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Table of Content:

Contents
Executive Summary.................................................................................................... 2
Introduction................................................................................................................ 3
Discussion.................................................................................................................. 4
Interest Income on Loan and Advances...................................................................4
Return on equity (ROE):........................................................................................... 5
Return on assets (ROA):.......................................................................................... 6
Conclusion.................................................................................................................. 7
Recommendation....................................................................................................... 8
References:................................................................................................................. 9
Appendix.................................................................................................................. 10

Executive Summary :
The purpose of this report is to present the financial performance of NCC Bank Ltd. through
graphical presentations. The researcher explained 3 important components of Financial
Statements, that are Interest Income on Loan And Advances, Return on Equity ( ROE) and
Return on Assets ( ROA). It is known that if the Interest Income, ROA and ROE is higher then it
is better for any company and vice versa. But in case of NCC Bank there interest income at the
highest point is 121 crores on 2013 which is satisfactory but having a poor ROE 8.9% and ROA
0.91 % on 2013 which shows poor performance of the company on that year.
Based on the report the overall condition of NCC Bank is not that much satisfactory

Introduction:
National Credit and Commerce Bank Ltd. bears a unique history of its own. The organization
started its journey in the financial sector of the country as an investment company back in 1985.
The aim of the company was to mobilize resources from within and invest them in such way so
as to develop country's Industrial and Trade Sector and playing a catalyst role in the formation of
capital market as well. Its membership with the browse helped the company to a great extent in
these regard. The company operated up to 1992 with 16 branches and thereafter with the
permission of the Central Bank converted into a fully fledged private commercial Bank in 1993
with paid up capital of Tk. 39.00 crore to serve the nation from a broader platform.
Since its inception NCC Bank Ltd. has acquired commendable reputation by providing sincere
personalized service to its customers in a technology based environment.
The Bank has set up a new standard in financing in the Industrial, Trade and Foreign exchange
business. Its various deposit & credit products have also attracted the clients-both corporate and
individuals who feel comfort in doing business with the Bank..

Discussion:
In this report the researcher discussed about the conditions of interest income on loans and
advances, Return on Equity and Return on Assets of NCC Bank Ltd. from the year 2011-2015.
The graphical presentations are explained below:

Interest Income on Loan and Advances:

Interest Income on Loan and Advances

14000
11668.75

12000
10000

12194.1

12019.78

2013

2014

11146.34

9669.34

8000
taka in lacs

6000
4000
2000
0

2011

2012

2015

year

Interest income on loans and advances is the difference between the revenue that is generated
from a bank's assets and the expenses associated with paying out its liabilities. A typical bank's
assets consist of all forms of personal and commercial loans, mortgages and securities.
The liabilities are the customer deposits. The excess revenue that is generated from the interest
earned on assets over the interest paid out on deposits is the interest income on loans and
advances. As seen that the interest income of NCC Bank Ltd. has a fluctuating tendency. On
2011 the Interest Income shows 97 crore and having a consistent increase the figure ends at
114 crores. So it is understood that the overall condition of NCC Bank Ltd is satisfactorily good
and in a favorable condition for the investors.

Return on equity (ROE):

20.00%

18.98%

18.00%
16.00%
14.00%

11.81%

12.00%

10.93%
9.12%

8.96%

10.00%
8.00%
6.00%
4.00%
2.00%
0.00%

2011

2012

2013

2014

2015

Year

Return on equity (ROE) is the amount of net income returned as a percentage

of shareholders equity. Return on equity measures a corporation's profitability by revealing how
much profit a company generate with the money shareholders have invested.
ROE is expressed as a percentage and calculated as:
Return on Equity = Net Income/Shareholder's Equity
Through the graphical report it is seen that the Return on Equity of NCC Bank Ltd is not
satisfactory. As 2011 to 2015 it continued to fall rather than rise. In 2013 the company had the
lowest ROE but increase a little on 2014 but faced the same downfall on 2015.

Return on assets (ROA):

2.50%
2.12%
2.00%
1.50%
1.16%

1.14%

0.97%

0.91%

1.00%
0.50%
0.00%

2011

2012

2013

2014

2015

Year

Return on assets (ROA) is an indicator of how profitable a company is relative to its total
assets. ROA gives an idea as to how efficient management is at using its assets to
generate earnings. Calculated by dividing a company's annual earnings by its total
assets, ROA is displayed as a percentage. Sometimes this is referred to as "return on
investment".
The formula for return on assets is:

Its seen that the ROA on 2011 is in a very good position but they gradually they fall on the
upcoming years. As seen the ROA is very poor on 2015.it seems NCC Bank is not utilizing their

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assets properly of which the rate of ROA is decreasing. Which is not a satisfactory result for the
investors.

Conclusion :
From the above discussion it can be said that though the interest income of NCC Bank has
increased on the last 5 years but the ROE is very poor. Shareholders cant expect high
returns in the long term if the ROE is low. Similarly ROA is also low for NCC Bank
that shows utilization of assets of NCC bank is low. So as a result investors are
having a poor return on their investments.

Recommendation:
NCC Bank should focus on their ROA and ROE. The company should pay more
attention on this two sectors to grab investors generating more profit. Besides the
company should analyze more on the reasons of their downfall on this two sectors.

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References:
http://thebusinessferret.com/key-financial-metrics/return-on-assets/

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http://www.investopedia.com/terms/r/returnonassets.asp
https://www.nccbank.com.bd/

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Appendix: