing.
LIQUIDITY RATIO
CREDIT/DEPOSITS (%)

year after year, which means SBI is performing well. But in 2007, 2008 and in 2010 this
rate is beyond 75%, which means they are borrowing some funds from outside.
expenses are more than the earnings, which is not a good indicator.
NIM (%)
more than the expenses. Which is again represents that SBI is a good performing
bank.
RESEARCH & COMPARATIVE ANALYSIS

NEED AND OBJECTIVE OF THE STUDY
AN investor who would like to be rational and scientific in his investment activity has to
evaluate a lot of information about past performance and the expected future
performance of the companies, industries and the economy as a whole before taking
the investment decision and hence, the present study attempts to analyze the position
of the sample companies.
Some of the objectives of conducting the study are as follows:
➢ To take investment decision cautiously after studying risks involved in the same.
➢ To gain knowledge of evaluating intrinsic value of a firm.
➢ To acquire practical exposure of financial analysis of an enterprise.
➢ To get familiarity of scheming comparative efficiency of different firms.
➢ To analyze the profitability position of sample banks.
HYPOTHESIS
The study tests whether the selected variables of sample companies vary significantly
during the study period. This specific hypothesis is tested at appropriate time while
analyzing and interpreting the result.
The following hypothesis have been taken to put up on test:
H1: The capital adequacy position of HDFC, ICICI, AXIS, BOI, PNB and SBI does not
differ significantly.
H2: The asset quality position of HDFC, ICICI, AXIS, BOI, PNB and SBI does not differ
significantly.
H3: The return on asset (ROA) position of HDFC, ICICI, AXIS, BOI, PNB and SBI does
not differ significantly.
H4: The return on equity (ROE) position of HDFC, ICICI, AXIS, BOI, PNB and SBI does
not differ significantly.
H5: The interest spread position of HDFC, ICICI, AXIS, BOI, PNB and SBI does not
H6: The earning spread position of HDFC, ICICI, AXIS, BOI, PNB and SBI does not
H7: The intermediation cost position of HDFC, ICICI, AXIS, BOI, PNB and SBI does not
H8: The credit/deposit position of HDFC, ICICI, AXIS, BOI, PNB and SBI does not
H9: The interest expended/interest earned position of HDFC, ICICI, AXIS, BOI, PNB and
SBI does not differ significantly.
H10: The interest income/total funds position of HDFC, ICICI, AXIS, BOI, PNB and SBI
does not differ significantly.
H11: The interest expenses/total funds position of HDFC, ICICI, AXIS, BOI, PNB and SBI
does not differ significantly.
H12: The (NIM) of HDFC, ICICI, AXIS, BOI, PNB and SBI does not differ significantly.
METHODOLOGY :-
The present study adopts an analytical and descriptive research design. The data of the
sample companies (for the period of 5 years from 2006-2010) has been collected from
the balance sheet and profit and loss account given in the software ACE equity, and
some information has been collected from the websites of the banks.
A finite sample size of six banks listed on National Stock Exchange (NSE) has been
selected for the purpose of the study. They are HDFC Bank, ICICI Bank, AXIS Bank,
Bank of India (BOI), Punjab National Bank (PNB) and State Bank of India (SBI).
The variables used in the analysis of the data are Capital Adequacy, Asset Quality,
Management Quality, Return On Assets (ROA), Return On Equity (ROE), interest
spread, earning spread, intermediation cost, credit/deposit, interest expended/interest
earned, interest income/total funds, interest expenses/total funds and nim.
While interpreting the results, the statistical tool of one-way Analysis of Variance
(ANOVA) has been used.
SAMPLE DESIGN :-
 Sampling Technique : The study is done with special reference to public and private
sector banks. The reason being that the data or the financial statements are readily
available for them. Apart from this, public sector banks are bound to disclose all their
facts and figure publicly. Thus, the technique of ‘Convenience Sampling’ is being
adopted for the study. The election of sample companies is made on the basis of
market capitalization.
 Sample Size : Three Indian Public sector banks and three Indian Private sector banks
are chosen as sample size for the study on account of having the highest market
capitalization.
DATA COLLECTION :
Financial statements are the raw data collected from Ace equity and from various
websites such as www.rbi.org and the websites of all the banks.
TOOLS USED FOR ANALYSIS :

 Ratio Analysis: Ratios have been calculated for the past five years for the
purpose of analysis.
Ratios being designed are named as:
 Capital Adequacy, Asset Quality, Management Quality, Return On Assets (ROA), Return
On Equity (ROE), interest spread, earning spread, intermediation cost, credit/deposit,
interest expended/interest earned, interest income/total funds, interest expenses/total
funds and nim.
 Analysis of Variance(ANOVA): The statistical tool that is used for testing hypothesis is
one-way Analysis of Variance (ANOVA).
CAPITAL ADEQUACY
Average
HDFC ICICI AXIS BOI PNB SBI
13.926 15.004 13.82 12.224 12.552 8.7
INTERPRETATION : The above diagram depicts that among the private sector banks
HDFC was highest for the first two years and after that ICICI is highest among the all
private sector banks PNB having highest among the all public sector banks. On an
average ICICI BANK has generated highest among all and SBI having lowest among
all. As this ratio measure of how much capital is used to support the banks' risk assets.
The analysis reveals that ICICI is the most efficient bank in terms of meeting with the
liability and other risks such as credit risk, operational risk.
The capital adequacy of sample companies is compared and tested using the following
hypothesis. The details shown below:
Ho: Capital Adequacy of HDFC, ICICI, AXIS, BOI, PNB and SBI does not differ
significantly.
Ha: Capital Adequacy of HDFC, ICICI, AXIS, BOI, PNB and SBI does differ significantly.
Source of Variation DF SS MS F-ratio
Between Groups 5 121.5713 24.31426 6.465842
Within Groups 24 90.25 3.760417
Total 29 211.82
Table Value: 2.62

Inference: Since the calculated value of F is 6.46- which is greater than the table value
of 2.62, the null hypothesis is rejected and the alternative hypothesis is accepted.
Hence, it is concluded that the capital adequacy position of HDFC, ICICI, AXIS, BOI,
PNB and SBI differ significantly.
ASSET QUALITY
Average
.456 1.5 .584 .9 .478 1.738
HDFC is performing well and PNB performing well among the all public sector banks.
On an average SBI BANK has generated highest among all and HDFC having lowest
among all. As this ratio measure of the assets which are not performing good. The
analysis reveals that HDFC is the most efficient bank in terms of managing the assets,
and having lowest ratio of non-performing assets.
The asset quality of sample companies is compared and tested using the following
Ho: Asset Quality of HDFC, ICICI, AXIS, BOI, PNB and SBI does not differ significantly.
Ha: Asset Quality of HDFC, ICICI, AXIS, BOI, PNB and SBI does differ significantly.
Between Groups 5 7.631987 1.526397 11.89401
Within Groups 24 3.08 0.128333
Total 29 10.72
Table Value: 2.62

Inference: Since the calculated value of F is 11.89- which is greater than the table
value of 2.62, the null hypothesis is rejected and the alternative hypothesis is accepted.
Hence, it is concluded that the asset quality position of HDFC, ICICI, AXIS, BOI, PNB
and SBI differ significantly.
MANAGEMENT QUALITY:
Average

5.856 4.276 5.008 6.522 6.128 6.516
HDFC is performing well and BOI and SBI performing well among the all public sector
banks. On an average BOI BANK has generated highest among all and ICICI having
lowest among all. As this ratio measure to what extent a bank is competent in managing
its assets. The analysis reveals that BOI is the most efficient bank in terms of
compliance with set norms, ability to plan and react to changing circumstances,
technical competence, leadership and administrative ability
The management quality of sample companies is compared and tested using the
following hypothesis. The details shown below:
Ho: Management Quality of HDFC, ICICI, AXIS, BOI, PNB and SBI does not differ
significantly.
Ha: Management Quality of HDFC, ICICI, AXIS, BOI, PNB and SBI does differ significantly.
Between Groups 5 20.26914 4.053828 2.685751
Within Groups 24 36.2252 1.509383
Total 29 56.49434
Table Value: 2.62

Hence, it is concluded that the management quality position of HDFC, ICICI, AXIS, BOI,
EARNING RATIO
RETURN ON ASSETS
1.414 1.082 1.258 1 1.204 0.962
Average
HDFC was highest PNB having highest among the all public sector banks. On an
average HDFC BANK has generated highest among all and SBI having lowest among
all. As this ratio measure of return on assets employed by banks. The analysis reveals
that HDFC is the most efficient bank in terms of generating returns on assets employed
by it.
The return on assets of sample companies is compared and tested using the following
Ho: Return on Asset of HDFC, ICICI, AXIS, BOI, PNB and SBI does not differ significantly.
Ha: Return on Asset of HDFC, ICICI, AXIS, BOI, PNB and SBI does differ significantly.
Between Groups 5 0.733387 0.814874 1.478895
Total 29 1.633387
Table Value: 2.62

Inference: Since the calculated value of F is 1.47- which is less than the table value of
2.62, the null hypothesis is accepted and the alternative hypothesis is rejected. Hence,
it is concluded that the return on assets position of HDFC, ICICI, AXIS, BOI, PNB and
SBI does not differ significantly.
RETURN ON EQUITY
Average

17.684 11.106 19.06 21.51 21.01 16.21
AXIS was highest and BOI is highest among the all public sector banks. On an average
BOI BANK has generated highest among all and ICICI having lowest among all. As this
ratio measure of return on equity employed by the banks. The analysis reveals that BOI
is the most efficient bank in terms of generating returns on equity employed by it.
The return on equity of sample companies is compared and tested using the following
Ho: Return on Equity of HDFC, ICICI, AXIS, BOI, PNB and SBI does not differ
significantly.
Ha: Return on Equity of HDFC, ICICI, AXIS, BOI, PNB and SBI does differ significantly.
Between Groups 5 364.9946 72.99892 5.163343
Within Groups 24 339.31 14.13792
Total 29 704.3
Table Value: 2.62

Hence, it is concluded that the return on equity position of HDFC, ICICI, AXIS, BOI,
INTEREST SPREAD
Average

9.846 6.282 7.604 6.032 7.324 6.734
HDFC is highest and PNB having highest among the all public sector banks. On an
average HDFC BANK has generated highest and BOI has generated lowest among all.
As this ratio is measure of earned interest distributed by the banks. The analysis reveals
that HDFC is the most efficient bank in terms of distributing interest.
The interest spread of sample companies is compared and tested using the following
Ho: Interest Spread of HDFC, ICICI, AXIS, BOI, PNB and SBI does not differ significantly.
Ha: Interest Spread of HDFC, ICICI, AXIS, BOI, PNB and SBI does differ significantly.
Between Groups 5 47.69766 9.539532 9.644009
Within Groups 24 23.74 0.989167

Total 29 71.44
Table Value: 2.62

Hence, it is concluded that the interest spread position of HDFC, ICICI, AXIS, BOI, PNB
EARNING SPREAD

6.8 6.132 14.584 25.676 21.758 21.464
AXIS has highest and BOI having highest among the all public sector banks. On an
average BOI BANK has generated highest among all and ICICI having lowest among
all. As this ratio measure of earnings distributed by the banks. The analysis reveals that
BOI is the most efficient bank in terms of distributing earnings.
The earning spread of sample companies is compared and tested using the following
Ho: Earning Spread of HDFC, ICICI, AXIS, BOI, PNB and SBI does not differ significantly.
Ha: Earning Spread of HDFC, ICICI, AXIS, BOI, PNB and SBI does differ significantly.
Between Groups 5 1703.144 340.6288 152.9509
Within Groups 24 53.44912 2.227047
Total 29 1756.593 60.57218
Table Value: 2.62

Hence, it is concluded that the earning spread position of HDFC, ICICI, AXIS, BOI, PNB
INTERMEDIATION COST
Average

3.526 2.95 2.984 2.54 2.924 2.938
ICICI is lowest and BOI having lowest among the all public sector banks. On an average
BOI BANK has generated lowest among all and SBI having second lowest among all.
As this ratio measure of the cost involved in the placement of money with a financial
intermediary. The analysis reveals that BOI is the most efficient bank in terms of placing
the money with a financial institution.
The intermediation cost of sample companies is compared and tested using the
Ho: Intermediation Cost of HDFC, ICICI, AXIS, BOI, PNB and SBI does not differ
significantly.
Ha: Intermediation Cost of HDFC, ICICI, AXIS, BOI, PNB and SBI does differ significantly.
Between Groups 5 2.48739 0.497478 2.951049
Within Groups 24 4.04584 0.168577
Total 29 6.53323 0.225284
Table Value: 2.62

Hence, it is concluded that the intermediation cost position of HDFC, ICICI, AXIS, BOI,
LIQUIDITY RATIO
CREDIT/DEPOSITS (%

67.786 91.098 65.954 72.906 70.36 75.108
ICICI and SBI having highest among the all public sector banks. On an average SBI
BANK has generated highest among all and AXIS having lowest among all. As this ratio
measure of to how much extent a bank is using its deposits (investments of people with
the bank). The analysis reveals that SBI is perfoming well inspite ICICI is highest but it
is more than 80% which means it has to borrow some funds from outside(upto 75% is
best).
The credit/deposit of sample companies is compared and tested using the following
Ho: Credit/Deposit of HDFC, ICICI, AXIS, BOI, PNB and SBI does not differ significantly.
Ha: Credit/Deposit of HDFC, ICICI, AXIS, BOI, PNB and SBI does differ significantly.
Between Groups 5 2056.321 411.2642 15.80544
Within Groups 24 624.49 26.02042
Total 29 2680.811 92.44176
Table Value: 2.62

Hence, it is concluded that the credit/deposit position of HDFC, ICICI, AXIS, BOI, PNB

48.392 72.36 63.168 65 58.006 63.012
HDFC and PNB having lowest among the all public sector banks. On an average HDFC
BANK has generated lowest among all and ICICI generated highest among all. As this
ratio measure of interest expenses occurred to interest earnings. The analysis reveals
that HDFC is the most efficient bank in terms of generating less expenses to earnings
which means earnings are more than the expenses.
The interest expended/interest earnred of sample companies is compared and tested
using the following hypothesis. The details shown below:
Ho: Interest Expended/Interest Earned of HDFC, ICICI, AXIS, BOI, PNB and SBI does not
Ha: Interest Expended/Interest Earned of HDFC, ICICI, AXIS, BOI, PNB and SBI does differ
significantly.
Between Groups 5 1595.695 319.139 19.27071
Within Groups 24 397.46 16.56083

Total 29 1993.155 68.72948
Table Value: 2.62

Hence, it is concluded that the interest expended/interest earned position of HDFC,
ICICI, AXIS, BOI, PNB and SBI differ significantly.
Average

7.432 6.966 6.414 6.68 7.152 6.79
HDFC and PNB having highest among the all public sector banks. On an average
HDFC BANK has generated highest among all and AXIS having lowest among all. As
this ratio measure of interest earnings occurred to total funds. The analysis reveals that
HDFC is the most efficient bank in terms of generating interest income.
The Interest Income/Total Funds of sample companies is compared and tested using
the following hypothesis. The details shown below:
Ho: Interest Income/Total Funds of HDFC, ICICI, AXIS, BOI, PNB and SBI does not differ
significantly.
Ha: Interest Income/Total Funds of HDFC, ICICI, AXIS, BOI, PNB and SBI does differ
significantly.
Between Groups 5 3.236937 0.647387 1.321199
Total 29 15
Table Value: 2.62

Inference: Since the calculated value of F is 1.32- which is less than the table value of
it is concluded that the interest income/total funds position of HDFC, ICICI, AXIS, BOI,
PNB and SBI does not differ significantly.

Average

3.626 5.054 4.054 4.346 4.166 4.274
HDFC and PNB having lowest among the all public sector banks. On an average HDFC
BANK has generated lowest among all and ICICI having highest among all. As this ratio
measure of interest expenses occurred to total funds. The analysis reveals that HDFC is
the most efficient bank in controlling expenses.
The interest expended/total funds of sample companies is compared and tested using
the following hypothesis. The details shown below:
Ho: Interest Expended/Total Funds of HDFC, ICICI, AXIS, BOI, PNB and SBI does not
Ha: Interest Expended/Total Funds of HDFC, ICICI, AXIS, BOI, PNB and SBI does differ
significantly.
Between Groups 5 5.454947 0.601632 0.963593
Within Groups 24 9.06692 0.624363
Total 29 14.52187
Table Value: 2.62

Inference: Since the calculated value of F is .96- which is less than the table value of
it is concluded that the interest expended/total funds position of HDFC, ICICI, AXIS,
BOI, PNB and SBI does not differ significantly.
NET INTEREST MARGIN %
Average

3.802 1.916 2.36 2.332 2.984 2.52
HDFC is highest SBI having highest among the all public sector banks. On an average
HDFC BANK has generated highest among all and ICICI having lowest among all. As
this ratio measure of difference between expenses and income or we can say that the
earnings. The analysis reveals that HDFC is the most efficient bank in terms of
generating earnings.
The net interest margin of sample companies is compared and tested using the
Ho: Net Interest Margin (NIM) of HDFC, ICICI, AXIS, BOI, PNB and SBI does not differ
significantly.
Ha: Net Interest Margin (NIM) of HDFC, ICICI, AXIS, BOI, PNB and SBI does differ
significantly.
Between Groups 5 10.89754 2.179508 29.06011
Total 29 12.7
Table Value: 2.62

Hence, it is concluded that the net interest margin position of HDFC, ICICI, AXIS, BOI,
Conclusion
The fundamental analysis which aims at developing an insight into the economic
performance of the business is of paramount importance from the view point of
investment decisions. Thus, the present study has been conducted to examine the
economic sustainability of the six major banks in Indian banking sector: HDFC Bank,
AXIS Bank, ICICI Bank, SBI, BOI, PNB.
The study reveals that among the six banks HDFC is the most efficient bank , because
the research shows that among the thirteen ratios in seven ratios HDFC perform well
among which the asset quality ratio, return on assets, interest spread ratio and the most
important ratio (net interest margin) are the ratios in which HDFC bank perform well,
after that BOI is the second efficient bank because it performed well in four ratios that is
intermediation cost ratio, earning spread ratio return on equity and management quality,
after these two banks ICICI performing well in capital adequacy ratio which is another
most important ratio and SBI perform well in credit/deposit ratio the another most
important ratio
.
The research also reveals that in all the ratios banks differ significantly from each other
which reveals that the functioning of one bank is differ from the other bank. But these
banks does not differ from each other in all these ratios that is interest expended/total
funds, interest income/total funds and return on assets. Which reflects that under these
aspects banks are more or less same.

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INDUSTRY PROFILE

INTRODUCTION TO THE INDIAN BANKING INDUSTRY

Reserve Bank of India

Regulator and supervisor of the financial system:

Manager of Foreign Exchange

GROWTH OF BANKING INDUSTRY

STATE BANK OF INDIA:

CURRENT RATES AND RATIOS:

Repo rate 5.75%

Reverse repo rate 4.50%

Base rate 7.50%-8.00%

Saving bank rate 3.5%

Deposit rate 6.00%-7.50%

LATEST TREND IN BANKING SECTOR

Tele Banking: Telephone banking is a service provided by a financial institution, which

LIMITATIONS OF FINANCIAL ANALYSIS :-

Cross Sectional Analysis : Under this technique of analysis, financial statements of

Cross Sectional-cum-Time Series Analysis: This is the most effective approach of

A Bank is sound in every respect

B Bank is fundamentally sound but with moderate weaknesses

financial, operational or compliance weaknesses that give cause for

serious or immoderate finance, operational and managerial

critical financial weaknesses and there is high possibililty of failure in

TOTAL CAR BASEL I (%)&TOTAL CAR BASEL II (%)

INTERPRETATION :- This ratio indicates to what extent a bank is competent in

INTERPRETATION :- This ratio represents return on assets and equity employed by

INTEREST SPREAD RATIO (%) & EARNING SPREAD RATIO (%)

INTERMEDIATION COST RATIO (%)

INTERPRETATION :- INTERMEDIATION COST, in finance, is the cost involved in the

INTERPRETATION :- Credit to deposit ratio represents to how much extent a bank is

INTEREST EXPENDED / INTEREST EARNED (%)

INTEREST INCOME / TOTAL FUNDS (%)

INTEREST EXPENDED / TOTAL FUNDS (%)

INTERPRETATION :- This ratio indicates to what extent a bank is competent in

INTERPRETATION :- This ratio represents return on assets and equity employed by

INTEREST SPREAD RATIO (%) &EARNING SPREAD RATIO (%)

INTERMEDIATION COST RATIO (%)

INTERPRETATION :- INTERMEDIATION COST, in finance, is the cost involved in the

INTERPRETATION :- Credit to deposit ratio represents to how much extent a bank is

INTEREST EXPENDED / INTEREST EARNED (%)

INTEREST INCOME / TOTAL FUNDS (%)

INTEREST EXPENDED / TOTAL FUNDS (%)

INTERPRETATION :- This ratio represents return on assets and equity employed by

INTEREST SPREAD RATIO (%) &EARNING SPREAD RATIO (%)

INTERMEDIATION COST RATIO (%)

INTERPRETATION :- INTERMEDIATION COST, in finance, is the cost involved in the

INTERPRETATION :- Credit to deposit ratio represents to how much extent a bank is

INTEREST EXPENDED / INTEREST EARNED (%)

INTEREST INCOME / TOTAL FUNDS (%)

INTEREST EXPENDED / TOTAL FUNDS (%)

INTERPRETATION :- This ratio indicates to what extent a bank is competent in

INTERPRETATION :- This ratio represents return on assets and equity employed by

INTERMEDIATION COST RATIO (%)

INTERPRETATION :- INTERMEDIATION COST, in finance, is the cost involved in the

INTERPRETATION :- Credit to deposit ratio represents to how much extent a bank is

INTEREST EXPENDED / INTEREST EARNED (%)

INTEREST INCOME / TOTAL FUNDS (%)

INTEREST EXPENDED / TOTAL FUNDS (%)

INTERPRETATION :- This ratio indicates to what extent a bank is competent in

INTERPRETATION :- This ratio represents return on assets and equity employed by

INTEREST SPREAD RATIO (%)&EARNING SPREAD RATIO (%)

INTERMEDIATION COST RATIO (%)