The CAMELS model is one of the widely used criteria to measure the risk, safety and

profitability in the banking industry.

C-Capital Adequacy Ratio

A-Asset Quality

M-Management

E-Earning Quality

L-Liquidity

S-Safety against market risk

Management Efficiency Ratios

Profit Per Branch= Total Net Profit/No. of Branches

Mar’06 Mar’07 Mar’08 Mar’09 Mar’10

= 676/2082=0.32 =845/2206= 0.38 =1387/2361= 0.59 =1727/2558= 0.68 =2075/2805= 0.74

0.8

0.7

0.6

0.5

0.4

0.3

0.2

0.1

0
Mar'06 Mar'07 Mar'08 Mar'09 Mar,10

ANALYSIS

The profit per branch is showing a declining trend due to the expansion spree and possibly also
because the bank branches are not able to improve upon their operational efficiency. The
comparison shows that profits improved drastically in 2008 but it gradually came down to 8.8%
in 2010.

Gross Profit Per Employee= Gross Profit/No. of Employees

Mar’06 Mar’07 Mar’08 Mar’09= Mar’10

=110836/25421 =132183/25969 =159477/25722 =190920/27510 =236895/27772

= 4.36 = 5.09 = 6.20 = 6.94 = 8.53

9
8
7
6
5
4
3
2
1
0
Mar'06 Mar'07 Mar'08 Mar'09 Mar,10

ANALYSIS

The gross profit per employee has shown an impressive performance over the years and it has
been well-maintained because of the smooth manpower planning and the deployment of
personnel in each branch on a yearly basis. The highest gross profit per employee is 26.83% in
2006, which has been 22.90% during 2010.

Net Profit Per Employee= Net Profit/No. of Employees

Mar’06 Mar’07 Mar’08 Mar’09 Mar’10

=67620/25421 =84400/25969 =138642/25722 =172763/27510 =207457/27772

=2.66 =3.25 =5.39 =6.28 =7.47
 8

0
Mar'06 Mar'07 Mar'08 Mar'09 Mar,10

ANALYSIS

The net profit per employee had escalated very high during the year 2007 and then it had fallen
drastically and stood at a maintained level in the years 2008& 2009.The net profit had zoomed to
65.85% during the year ended March 2007 and then it had fallen down to 18.95%.

Business Per Branch= Avg. Deposits+ Avg. Advances/No. of Branches

Mar’06 Mar’07 Mar’08 Mar’09 Mar’10

=110950/2082 =132228/2206 =159415/2361 =190852/2558 =236994/2805

=53.29 =59.94 =67.52 =74.61 =84.49

Mar,10

Mar'09

Mar'08

Mar'07

Mar'06

0 10 20 30 40 50 60 70 80 90
ANALYSIS

The business per branch was maintained over the years from 2006 to 2010.The year 2006
showed a modest increase in the business volume at 12.47% during the year 2006 and it was at
its peak recording 13.24% during the year 2010.

Gross Profit Per Branch= Gross Profit/No. of Branches

Mar’06 Mar’07 Mar’08 Mar’09 Mar’10

=1457/2082 =2007/2206 =2574/2361 =3070/2558 =3647/2805

=0.70 =0.91 =1.09 =1.20 =1.30

0
Mar'06 Mar'07 Mar'08 Mar'09 Mar,10

ANALYSIS

The gross profit per branch is coming down drastically as a percentage because of the sharp
increase in the number of branches and the operational inefficiency of the branches over the
years. In the year 2007 it was a healthy 30% and it gradually came down to 8.33%.

Earnings Per Share= Net Profit/Equity Shares*10

Mar’06 Mar’07 Mar’08 Mar’09 Mar’10

=675/463*10 =838/500*10 =1393/510*10 =1739/509*10 =2076/505*10

=14.58 =16.74 =27.46 =34.18 =41.08
 50
45
40
35
30
25
20
15
10
5
0
Mar'06 Mar'07 Mar'07 \

ANALYSIS

The earnings per share has shown a noteworthy performance in the year 2008 after which it had
fallen down till the year 2010.The earnings per share increased to 64% for the year 2008 and
then the rate of increase slowed down to 24.47% in 2009 and further to 20.18% in 2010.

Earning Quality Ratios

Operating Profit to Avg. Working Funds= [Interest Income+ Non-interest Income] –
[Interest Exp+ Non-interest Income]/ [Loans & Advances+ Investment]

Mar’06 Mar’07 Mar’08 Mar’09 Mar’10

=1298/85688 =1380/91403 =1686/110359 =2202/135452 =2510/189496

=0.015 =0.015 =0.015 =0.016 =0.013

0.02
0.02
0.01
0.01
0.01
0.01
0.01
0
0
0
Mar'06 Mar'07 Mar'08 Mar'09 Mar,10
ANALYSIS

The operating profit to average working funds has been constant during the years 2006 to 2008
and then shows a rise in 2009 and gradually it shows negative growth. During the year 2009 the
rise has been 6.67% and during the year 2010 it is showing negative growth of (18.75) % due to
heavy lending volume of the bank and the failure to recover the dues from the creditors. Though
the bank has tried to reduce its operating expenses, it could not squeeze the lending facility an
volume of credit.

Operating Efficiency Ratio= Total Operating exp./ Total Assets

Mar’06 Mar’07 Mar’08 Mar’09 Mar’10

=4961/89126 =6311/102678 =8438/124073 =10700/160976 =12157/195162

=0.056 =0.061 =0.068 =0.066 =0.062

0.07

0.06

0.05

0.04

0.03

0.02

0.01

0
Mar'06 Mar'07 Mar'08 Mar'09 Mar,10

ANALYSIS

The operating efficiency of the banks has been good during the period 2006-2008, after that there
was a negative growth in the year 2009 and generally it was sustained very slowly in the year
2010.The growth rate was between 9-11.5% during the year 2006-2008, it feel down to (3.03) %
in 2009 and moved up only 1.64% in the year 2010.
Cost to Income Ratio= Non-interest Income/ Net Total Income

Mar’06 Mar’07 Mar’08 Mar’09 Mar’10

=494/6489 =687/8224 =1087/10680 =1483/13372 =1975/15277

=0.076 =0.08 =0.10 =0.11 =-0.13

Mar,10

Mar'09

Mar'08

Mar'07

Mar'06

0 0.02 0.04 0.06 0.08 0.1 0.12 0.14

ANALYSIS

The analysis highlights that the growth in the years 2008 and 2010 has been negative at (1.26) %
and (1.82) % respectively, whereas the years 2007 and 2009 showed positive growth at 5.26%
and 22.22% respectively. The reason behind such fluctuation is that the cost factor in the bank
has accelerated and sufficient total income generated could not sustain the ratio.

Liquidity Ratio

Cash to Total Assets= Cash and Bank balances including call money/ Total Assets

Mar’06 Mar’07 Mar’08 Mar’09 Mar’10

=6390/89126 =8427/102678 =10098/124073 =15985/160976 =15777/195162

=0.072 =0.082 =0.081 =0.099 =0.081
 0.12

0.1

0.08

0.06

0.04

0.02

0
Mar'06 Mar'07 Mar'08 Mar'09 Mar,10

ANALYSIS

The trend shows a very highly fluctuating growth over the years because of a very high degree of
increase in both the cash balance and the asset base of the bank. The percentage of increase in
the year 2007 is 13.89% followed by a negative growth of (1.23) % in 2008.The year 2009 saw a
huge recovery in the percentage showing 22.22% growth and then in the year 2010,it was a
slump with growth registering at (18.18) %.

Cash to Total Deposits= Cash and Bank balances/ Total Deposits

Mar’06 Mar’07 Mar’08 Mar’09 Mar’10

=6390/74094 =8427/85180 =10098/103858 =15985/138703 =15777/170040

=0.086 =0.095 =0.097 =0.115 =0.092

0.14

0.12

0.1

0.08

0.06

0.04

0.02

0
0.5 1 1.5 2 2.5 3 3.5 4 4.5 5 5.5
ANALYSIS

The analysis shows that the bank has been able to raise its total deposits over the years, but the cash
position has also increased simultaneously. In the year 2007 it had seen a growth of 10.46% and then
gradually it was maintained, but in the year 2010 it has shown a negative growth of (20.00) %.This is
possibly the effect of inflation and a rise in the deposit rates by the bank.

Short-term Investments to Total Assets= Investments in money market instruments and

other short-term assets/ Total Assets

Mar’06 Mar’07 Mar’08 Mar’09 Mar’10

=25918/89126 =27982/102678 =33823/124073 =42997/160976 =54403/105162

=0.29 =0.27 =0.27 =0.27 =0.52

Mar,10

Mar'09

Mar'08

Mar'07

Mar'06

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

ANALYSIS

The trend chart shows that there has been negative investment or disinvestment of approximately
(6.90) % from 2007 and henceforth till 2009, there was zero growth. The year 2010 saw
voluminous growth in investments at the rate of 92.59 % over the previous year.