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    Task 18: Ratios Peer Comparison of SBI and PNB With Other PSB Interest Income / Total Asset

    Uploaded by

    Bijosh Thomas
    This document provides ratio analyses comparing State Bank of India (SBI) and Punjab National Bank (PNB) to other public sector banks for the years 2018-2020. It analyzes ratios such as interest income to total assets, non-interest income to total assets, operating profit to total assets, operating expenses to total assets, and interest expenses to total assets. The document also provides a CAMEL analysis for SBI and PNB, evaluating their capital adequacy, asset quality, management, earnings, and liquidity. Finally, it outlines an investor profile for an individual seeking to create a retirement plan and assess their family assets, liabilities, income, expenses, goals, and assumptions.

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    Task 18: Ratios Peer Comparison of SBI and PNB With Other PSB Interest Income / Total Asset

    Uploaded by

    Bijosh Thomas
    42 views6 pages
    This document provides ratio analyses comparing State Bank of India (SBI) and Punjab National Bank (PNB) to other public sector banks for the years 2018-2020. It analyzes ratios such as interest income to total assets, non-interest income to total assets, operating profit to total assets, operating expenses to total assets, and interest expenses to total assets. The document also provides a CAMEL analysis for SBI and PNB, evaluating their capital adequacy, asset quality, management, earnings, and liquidity. Finally, it outlines an investor profile for an individual seeking to create a retirement plan and assess their family assets, liabilities, income, expenses, goals, and assumptions.

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    This document provides ratio analyses comparing State Bank of India (SBI) and Punjab National Bank (PNB) to other public sector banks for the years 2018-2020. It analyzes ratios such as interest income to total assets, non-interest income to total assets, operating profit to total assets, operating expenses to total assets, and interest expenses to total assets. The document also provides a CAMEL analysis for SBI and PNB, evaluating their capital adequacy, asset quality, management, earnings, and liquidity. Finally, it outlines an investor profile for an individual seeking to create a retirement plan and assess their family assets, liabilities, income, expenses, goals, and assumptions.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    42 views6 pages

    Task 18: Ratios Peer Comparison of SBI and PNB With Other PSB Interest Income / Total Asset

    Uploaded by

    Bijosh Thomas
    This document provides ratio analyses comparing State Bank of India (SBI) and Punjab National Bank (PNB) to other public sector banks for the years 2018-2020. It analyzes ratios such as interest income to total assets, non-interest income to total assets, operating profit to total assets, operating expenses to total assets, and interest expenses to total assets. The document also provides a CAMEL analysis for SBI and PNB, evaluating their capital adequacy, asset quality, management, earnings, and liquidity. Finally, it outlines an investor profile for an individual seeking to create a retirement plan and assess their family assets, liabilities, income, expenses, goals, and assumptions.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    of 6

    Task 18

    RATIOS
    Peer comparison of SBI and PNB with other PSB
    Interest income / Total asset:
    PARTICULARS MARCH 2020 MARCH 2019 MARCH 2018
    SBI 6.42 6.51 6.33
    PNB 6.44 6.6 6.25
    BOB 6.57 6.45 6.15
    UNION BANK 6.74 6.88 6.7
    CANARA BANK 6.71 6.73 6.54
    This ratio refers to the interest earned on the total assets used for this purpose to determine whether
    the rate is good, too high, or too low in order for the responsible management to decide whether to
    continue leaving these assets as is or use them differently. From the above chart we can find that
    union bank has the highest ratio as compared to other banks.Sbi has the lowest ratio and the interest
    income earned compared to assets is low for SBI .

    Non-interest income / Total asset


    PARTICULARS MARCH 2020 MARCH 2019 MARCH 2018
    SBI 2.2 1.97 2.14
    PNB 1.1 0.93 1.14
    BOB 1.01 0.96 1.06
    UNION BANK 1.04 1.01 1.11
    CANARA BANK 1.59 1.39 1.17
    Sbi has the highest ratio and it increased from last year.BOB ha the lowest ratio but the ration
    increased as compared to last year.The ratio of all banks increased from last year

    Operating profit / Total Asset


    PARTICULARS MARCH 2020 MARCH 2019 MARCH 2018
    SBI -1.76 -1.89 -2.26
    PNB -1.05 -2.2 -2.75
    BOB -0.93 -0.82 -1.32
    UNION BANK -1.58 -1.59 -2.17
    CANARA BANK -1.86 -1.31 -1.81
    Operating return on assets is used to show a company’s operating income that is generated per
    rupees invested specifically in its assets that are used in its everyday business operations.All the banks
    have negative ratio which says that there operating profit is not at good level.BOB has the highest
    ratio and canara bank has the lowest ratio as compared to other banks
    Operating expense / Total asset
    PARTICULARS MARCH 2020 MARCH 2019 MARCH 2018
    SBI 3.13 2.95 2.65
    PNB 1.42 1.48 1.75
    BOB 1.71 1.55 1.51
    UNION BANK 1.47 1.57 1.4
    CANARA BANK 2.16 2.04 1.55
    Operating expense to total asset ratio of SBI was high compared to other banks and there is significant
    rise in SBI, BOB and Canara bank. Union bank has the lowest ratio and there is increase in ratio of PNB.

    Interest expense/total asset


    PARTICULARS MARCH 2020 MARCH 2019 MARCH 2018
    SBI 3.83 4 4.05
    PNB 4.34 4.39 4.3
    BOB 4.17 3.96 3.89
    UNION BANK 4.65 4.79 4.77
    CANARA BANK 4.83 4.54 4.61
    Interest expense to total asset ratio is high for Canara bank and union bank while SBI has the lowest
    ratio, there is decrease in the ratio for SBI, Union bank, PNB and BOB and canara bank has shown
    an increase in the ratio.

    CAMEL ANALYSIS OF SBI

    CAPITAL ADEQUACY RATIO


    PARTICULARS MARCH 2020 MARCH 2019 MARCH 2018
    Capital Adequacy Ratio 13.13 12.72 12.60

    ASSET QUALITY
    PARTICULARS MARCH 2020 MARCH 2019 MARCH 2018
    GROSS NPA 149,091.85 172,753.60 223,427.46
    GROSS NPA (%) 6.00 8.00 11.00
    NET NPA 51,871.30 658,947.40 110,854.70
    NET NPA (%) 2.23 3.00 6.00
    NET NPA TO 2.00 3.00 6.00
    ADVANCES (%)
    CREDIT DEPOSIT 73.75 73.79 80.38
    RATIO
    EPS 22.15 2.58 -5.34
    MANAGEMENT
    PARTICULARS MARCH 2020 MARCH 2019 MARCH 2018
    RETURN ON INVESTMENT 0.47 0.05 -0.12
    RETURN ON EQUITY 8.69 0.98 -2.21

    EARNINGS
    PARTICULARS MARCH 2020 MARCH 2019 MARCH 2018
    GROSS PROFIT -7.93 7.62 6.81
    MARGIN%
    NET PROFIT MARGIN% 6.73 1.21 -1.82
    NET INTEREST 2.59 2.50 2.27
    MARGIN
    NET INTEREST 6.42 6.51 6.33
    INCOME

    LIQUIDITY
    PARTICULARS MARCH 2020 MARCH 2019 MARCH 2018
    CURRENT RATIO 0.08 0.09 0.08
    QUICK RATIO 8.57 9.13 8.09

    VALUATION
    PARTICULARS MARCH 2020 MARCH 2019 MARCH 2018
    PRICE TO EARNINGS 8.89 124.32 -46.80
    RATIO
    PRICE TO BOOK VALUE 0.77 1.22 1.09
    RATIO
    DIVIDEND PAYOUT 0.03 0.98 -4.39
    RATIO

    CAMEL ANALYSIS OF PUNJAB NATIONAL BANK


    CAPITAL ADEQUACY RATIO
    PARTICULARS MARCH 2020 MARCH 2019 MARCH 2018
    CAPITAL 14.00 10.00 10.00
    ADEQUACY RATIO

    ASSET QUALITY
    PARTICULARS MARCH 2020 MARCH 2019 MARCH 2018
    EPS 0.80 -29.68 -54.71
    NET NPA% 2.23 3.01
    GROSS NPA 6.15 7.53
    CREDIT DEPOSIT 67.47 67.74 67.52
    MANAGEMENT
    PARTICULARS MARCH 2020 MARCH 2019 MARCH 2018
    RETURN ON 95.34 100.72 156.80
    INVESTMENT
    RETURN ON EQUITY 0.74 -22.51 -31.26

    EARNINGS
    PARTICULARS MARCH 2020 MARCH 2019 MARCH 2018
    GROSS PROFIT 14.21 15.50 18.38
    MARGIN
    NET PROFIT MARGIN% 0.66 -19.22 -25.82
    NET INTEREST 2.10 2.21 1.95
    MARGIN

    LIQUIDITY
    PARTICULARS MARCH 2020 MARCH 2019 MARCH 2018
    CURRENT RATIO 0.05 0.05 0.05
    QUICK RATIO 38.14 35.12 22.71

    VALUATION
    PARTICULARS MARCH 2020 MARCH 2019 MARCH 2018
    PRICE TO EARNINGS 246.06 -10.81 -4.57
    RATIO
    PRICE TO BOOK VALUE 0.37 1.03 0.68
    RATIO
    DIVIDEND PAYOUT
    RATIO

    INVESTOR PROFILE SHEET


    Personal information

    My name is Ram Krishnan

    I am 47 years or age employed with Hedge Wealth Management Services as a Financial

    Advisor. In my profession, I work with a team that provides need based Financial Advisory

    services to retail, HNI and corporate clients. As the New Year 2020 in mid, I have decided to

    prepare/review my personal financial plan.

    Spouse name: Lekshmi Mohan


    Age: 45

    Life parameters

    • My expected life: 75 years

    • My spouse expected life :80 years

    • My retirement age :60

    • My monthly salary (FY2019-2020): Rs 65,000

    Other income:

    • Rents – Rs 25,000

    • My monthly expenses/outflows of cash:

    • Household expenses: Rs 30,000

    • School fees for children: Rs 20,000

    • House rent – 0

    • Electricity, phone etc: Rs 1800

    • Car loans +EMI: Rs 14,000+Rs 5000

    • Any other loan repayments, EMI:

    • Insurance Premiums: Rs 6,000 p. a

    My Family Assets:

    • House: Rs 50,00,000

    • Other property: Rs 30,00,000

    • Car: Rs 13,00,000

    • Providend Fund: Rs 5000

    • My liabilities:

    • Car loan: Rs 13,00,000

    • Home loan: Rs 30,000 p.m. for 45 years

    • Personal loan: Rs 9,000 p.m. for 10 years

    Assumptions regarding economic factors (% per year)

    • Inflation: 3.34%

    • Expected return on risk free investments: 3.22%

    My Goals (input numbers based on current costs and expected cost escalations when you

    will actually need it)


    1. Create a Retirement corpus needed at retirement age to sustain same lifestyle till expected

    life time

    • Investment in Post Office Monthly Income Scheme (POMIS) Account for 5 years at Rs

    8,00,000 at 7.80%

    • Investment in tax free bonds with the capital raised in tax free bonds

    • And investing in Senior Citizens Saving Scheme in the 5th year.

    2. Provide for basic / higher education for children.

    1 st child 2 nd child
    1 st to 10th standard 300000 500000
    Graduation 200000 400000
    Post graduation 600000 1200000

    3. Marriage expenses for each child at their respective age of 25 years

    4. Build a dedicated fund for planned vacation expenses – Rs 3,00,000

    5. Ensure sufficient life coverage in place for self. – Rs 10,00,000

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