Professional Documents
Culture Documents
CHAPTER – I
INTRODUCTION
1.1 INTRODUCTION:
Corporation Bank is a public-sector banking company headquartered
in Mangalore, India. The bank has a pan-Indian presence. Presently, the bank has a
network of 2,600 fully automated CBS branches, 3,040 ATMs, and 4,724 branchless
banking units across the country.
Published financial performances are the only source of information about the
activities and affairs of a business entity available to the public, shareholders,
investors and creditors. And the governments. These various groups are interested in
the progress position and prospects of such entity in various ways. But these
performances however, correctly and objectively prepared by themselves. Do not
reveal the significance, meaning, and relationships of the information contained
therein for this purpose, financial performances have to be carefully studied,
dispassionately analyzed and intelligently interpreted. This enables a forecasting of
the prospects. For future earnings, ability to pay interest, debt maturities both current
as well as long -term, and probability of sound financial dividend policies.
Recent Developments
On 14 November Corporation Bank said it raised an amount of Rs 500 crore
of the Basel III compliant Tier-II Bonds (Series1) and the same has been allotted by
the Securities Allotment Committee of the Board of the Bank.
On 2 December 2017, Corporation Bank launched its RuPay Select and RuPay
Platinum credit cards. RuPay credit cards are accepted at all RuPay-enabled 1.5
million-plus PoS terminals and 80,000-plus e-commerce merchants in India and all
ICS Partner acceptance points (POS, e-commerce merchants) globally.
The Founder President Khan Bahadur Haji Abdullah Haji Kasim Saheb
Bahadur, committed to fulfill the long felt banking needs of the people and also to
inculcate the habit of savings, provided the much-needed impetus to founding a
financial institution that would bring about prosperity to the society.
The content of the first Appeal to the public dated 19th February, 1906 speaks
volume about the lofty ideals and ethos behind the foundation. The Founder President
Haji Abdullah declared that:
“This is ‘Swadeshism’ pure and simple and every lover of the country is
expected to come forward and co-operate in achieving this end in view”
The days that followed:
The initial growth was consciously cautious and need based. The first branch
of the Bank was opened at Kundapur in 1923, followed by the second in Mangalore in
1926. The Bank stepped into the then Coorg State in 1934 by opening its seventh
branch at Madikeri. In 1937 the Bank was included in the second schedule of Reserve
Bank of India Act, 1934.
Prosperity to All:
In 1939, the Bank’s name changed from Canara Banking Corporation (Udipi)
Ltd., to “Canara Banking Corporation Ltd.,” and strongly put forth its vision with the
motto-“ Sarve Janah Sukhino Bhavantu” which means“Prosperity to All ”
The second change in the name of the Bank occurred in 1972, from ‘Canara Banking
Corporation Ltd.’ to ‘Corporation Bank Limited.’ and finally ‘Corporation Bank’
following its nationalization on 15th April, 1980.
The end of first phase of banking sector reforms in India had seen the Bank
emerging as the most innovative and dynamic bank in the public sector, outshining
other banks in terms of asset quality, capital adequacy, operational efficiency, well
diversified income base, profitability, productivity, and strong balance sheet.
The Bank has extended Branchless Banking units to 4724 villages and has
issued Smart Cards to all account holders in these villages for enabling them to
operate their accounts at their doorsteps through the Business Correspondents
appointed by the Bank.
Passionate Performer
From 38 Rupees-13 Annas-2 Pies to a business level of Rs.3,29,300 crore and
from a Networth of Rs.5,000/- to Rs.11,737 crore, the evolution of the Bank from a
Nidhi to graduate as a Premier Public Sector Bank and from the early days of
Swadeshism to post-Liberalisation days has been a corporate success story.
General objective
The overall object of the study is to examine and compare the financial
performance of Corporation Bank.
Specific objectives
The specific objective of the study is.
To study and analysis the trends of various elements of the financial performance
of the CORPORATION BANK.
To analysis and compare the risk and solvency position of the CORPORATION
BANK.
To examine and compare the overall profitability of CORPORATION BANK .To
evaluate and compare how effectively the company is utilizing its assets,
To analyze and compare the liquidity position of the CORPORATION
BANK .To Study about CORPORATION BANK and its related aspects like its
products and services history organizational structure subsidiary company etc,
In the present study an attempt has been made to measure evaluate the
financial performance of CORPORATION BANK.
The study is based on secondary data that has been collected from annual
reports of the respective bank, magazines, journals, documents and other published
information.
The study covers the period of 5 years from 2013 – 2014 to 2018-2019 ratio
analysis was applied to analyze and compare the trends in banking business and
financial performance mean and compound growth rate (CGR) have also been
deployed to analyze the trends in banking business profitability,
This study is not without its limitations like any other study one of the
limitation is that financial data beyond audited financial performance was unavailable
to the researcher.
CHAPTER - II
CONCEPTUAL FRAME WORK
INTRODUCTION
Financial performance analysis is the process of identifying the financial
strength and weakness of the firm by properly establishing the relationship between
the items of balance sheet and profit and loss account. It also helps in short term and
long term forecasting and growth can be identified with the help of financial
performance analysis. The dictionary meaning of analysis is to resolve or separate a
thing into its element or components parts for tracing their relation to the thing as
whole and to each other.
This financial analysis helps to highlight the facts and relationships concerning
managerial performance, corporate efficiency, financial strength and weakness and
credit worthiness of the company.
The first step involves the reorganization of the entire financial data contained
the financial performances. Therefore the financial performances are broke down in to
individual components and regrouped into few principle elements according to their
resemblances and affinities. Thus the balance sheet and profit and loss account are
completely re casted and presented in the condensed from entirely different from their
original shape the second step is the establishment of the significant relationship
between the individual components of balance sheet and profit and loss account. This
is done through the application tools of financial analysis like ratio analysis, trend
analysis, common size balance sheet and comparative balance sheet.
Finally, the result obtained by means of application of financial tools is evaluated
value of the business. Credit rating and for testing efficiency of operation.
This financial analysis helps to highlight the facts and relationships concerning
managerial performance, corporate efficiency, financial strength and weakness and
credit worthiness of the company.
OBJECTIVES
Financial performance analysis is very much helpful in assessing the financial
position and profitability of a concern. The main objectives of analyzing the financial
performances are as follows:
The analysis would enable the present and the future earning capacity and the
profitability of the concern.
To study the financial performance analysis of Corporation Bank Ranebennur
To analysis the financial changes over a period of five years
To analyze the financial performances of the company key using financial
tools.
To evaluate the financial position of the company in terms of solvency,
profitability, activity and earnings ratios.
To suggest effective measures in the existing system of the company.
The operational efficiency of the concern as a whole as well as department
wise can be assessed. Hence the management can easily locate the areas of
efficiency and in efficiency.
The solvency of the firm, both short term and long term, can be determined
with the help of financial performances analysis which is beneficial to trade
creditors and debenture holders.
The comparative study in regard to one firm with another firm or one
department with other departments is possible by the analysis of financial
performances.
Analysis of post results in respects of earning and financial position of the
enterprise is of great help in forecasting the future results. Hence it helps in
preparing budgets.
It facilities the assessments of financial stability of the concern.
The long term liquidity position of funds can be assessed by the analysis of
financial performances.
CHAPTER – III
COMPANY PROFILE
INTRODUCTION
Corporation Bank Limited, formerly Corporation Bank, is engaged in lending
and borrowing activities. The Bank's segments include Treasury Operations,
Wholesale Banking, Retail Banking and Other Banking Operations. The Bank offers
personal, corporate, non-resident Indian (NRI) and priority banking products and
services. Its personal products and services include saving accounts, deposits, loans,
cards, Forex, investments, remittance, tax and pensions, and insurance. Its personal
loans include Corp Home, Corp Personal, Corp Vehicle, Corp Vidya, Corp Mortgage,
Padho Pardesh Scheme, Corp Rental, Corp Professional, Corp Vyapar, Corp Shubha
Vivah, Corp Apni Dukan and Corp Skill Loan. Its corporate products and services
include current accounts, cash management, financing, Forex and payroll account. Its
NRI products and services include saving accounts, term deposits, loans and
remittance. Its NRI loans include CORP Home Premium NRI, CORP Vehicle, CORP
Ghar Shobha and CORP Mortgage.
ABOUT
Corporation Bank Limited, formerly Corporation Bank, is engaged in lending
and borrowing activities. The Bank's segments include Treasury Operations,
Wholesale Banking, Retail Banking and Other Banking Operations. The Bank offers
personal, corporate, non-resident Indian (NRI) and priority banking products and
services. Its personal products and services include saving accounts, deposits, loans,
cards, Forex, investments, remittance, tax and pensions, and insurance. Its personal
loans include Corp Home, Corp Personal, Corp Vehicle, Corp Vidya, Corp Mortgage,
Padho Pardesh Scheme, Corp Rental, Corp Professional, Corp Vyapar, Corp Shubha
Vivah, Corp Apni Dukan and Corp Skill Loan. Its corporate products and services
include current accounts, cash management, financing, Forex and payroll account. Its
NRI products and services include saving accounts, term deposits, loans and
remittance. Its NRI loans include CORP Home Premium NRI, CORP Vehicle, CORP
Ghar Shobha and CORP Mortgage.
CORPORATION BANK
Type Public
Traded as BSE: 532179
NSE: CORPBANK
Headquarters Mangalore, Karnataka, India
Website www.corpbank.com
The first branch of a modern bank established in the district was the Bank of
Madras, one of the three Presidency Banks, which set up its office in Mangalore in
1868 largely to cater to the business needs of a few British firms dealing in export of
plantation products. Its agent used to visit Udupi once a fortnight or so, to do banking.
Money remittance had to be made only through postal medium.
To overcome these drawbacks and also to provide banking facilities for Udupi
in particular and the district in general, cosmopolitan group of philanthropists led by
Haji Abdullah Saheb made a bold venture to start this institution. What inspired the
founding fathers was the fervor of “Swadeshism.”For promoting the bank, the
Founder -president made an appeal saying. “The primary object in forming the
‘Corporation ‘is not only to cultivate habits of thrift amongst all classes of people,
without distinction of caste or creed, but also habits of co -operation amongst all
classes. This is Swadeshism’, pure and simple and every lover of the country is
expected to come forward and Co -operate in achieving the end in view.”They rightly
defined Swadeshism as institution -building to aid economic activity through co-
operation of all, shron of distinction of caste and creed.
The setting up of the Canara Banking Corporation Ltd. Seems to have given a fillip to
co-operative banking and also to regular banking elsewhere in the district. Between
1909 and 1917, six co -operative banks came in to being and during the decade
immediately after the First World War (1914-18) South Canara gave birth to as many
as eight banks. It is to the credit of this bank that despite two world wars, economic
depression and stuff competition; the bank not only quite survived, but also made
satisfactory progress.
Having been started at Udupi, the bank first branched out by opening a branch
at kundapur in 1923.The second branch of the bank was opened in 1934 by opening
its seventh branch in madiker in 1937; the bank was included in the second schedule
of Reserve Bank of India Act, 1934, in 1939.
The second changes in the name of the bank occurred in 19722, from Canara
Banking Corporation Ltd. to Corporation Bank Limited. The bank was nationalized in
1980along with 5 other private sector banks. After nationalization, the pace of growth
of the bank accelerated and it made all -around progress. Started as a common man’s
bank, it changed with the times to meet the aspirations of people but never swerved
from its motto –Sarve Janah SukhinoBhavantu meaning Prosperity for All. It
endeavored and succeeded in striking a right balance between traditional values and
innovative approach personalized service and professional outlook and commercial
Considerations. And public concern one of the unique achievements of the bank is
that it has been paying dividend continuously for the last 98 years since its inception.
Today, with the most modern technology driven products and services and nationwide
branches &ATMs, Corporation Bank stands tall among the public sector banks in
India and is hailed as one among the well -managed public sector banks with excellent
track record in all the key parameters of banking. The bank has the second largest
ATM network in the public sector.
Corporation Bank had the honour of playing host to many a distinguished personality.
During the banks platinum jubilee celebrations in 1976,thenew administrative office
building at Pandeshwar Mangalore was opened by Sri B. D. Jatti, the then -Vice -
President of India. The bronze statue of Pandit Jawaharlal Nehru installed by the
bank at the Traffic Island in front of its Corporate Office at Pandeshwar Manglore,
was unveiled by Mr. Justice E.S Venkataramaiah, the then Chief Justice of India In
1992, R. Venkataraman, the then -President of India, visited the bank to inaugurate its
85th anniversary celebrations and 60th anniversary of the bank’s commencement of
operation in Tamil Madison state in 1996, Mr. Justice A. M. Ahmadi, the then -Chief
Justice of India, visited the bank to deliver the 90th year commemorative lecture.
Corporation Bank House, the new premises of the bank’s Car Street Manglore branch,
was inaugurated by Dr Manmohan Singh, who was then the Union Finance Minister.
Dr. C. Rangaraian, the then Governor of Reserve Bank of India, launched the
prestigious deposit product Corp Classic during his visit to the bank’s corporate
office in 1997.The bank’s new Millennium Building was inaugurated by Union
Minister of State for Finance Bike Patil in 2000. In the same year, Union Finance
Minister Yashwant Sinha launched the bank's CorpFast product at the Corporate
Office.
Corporation Bank was the first public sector bank, other than State Bank of
India associates, to achieve 100percentage CBS (Core Banking Solutions) developed
and implemented by Laser Soft Info systems Limited, Chennai. 110 years of banking
Corporation Bank completed hundred and ten years of existence on 12 March 2015.
On the occasion of 107th Foundation day celebrations held at TMA Pai Hall in
Mangalore, five eminent personalities who made immense contributions to the society
were honoured by the bank. They include, Dr. B. M. Hegde, eminent physicians, Dr.
B. Raman Rao, eminent cardiologist, Mrs ElaBhatta, social entrepreneur and founder
of SEWA, Dr. B. R. Shetty, entrepreneur and Dr. Kadri Gopainath, eminent
saxophonist.
A new application for internet banking in IPad was launched on this occasion.
A new caller tune for the bank for Bank’s mobile /landline phones was also
inaugurated in the function.
The Bank has also set up libraries in 25 villages and given away scholarship to
100 meritorious students of such villages for the pursuit of their higher education.
Such libraries will be set up in 75 more villages in a phased manner. Corporation
Bank -A Corporate Journey, the history of the Bank and Haji Abdullah Saheb a
biography of the Bank’s Founder President have been published on the occasion of
the valedictory function of the Bank’s Centenary Celebrations.
HEADQUARTERS
Mangaladevi Temple Road,
Mangalore; Karnataka; Postal Code: 575001
Contact Details: Purchase the Corporation bank.
Website: http://www.corpbank.com
BASIC INFORMATION
Total Employees : Purchase the Corporation Bank report to view
the information.
Outstanding Shares : Purchase the Corporation Bank report to view
the information.
Registered Capital : Purchase the Corporation Bank report to view
the information.
Financial Auditors : Purchase the Corporation Bank report to view
the information.
Incorporation Date : 1906
KEY EXECUTIVES
Purchase the Corporation Bank report to view the information.
Chief Executive Director and Managing Director
Purchase the Corporation Bank report to view the information.
Director
Purchase the Corporation Bank report to view the information.
Director
Purchase the Corporation Bank report to view the information.
Director
Purchase the Corporation Bank report to view the information.
Director
OWNERSHIP DETAILS
Indian Promoters : 93.5%
Banks Fin. Inst. and Insurance : 3.8%
General Public : 1.8%
Mutual Funds and UTI : 0.41%
FII's : 0.3%
SUBSIDIARIES
Corpbank Securities Limited : 100%
Financial values in the chart are available after Corporation Bank report is
purchased.
Projects
To cater to the SME and Agricultural segments, the bank maintains exclusive
SME loan centers in sixteen cities across India.
The bank maintains online banking for its retail and corporate customers
through a system called CorpNet.
The bank also allows personal internet banking through this application.
The bank runs Project Sankalp, a business process re-engineering and
organizational management project.
The bank has a wing named Corp Kiran, an association of wives of senior
executives of Corporation Bank for understaking activities related to corporate
social responsibility (CSR)
Ratings
CRISIL has re-affirmed the following programmes of Corporation Bank:
Rs 2 billion Bond Issue AA
Certificate of Deposits Programme P1+
Fixed Deposits Programme FAAA
VISION
"Emerge as a Model for Inclusive Growth and Innovative Banking Services"
MISSION
To expand our reach to meet the financial needs of people
To provide full range of banking services with innovative product
To continue to adopt modern technology for superior banking experience
To create a rewarding environment for all stakeholders
To continue as a model organization for transparent ethical practices.
AWARDS
The bank bagged ten awards from NABARD for ‘Best Performance under
Self
Help Group (SHG). /Joint Liability Group (JLG) Bank linkage Programme ‘in
In Karnataka State for the F.Y 2013-14& 2014-15.
The Bank has bagged “MSME Banking Excellence Awards 2015thinstituted
by Chamber of India Micro Small &Medium Enterprises. (CIMSME).
The Bank has won under the categories Best MSME
Bank Award for Mid Sized Bank -Winner.
CSR &Business Responsibility Award for Mid -Sized Bank – Runner Up.
Best Bank Award under MUDRA Yojan for Mid -Sized
The Bank also received two runners up awards for National Financial Switch
(NFW) for excellence performance in acquirer transactions and Immediate
Payment
SERVICES (IMPS).
‘SKOCH Achiever Awards -2015.’for National SME Enablement .
VALUES
Our mission is guided by key values:
We value high quality research, teaching, and practice in the field of
management and organization.
We cultivate and advocate ethical behavior in all of aspects of our work.
We provide a dynamic and supportive community for all of our members,
embracing the full diversity of our backgrounds and experiences.
We respect each of our members' voices and seek to amplify their ideas.
We build cooperative relationships with other institutions committed to the
advancement of scholarship and teaching about management and organization.
Project Finance, Corp Vyapar, Corp Rental and Working Capital are just to name a
few of them.
For NRI customers, the Corporation Bank arranges for Speed Cash and Speed
Remittance, Corp Quick Remit, loans, deposits and portfolio services. Forex Facilities
for Residents, NRIs or PIOs are also available.
In the field of personal banking services, any customer can seek services like Corp
Pragathi Account, Current Account, Term Deposit, EMI / Deposit Maturity
Calculator, Home Loan and Insurance, Savings Bank A/C and Loans. This bank
assists in the sale of gold coins and bars. For the convenience of the customers, ATM
Locator has also been introduced.
EDUCATION LOANS
Corporation Bank India Education Loans are provided to students who have
secured admission to technical or professional courses in India or abroad. The
financial assistance is forwarded to applicants who are pursuing courses conducted by
deemed, affiliated or government universities. Employed persons are not eligible for
this loan.
Under this scheme, the bank offers finances for the payment of fees, purchase of
books, payment of caution deposits, travel expenses, purchase of educational
instruments and also for meeting expenses of study tours and thesis.
For study in India, the maximum loan amount that is provided is ` 10 lacs and for
studies abroad, the ceiling is Rs.20 lacs.
HOME LOANS
Corporation Bank India Home Loans are offered under the brand names of
Corp Home - Housing Loan and Corp Flexi Home Loan. New Corp Jeevan Griha
Raksha is a unique home loan insurance scheme being offered by bank in conjunction
with LIC. The home loans are primarily provided for the purchase, construction or
renovation of flats or houses. It may be noted that, Indian residents as well as NRIs
are eligible for the Corp Home - Housing Loan scheme, subject to the fulfillment of
certain conditions, laid down by the bank.
PERSONAL LOANS
Corporation Bank India Personal Loans are offered to the permanent
employees of Central or State Government Offices, pensioners, profit making PSUs,
research institutions and public limited companies to name a few. The loan is
extended towards meeting the personal expenditure needs of customers related to
travel, marriage, family functions, education and the like.
CAR LOANS
Corporation Bank India Car Loans are provided for the purchase of both new
and used cars. The bank offers financing facility for upto15% of the cost of the new
vehicles. The loan type that is provided is called Corp Mobile-Vehicle Loan.
Corporation Bank India Loans are also available for NRIs and corporate clients.
ORGANIZATION STRUCTURE
CHAPTER – IV
DATA ANALYSIS AND
INTERPRETATION
In this part of the paper, detail discussions and analysis of the study findings
are presented. The financial performance evaluation obtained by thoroughly analyzing
the company’s financial performances. Each financial performance indicator
(financial ratio) is presented independently in a graph or a table. The analysis is
presented in the following sequence; first the Financial Highlights of the company’s
followed by the ratios analysis.
CLASSIFICATION OF RATIOS:
1. LIQUIDITY RATIOS:
It studies the short term solvency of a firm by judging its ability to meet the short
term liabilities or obligations with aid of its current assets. The liquidity ratio
measures the ability of the firm to meet its short term obligations and reflects the short
term financial strength or solvency of a firm. The following are the some ratios, which
give indication about the liquidity of the company, these ratios are as follows
CURRENT RATIO:
The current ratio is the ratio of current assets to current liabilities
Ratio = Curent Assets / Curent Liabilities.
The CURRENT ASSETS of the firm represents those assets which can be
converted into cash within a short period of time, normally not exceeding one year, in
the ordinary course of business. The current assets include cash and bank balance,
marketable securities, inventory of raw materials semi finished goods and finished
goods, debtors’ net provision for bad and doubtful debts, bills receivable and prepaid
expenses.
The CURRENT LIABILITIES defined as the liabilities which are short term
maturing obligations to be meeting as an originally contemplated, within a year.
Consists of trade creditors, bills payable, and provision for taxation, dividend payable
and outstanding expenses.
INTERPRETATION:
The higher the ratio, the larger is the amount of rupees available per rupee of
current liabilities, the more is the firm’s ability to meet current obligations and greater
is the safety of funds of short term creditors. This current ratio is the measure of
margin of safety to the creditors. A current ratio of 2:1 is considered satisfactory.
Quick assets –
Current assets except in trade and prepaid expense. Current liabilities –
Current liabilities except bank over draft...note: Quick assets: Current assets – Closing
stock.
INTERPRETATION:
General a quick ratio of 1:1 is considered as idea with represent a satisfactory
financial position. A low quick ratio may be an index of bad liquidity position but not
always or vice-versa.
CASH RATIO:
It is the ratio of cash and market securities to current liabilities.
Cash ratio = Cash + Market security / Current liabilities.
INTERPRETATION:
The standard of 0.5:1 is considered as norms for calculating the cash ratio. This
ratio also indicates liquidity position of the firm and firm’s commitment to meet its
short -term liabilities
INTERPRETATION:
This ratio is an important tool of financial analysis to appraise the financial
structure of the firm. A high ratio shows a large share of financing by creditors of the
firm and a low ratio shows smaller claim of creditors. This ratio indicates the margin
of safety to the creditors. 1: 2 is the satisfactory ratio.
INTERPRETATION:
This ratio is also known as time interest earned ratio. This ratio measures the
debt serving capacity of a firm in so far as fixed interest on long term loan. To high
ratio may imply unused debt capacity. In contrast a low ratio is a danger signal that
the firm is using excessive debt and does not have the ability to offer assured payment
of interest to the lenders.
3. PROFITABILITY RATIOS:
NET PROFIT TO TOTAL ASSETS RATIO:
This ratio measures the relationship between net profit and total assets of the
firms and is obtained as follows.
This ratio indicates the turn on investment in total assets. This is indicates the
efficiency of the management.
INTERPRETATION:
A high ratio of gross profit to sales is a sign of good measurement as it implies
that the cost of the production of the firm is relatively low. It may also be indicative of
a higher sales price without a corresponding increase in the cost of goods sold, etc. A
low gross margin is definitely a danger signal, warranting a careful and detailed
analysis of the factors responsible for it. The important contributory may be
1. High cost of production.2. Low selling price.
INTERPRETATION:
This ratio shows the intensive use of the fixed assets greater the ratio better
will be the earning capacity
INTERPRETATION:
This ratio explains the intensive or otherwise use of working capital; the greater
the ratio better will be the earning capacity.
4. ACTIVITY RATIOS:
This ratio measures the efficiency of the organization in the employment funds in
the business operations.
INTERPRETATION:
The assets turnover ratio, however defined, measures the efficiency of the firm
in managing and utilizing its assets. The higher the turnover ratio the more efficient is
the management and utilization of the assets whiles the low turnover.
INTERPRETATION:
This ratio shows the efficiency or otherwise in using the current assets.
Greater this ratio better will be the efficiency. In other words greater ratio shows
intensive use of current assets.
TOTAL ASSETS TURVOVER RATIO:
This ratio Measures overall performance of the business, it is calculated as.
Total assets turnover ratio = cost of goods sold / Working capital
INTERPRETATION:
It tells about the efficiency and inefficiency in the use of total assets. This ratio
shows now efficiency the assets are employed in the business.
WORKING CAPITAL TURNOVER RATIO:
This ratio Measures the relationship between sales and working capital it is
calculated as.
Working Capital Turnover Ratio = Cost of Goods Sold / Working Capital
INTERPRETATION:
This ratio measures the efficiency of the employment of working capital.
General higher ratio is preferable; the ratio is a measure of the return of total.
35
30
25
20
15 28.84
25.83 23.8 23.45
10 20.11
0
2014-15 2015-16 2016-17 2017-18 2018-19
Interpretation:
The above Table shows that “RATIO OF PROFIT TO INCOME “is low
during the year (2017-18) that is (i.e.23.8%) as compare to 20.11% in (2015-16)
remaining followed by (2016-17) is 20.11 %,( 2015-16) is 23.8%, (2018-19) is
23.45%.
Interpretation:
The above Table shows that “RATIO OF PROFIT TO DEPOSITS” is high
during the year(2014-15) that is 3.66% and low during the year (2017-18) is
2.99%and remaining followed by (2015-16) is 3.02%,(2016-17) is 2.25%, (2018-19)
is 2.92%.
c) RETURN ON ASSETS:
An indicator of how profitable a company is relative to its total assets. Return
on assets gives an idea to how efficient management is at using its assets to generate
profit. Normally it is expected between 0.6% to 2.0%.
TABLE NO 4.1.3 Return on assets= Net Profit/Total Assets*100
Year Net Profit Total assets Return on assets
Return on assets
3.5
3
2.91
2.5
2.46 2.45 2.39
2 Return on assets
1.86
1.5
0.5
0
2014-15 2015-16 2016-17 2017-18 2018-19
Interpretation:
The Table shows that “RETURN ON ASSETS” is mix trend during the study
period. Lowest during the year (2016-17) that is 1.86% and remaining followed by
(2014-15) is 2.91 %,( 2015-16) is 2.46% (2017-18) is 2.45 %. & (2018-19) is 2.39 %.
d) RETURN ON EQUITY:
Return on equity provides investors insight into how efficiently a company is
managing the equity that shareholders have contributed to the company.
TABLE NO 4.1.4 Return on equity=net profit/shareholders fund*100
Year Net profit Shareholders fund Return on equity
Series1
18.39 17.66
16.8 16.73
13.26
Interpretation:
The Table shows that “RETURN ON EQUITY” is decreasing year by year
during study period expect in the year (2014-15).The highest increased ratio in (2014-
15) that is 18.39% and lowest in (2016-17) is 13.26%..
Interpretation:
Ratio of interest earned to interest paid is mixed trend during the study period.
The high increased ratio in (2013) that is 188.74% and then next three years it’s going
to decrease.
60 62.17
59.74 59.65
55.77
50
50.89
40 Ratio of interest to total income
30
20
10
0
2014-15 2015-16 2016-17 2017-18 2018-19
Interpretation:
In this first year is the low ratio is 50.89 in (2014-15).And last four years there
is good increase. The total average ratio is good during the five year study period. The
high increased ratio is 62.17 during the year (2018-19)
Series1
11.25
9.9 10.05 9.43 9.21
Interpretation:
In (2014-15) bank spent high 11.25 ratio of total expenses and spent low in
(2018-19) is 9.21,remaining followed by in (2014-15) is 11.25 in( 2015-16) is 9.90,in
(2016-17) is 10.05, in (2017-18) is 9.43.
Series1
79.87
76.2 76.54
74.16
71.15
Interpretation:
Ratio of expenses to income is very high as expected ratio, Due to increasing
in operating expenses and staff expenses. So this ratio is not satisfactory.
Interpretation:
The Table shows that “INTREST EARNED ON TOTAL INCOME” is mix
trend during the study period. The high increased ratio in (2016) that is 96.24% and
low in (2014-15 &2018-19) is 95.81%.
Series1
10.2
9.43 9.11
7.52
5.77
Interpretation:
In 2014-15 bank spent on operating expenses out of total income that is ratio
9.43, then next year 2016-17 it is increased to 10.02. And in next three years it is
mixed trend during study period.
TABLE NO 4.3.1 Cash deposit ratio=cash in hand + balance with other banks/total
deposits*100
Year Cash in hand+ balance Total Deposits Cash deposit Ratio%
2014-15 2,90,73,179 17,79,45,709 16.33
2015-16 2,73,89,001 22,93,10,107 11.94
2016-17 4,42,12,524 27,77,08,958 15.92
2017-18 1,74,80,594 31,52,04,924 5.54
2018-19 2,58,12,042 34,99,89,551 7.37
SOURCES: ANNUAL REPPORT, 2014-15 TO 2018-19,
2
0
2014-15 2015-16 2016-17 2017-18 2018-19
Interpretation:
The Table shows that “CASH DEPOSIT RATIO” is mix trend during the study
period. The high increased ratio in (2014-15) that is 16.33% and low in (2017-18) is
5.54%.And remaining followed by in (2014-15) is 16.33%, in (2015-16) is 11.94%,
and in (2016-17) is 15.92%.
Interpretation:
The Table shows that “INVESTMENT DEPOSIT RATIO”Is decreasing year
by year due to less investment and decrease in total deposits. The high ratio in 2014-
15 is 18.86%, and low in 2017-18 is 14.21%
Ratio
105
100
100.3
97.8
95 Ratio
92.64
90
88.1
87.31
85
80
2014-15 2015-16 2016-17 2017-18 2018-19
Interpretation:
This ratio is satisfactory for the first four years where ratios are decreasing
year after year but in l year 2017-18 there is a increase in ratio due to decrease in
loans and advances than total deposits. The first three years are good. Normal
expected range is (60-80).
current ratio
0.6
0.5
0.5
0.4 0.42
current ratio
0.35
0.3 0.33
0.2 0.22
0.1
0
2014-15 2015-16 2016-17 2017-18 2018-19
Interpretation:
According to accounting principles, a current ratio of 2:1 is supposed to be
an ideal ratio. Company’s liquidity position is good in all years. These ratios are
above the standard it reveals that good position of liquidity and working capital.
b) Quick Ratio
TABLE NO 4.4.2 Quick Ratio=Liquidity Assets/Current Liabilities
Year Liquidity assets Current liabilities Quick Ratio%
Quick Ratio
9
8 8.25
7.93
7
6
6.02 Quick Ratio
5
4
3
2.73 2.88
2
1
0
2014-15 2015-16 2016-17 2017-18 2018-19
Interpretation:
Quick ratio is trend where for 2014 in 8.25 increased as comparative 2016-17
as 2017-18 in 2.73% and in year 2018-19 is 2.88%.
CORPORATION BANK
BALANCE SHEET AS ON 2014-2018
particulars 2014 2015 2016 2017 2018
Total share capital 167.54 167.54 204.50 229.41 331.11
CHAPTER- V
FINDINGS, SUGGESTIONS,
CONCLUSION
5.1 FINDINGS
The quick ratio has increased for the first three years. However it has declined in
2015-16. Again it has increased in 2016-17. So the liquidity position of the bank is
good. So overall quick ratio is satisfactory to the bank.
In 2014-15 bank spent on operating expenses out of total income that is ratio 9.43,
then next year 2015-16 it is increased to 10.02. And in next three years it is mixed
trend during study period
Ratio of profit to income “is low during the year (2018-19) that is (i.e.23.11%) as
compare to 20.11% in (2016-17) remaining followed by (2017-18) is 20.11 %,
( 2018-19) is 23.8%, (2018) is 23.45%.
The bank is satisfied with the credit deposit ratio because it increased year by year
during the study period, but in current year to increase against deposits, shows
ratio analysis increase in result.
According to accounting principles, a current ratio of 2:1 is supposed to be an
ideal ratio. Company’s liquidity position is good in all years. These ratios are
above the standard it reveals that good position of liquidity and working capital.
This ratio is satisfactory for the first four years where ratios are decreasing year
after year but in l year 2016 there is a increase in ratio due to decrease in loans and
advances than total deposits. The first three years are good. Normal expected
range is (60-80).
5.2 SUGGESTIONS:
Bank has to give more stress to ratio analysis because as it increasing and
decreasing at every year financial performance.
The status of the bank is in good position; expect current year’s profit compare
to previous year, so the bank has to take adequate steps to increase its
profitability.
Liquidity position of the bank is in good position so they try to maintain the
minimum liquidity for the future uncertainty. At the same time they have to
maintain balance between profitability and liquidity.
The bank has to maintain the solvency because to take the ratio analysis factor
in its future uncertainty
The bank has to pay attention on reducing its expenses, by reducing the other
expenses they may get reduction in expenses.
They have to take adequate steps to raise the loans and advances against
deposits, in order to achieve more profit.
Ratio of interest earned to interest paid is already satisfactory to the bank. So
they should maintain it for the future development of the bank.
Investment deposit ratio is decreasing year by year; the bank has to diversify
funds into different sectors in the market, in order to get more profit.
5.3 CONCLUSION:
This project of financial performance analysis in the production concern is
merely a work of the project. But brief knowledge and experience of that how to
analyze the ratio analysis financial performance of the bank. The study undertaken
brought into light of the following conclusion. According to this project I came to
know that from the ratio analysis financial performance it is clear the period of
study .so the bank should focus on getting of profits in the year by taking care internal
as well as external factors. for the growth co –op banks are very helpful they are
providing huge amount of ratio analysis every sector of the economy . This analysis is
surprising that only newly banks contributed 60% in our economic growth.
BIBLIOGRAPHY
BIBLIOGRAPHY
REFERENCE BOOKS
Principles of management accounting : Dr.G.B Baligar.
WEBSITES
www.investopedia.com
www.google.com
OTHER REFFERENCE
Five years annual report of the bank.