FIN 464

BANK MANAGEMENT
SPRING2023

Bank Performance Analysis between National Credit and Commerce Bank and One Bank

Submitted to: Trisha Ahmed (TSA), Lecturer

Department of Accounting and Finance
North South University
Section: 5

SUBMITTED BY GROUP 3:
Enam Ul Sajid 2012914030
Rasib Mostofa 2012244630
Md. Faiaz – Al - Ishmam 2013773030
Afia Tasnim Haque Subah 2012573030
Sanjida Shahabuddin 2012432630
Table of Contents
Executive Summary.....................................................................................................................................3
Bank Overview.............................................................................................................................................4
National Credit and Commerce Bank Limited..........................................................................................4
One Bank Ltd...........................................................................................................................................4
Bank Performance Analysis.........................................................................................................................5
Liquidity Ratios:.......................................................................................................................................5
Cash Position Indicator:...........................................................................................................................5
Liquid securities indicator:.......................................................................................................................6
Capacity ratio:..........................................................................................................................................8
Profitability Ratio.....................................................................................................................................9
Return on equity......................................................................................................................................9
Return on Assets....................................................................................................................................10
Net interest margin................................................................................................................................11
Net non-interest margin........................................................................................................................13
Earnings per share.................................................................................................................................14
Financial Risk.........................................................................................................................................15
Debt Ratio:.............................................................................................................................................16
Debt to Equity Ratio:..............................................................................................................................17
Market position.....................................................................................................................................18
Price earnings Ratio...............................................................................................................................18
Market to Book value ratio....................................................................................................................19
Dividend Per share.................................................................................................................................21
Efficiency Ratio......................................................................................................................................23
Operating Efficiency...............................................................................................................................23
Employee Productivity...........................................................................................................................25
Credit Rating..............................................................................................................................................27
Capital Adequacy Ratio:.............................................................................................................................28
Conclusion.................................................................................................................................................30
References.................................................................................................................................................31
Executive Summary
This report provides an in-depth analysis of the performance of the National Credit and
Commerce Bank (NCCB) and One Bank over the five-year period from 2018 to 2022. The
analysis reveals that both banks experienced significant growth during the five-year period, with
NCCB demonstrating consistent financial stability and maintaining a robust capital adequacy
ratio. One Bank, on the other hand, exhibited a higher growth trajectory compared to NCCB.
Profitability analysis indicates that both banks achieved positive net income during the five-year
period. In terms of asset quality, both banks maintained a relatively low level of non-performing
loans (NPLs) throughout the analyzed period. However, both banks should continue monitoring
their loan portfolios and implementing proactive measures to mitigate potential credit risks. This
analysis provides valuable insights for the management teams, regulators, and investors of
NCCB and One Bank, enabling them to formulate strategies that foster sustainable growth and
strengthen their market positions.
Bank Overview
National Credit and Commerce Bank Limited
As an investment business, National Credit and Commerce (NCC) bank began its venture in the
country's financial sector in 1985. The company’s mission is to provide exceptional financial
services to our communities via strong client relationships, and long-term solutions to our clients
and stakeholders by integrating cutting-edge technology, experience, and financial power and
creating a coherent and welcoming atmosphere in which our customers and employees may
thrive. The goal was to mobilize resources from within and invest them in order to strengthen the
country's industrial and trade sectors while also acting as a catalyst in the establishment of the
capital market. With Central Bank clearance, the company operated 16 branches until 1992
before turning to a full-fledged private commercial enterprise.
The bank was established in 1993 with a paid-up capital of Tk. 39 billion to serve the country on
a larger scale. NCC Bank Ltd. has created a respectable reputation by providing honest, attentive
service to each of its clients in a technologically sophisticated atmosphere since its inception.
The Bank has set a new standard for commerce, foreign exchange, and industrial credit.
Furthermore, the bank's diverse deposit and credit products have attracted corporate and
individual clients who are comfortable doing business with it.
One Bank Ltd
In May 1999, ONE Bank Limited was registered as a private commercial bank with the Registrar
of Joint Stock Companies. The bank is expected to give the greatest level of devotion to the
community and its clients. The primary areas of focus are efficiency, transparency, accuracy, and
motivation, with the spirit and determination to thrive as ONE Bank in terms of both value and
image. ONE Bank Limited was incorporated in May 1999 as a private commercial bank with the
Registrar of Joint Stock Companies. The bank is required to give its full commitment to the
community and its consumers. The primary areas of focus are efficiency, transparency,
correctness, and motivation, with the spirit and dedication to prosper as ONE Bank in both
quality and reputation.
OBL is a private sector commercial bank that takes deposits from the public through its multiple
saving programs and lends the funds in various industries at a profit. In selecting an asset and
liability portfolio, proper risk assessment and compliance are carefully followed. Bank finance
focuses on both working capital and long-term borrowing. The textile and RMG industries are
the bank's primary focus in the industrial sector. With greater exposure to RMG, the bank's non-
funded business has grown significantly. The bank has taken the initiative to grow its exposure in
SMEs in order to boost small enterprises' access to bank financing. OBL has real-time online
banking and has developed Visa debit and credit cards, ATMs, E-Banking, Mobile banking, and
other services. A full-fledged Disaster Recovery (DR) center has been created in Sirajganj to
safeguard the bank's operational continuity. OBL has established a centralized loan
administration and trade processing center in the Dhaka and Chattogram zones.
Bank Performance Analysis
Liquidity Ratios:
The liquidity ratio is a financial statistic that evaluates a company's ability to satisfy short-term
borrowing commitments. The indicator is used to determine if a company has sufficient liquid
assets, or current assets, to meet its current liabilities. The three most common liquidity ratios are
the current ratio, quick ratio, and cash ratio. Each liquidity ratio has a denominator indicating the
number of existing obligations and a numerator representing the amount of liquid assets. Because
of the nature of the ratio, which positions assets on top and liabilities on the bottom, ratios
greater than 1.0 are better. If a company's current assets match its current liabilities, the current
asset-to-current-liability ratio is 1. If the ratio is less than one, the firm will be unable to satisfy
its current obligations. A ratio more extensive than one (for example, 2.0) shows that a company
can cover its current expenses. When a ratio is 2.0, the business's current obligations may be
covered by existing assets by a factor of two. If the ratio is 3.0, they may be able to pay their
current obligations three times more, and so on.
Cash Position Indicator:
The cash position indicator assesses a company's capacity to pay its current liabilities. It
represents the percentage of total assets comprising cash and deposits owed to other financial
institutions. The amount of money currently reported on the books of a corporation, investment
fund, or bank is known as its cash position. It represents the company's strength and ability to
pay.
Cash Position Indicator = Cash & deposits due from depository institutions / total assets
Time Series Analysis:

Year 2018 2019 2020 2021 2022

NCC Bank 7.66% 9.57% 9.94% 9.00% 9.87%

One Bank 9.33% 11.12% 12.04% 7.79% 9.48%

The NCC Bank gradually increased from 2018 to 2020 from 9.57% to 9.94% but in 2021 it
decreased and it was 9% but after the pandemic it increased to 9.87% as the bank kept up with
the pace as the world was healing. ONE Bank also face the same situation as NCC Bank it kept
rising from 2019-2020 but dropped in 2021 but again started healing in 2022.
Cross-Sectional Analysis:
We can see that both the bank was growing before the pandemic and during the pandemic they
were affected and the percentage of NCC Bank dropped from 9.94% to 9.00% and the
percentage of ONE Bank dropped from 12.04% to 7.79%. But again we can see that the both
bank faced upward trend in 2022. The higher the ratio the better it is.
In conclusion, if we compare both banks we can see that both banks cash position indicator
increased after the pandemic which means they can pay their current liabilities and its also better
for the shareholders. I would like to say none of them bank is performing well in this field but
comparing both NCC Bank has performed better as they have more cash to meet their daily
operations compared to One Bank. As both the banks have not performed well so the
recommendation would be to increase liquidity by investing in government securities to reduce
the liquidity risk as if there is a liquidity crisis it will be tough for the both the banks to meet
their daily operational expenses.
Liquid securities indicator:
Liquidity ratios, a financial indicator, analyze a debtor's ability to pay off current debt
commitments without raising additional cash. Liquidity ratios analyze a company's ability to
satisfy financial commitments and its margin of safety by utilizing indicators such as the current
ratio, quick ratio, and operating cash flow ratio.
Liquid securities indicator = government securities / total assets.
Time Series Analysis:
 Year 2018 2019 2020 2021 2022

NCC Bank 11.93% 12.74% 13.94% 14.25% 13.69%

One Bank 8.65% 9.56% 8.35% 10.18% 9.21%

Regarding NCC Bank, we can see a growing liquidity security ratio from 2018 to 2019 which
was before the pandemic. In 2020 and 2021, it also increased, which implies a good
performance, but after the pandemic, the percentage dropped to 13.69% in 2022.
On the other hand, we can see the growth of One Bank from 2018 to 2019, which was 8.65% to
9.56%, but it slightly decreased during the pandemic in 2020, which was 8.35%. Again, we can
see that in 2021, during the pandemic, their performance grew, and the ratio was 10.18%, the
highest of all the other years, but after the pandemic, it decreased to 9.21%.
Cross-Sectional Analysis:

NCC Bank stayed comparatively stable over time and One Bank has fluctuated a lot but both
banks faced a downward trend in 2022.
In conclusion, NCC Bank has performed better than One Bank in this section as we have seen
growth in ncc bank despite the covid. NCC Bank relied more on cash and invested less in
securities which is they saw an increase in the liquidity securities indicator also ONE Bank did
the same in 2020 where they invested less in their securities and relied more on cash which is
why ONE Bank saw a sharp increase in 2021. Both the bank should invest in securities and not
rely too much on cash which might create a liquidity crisis.
Capacity ratio:
The capacity ratio is the percentage of total net loans and leases distributed by a bank. If the ratio
is greater, the bank has less liquidity and is more likely to default. Loans and leases offer a
liquidity risk since they are frequently long-term and non-marketable. On the other hand, the
repayment of loans and leases may bring in a lot of money for the bank. A company's capacity
ratio, gauges how much of its assets are utilized, indicates a lack of liquidity since its total assets
are less than its net loans and leases. A loan or lease is the most illiquid asset, and loan
repayment in an unstable economy like Bangladesh needs to be more questionable. As a result, a
more excellent capacity ratio means something other than that the bank is more vulnerable to
producing higher income rather than preserving high-safety cash. The lower it is, the better it is.
Capacity ratio = net loans & leases / total assets.
Time Series Analysis:

Year 2018 2019 2020 2021 2022

NCC Bank 73.08% 70.45% 69.93% 69.63% 70.27%

One Bank 74.74% 72.24% 72.59% 71.74% 71.68%

Here we can see that the capacity ratio of NCC Bank was 73.08% in 2018 which was huge but it
decreased from 2019 to 2021 which is good but in 2021 it slightly increased. In ONE Bank, the
capacity ratio decreased from 2018 to 2022, which is great.
Cross-Sectional Analysis:
Both NCC and ONE Bank faced a downward trend here from 2018 to 2022 and also a stable
situation.
In conclusion, The ratio is dropping, which is positive because both banks are limiting back on
loans and leases to protect themselves from a cash shortage. Despite the fact that One Bank
expects a greater return than NCC Bank. The lower the bank's security position, the higher the
ratio. The trends at both banks were the same, and their values were similar. Additionally, as we
have shown in this scenario for both banks, both institutions should not just focus on illiquid
assets but also on liquid assets.
Profitability Ratio
Profitability ratios are a type of financial indicator that is used to evaluate a company's capacity
to create earnings compared to its sales, operational costs, balance sheet assets, or shareholders'
equity over time, utilizing data from a single point in time. Higher ratios are frequently preferred
over lower ratios, demonstrating effectiveness in turning sales to profit.
Return on equity
ROE is defined as the return on net assets since shareholders' equity equals a company's assets
less its debt. The return on equity (ROI) is defined as the return on the net assets, as a company's
assets less its debt equals its owners' equity. The better a corporation is at transforming equity
capital into profits, the higher its ROE.
Time series analysis:

Years 2018 2019 2020 2021 2022

One Bank 9.69% 9.96% 7.92% 4.76% 8.29%

NCC Bank 10.89% 11.58% 10.96% 11.48% 11.65%

One Bank
a. Before Covid: In the year 2018 & 2019 one bank had a higher ROE. The ROE ratio was
9.69% and 9.96%. It increases yearly.
b. During Covid: In the year 2020 the ROE was 7.92% and in 2021 it was 4.76%. Over the
year the ROE decreased significantly. And the margin was also higher.
c. After Covid: One bank had a good comeback after the covid situation. The ROE
increased 8.29%.

NCC Bank
a. Before Covid: In the year 2018 & 2019 NCC bank had ROE of 10.89% and 11.58%. So,
it increased.
 b. During Covid: During the period of covid in year 2020 it decreased to 10.96% after that
in the year 2021 it again increased to 11.48%. The peak period of covid affected little in
the ROE but it again increased in 2021.
c. After Covid: In 2022, NCC bank had seen a rise in their ROE which is 11.65%

Cross sectional Analysis:

NCC bank has a higher ROE ratio compared to One Bank. Though both saw a decrease ratio in
the covid period, which are 7.29% and 4.76% for One Bank and 10.96% and 11.48% for NCC
bank. But NCC bank managed to keep their ROE higher.
Return on Assets
Return on assets (ROA) is a financial term used to evaluate a company's profitability compared
to its total assets. Corporate management, analysts, and investors can utilize ROA to determine
how successfully a company uses its assets to generate profits. It also indicates if a company's
business plan is asset-intensive or asset-light.
Time series analysis:

Years 2018 2019 2020 2021 2022

One Bank 0.52% 0.53% 0.45% 0.27% 0.49%

NCC Bank 0.80% 0.83% 0.86% 0.90% 0.92%

One Bank
a. Before Covid: The ROA ratio increases in 2018 and 2019 which are 0.52% and 0.53%.
b. During Covid: In the year 2020 the ROA was 0.45% and 2021 it was 0.27%. There was a
fall in ROA. And the margin was also quite high.
 c. After Covid: In 2022, ROA increases to 0.49% still it is less than the before covid period
in the year 2018 and 2019 but One bank increased their ROA after covid situation in
2022.

NCC Bank
a. Before Covid: In 2018 and 2019 their ROA was higher yearly which is 0.80% and 0.83%.
b. During Covid: In the year 2020 and 2021 NCC bank managed to keep their ratio higher.
As we can see in 2020 their ROA was 0.86% and 0.90% in 2021 which is higher from the
before covid situation.
c. After Covid: The ROA ration in 2022 was 0.92%. Overall, we can see that NCC bank has
an increasing ratio throughout the 5 years.

Cross-Sectional Analysis:
Based on the ROA ratio we can see that NCC performed better in both before and after covid
situation. Their ROA increases in last 5 years whereases One bank’s ROA fluctuates in the covid
situation in the year 2020-21 and the ROA were 0.45% and 0.27%. And the ROA also lower
compared to the NCC bank.
Net interest margin
The net interest margin (NIM) compares the net interest revenue generated by a financial
business from credit products such as loans and mortgages to the outgoing interest paid to
holders of savings accounts and certificates of deposit (CDs). The NIM, expressed as a
percentage, is a profitability measure that estimates a bank's or investment firm's long-term
viability. This indicator assists potential investors in deciding whether or not to participate in a
specific financial services organization by offering insight into the profitability of their interest
revenue vs interest costs.
Time series analysis:

years 2018 2019 2020 2021 2022

One Bank 2.53 2 1.8 1.83 2.33

NCC Bank 2.94 2.16 1.96 1.99 2.25

One Bank
a. Before Covid: In 2018 Net Interest Margin was 2.53 and in 2019 the Net Interest Margin
slightly decreased to 2.
b. During Covid: In the year 2020 the Net Interest Margin decreased to 1.8% and then in
2021 it increased to 1.83. Though the net in interest margin was lower than the past two
years but in 2021 it increased.
c. After Covid: The net interest margin for One Bank rises to 2.33 in the year 2022.

NCC Bank
a. Before covid: In 2018 and 2019 the Net interest margin was 2.94 and then it slightly
decreased in 2019 which was 2.16.
b. During Covid: In the year 2020 the net interest margin decreased to 1.96 and in 2021 it
was 1.99. Though it slightly increased in 2021 but from the last two years the ratio was
lower.
c. After Covid: In 2022 NCC bank managed to rise their net interest margin to 2.25.
Cross-sectional Analysis:
If we compare the two banks' performance, though both banks had a lower net interest margin
during the covid period which are 1.8 and 1.83 for one bank and 1.96 and 1.99 for NCC Bank
but if we consider the overall situation NCC bank had performed better in the last 5 years.
Net non-interest margin
Non-interest income is earned by banks and creditors mostly through fees such as deposit and
transaction costs, NSF fees, yearly fees, monthly account service charges, inactivity fees, check
and deposit slip fees, and so on. Credit card companies also levy penalty fees, such as late fees
and over-the-limit fines. Fees that produce non-interest income are charged by institutions to
raise revenue and provide liquidity in the case of rising default rates.

Years 2018 2019 2020 2021 2022

One Bank 0.0086 0.0069 0.0091 0.0095 0.0097

NCC Bank 0.0092 0.0095 0.0011 0.0112 0.0121

One Bank
a. Before Covid: Net non-interest margin was 0.0086 in the year 2018. The it slightly
decreased to 0.0069.
b. During Covid: During the covid period in 2020 the net non-interest margin increases to
0.0091 and in 2021 it increased more to 0.0095.
c. After covid: In the year 2022 the net non-interest margin increased to 0.0097. In the past
5 years the net non-interest margin ratio for one bank has increased.
NCC Bank
 a. Before Covid: In the year 2018 the net non-interest margin rate was 0.0092 which
increased to 0.0095 in the year 20219.
b. During covid: In the year 2020 the net non-interest margin decreased to 0.0011 and in the
next year 2021 it increased to 0.0112. Though it fluctuates in the covid period.
c. After Covid: In the year 2022, the net non-interest margin increased to 0.0121.

Cross Sectional Analysis:

All over, both the banks performance was quite similar. They had seen a lower margin in 2020
which is 0.0091 for one bank and 0.0011 for NCC bank and again they had seen their increasing
margin from 2021 and onwards. The net non-interest margin was 0.0097 in 2022 for one bank
and 0.0121 for NCC bank.
Earnings per share
Earnings per share (EPS) is determined by dividing a company's net income by the number of
outstanding shares of common stock. Net income is the money available to all shareholders after
deducting a company's expenditures and expenses.

Years 2018 2019 2020 2021 2022

One Bank 1.22 1.54 1.4 0.95 1.55

NCC Bank 2.45 2.3 2.12 2.03 2.65

One Bank
a. Before covid: One bank had a fluctuating EPS rate in the 5 years. In 2018, it had EPS
1.22 then it increased with figure 1.54 in 2019.
b. During Covid: In the year 2020 and 2021 it decreased and the figure we can see is 1.4
and 0.95.
c. After Covid: Then in the year 2022 it increased 1.55

NCC bank
a. Before covid: In the year 2018 the EPS was 2.54 and in 2019 the EPS was 2.3. It had a
lower EPS in 2019.
b. During Covid: In 2020, the EPS was 2.12 and then in 2021 the EPS decreased to 2.03.
c. After Covid: In the year 2022 the EPS increased 2.65. Though the eps rate declined in the
covid situation but it managed to increase their eps after pandemic in the year 2022.

Cross-Sectional Analysis:
Both One Bank and NCC bank had seen decrease in EPS during the covid time which are 1.4
and 0.95 for one bank and 2.12 and 2.03 for NCC bank but NCC bank performance was better
because its EPS is higher than One Bank.
Financial Risk
The chance of losing money on an investment or business transaction is referred to as financial
risk. Financial risks may cause both people and organizations to lose cash. Financial hazards
include credit, liquidity, and operational risks, among others. (Verma, 2023).
These are some financial risk ratios:
1. Debt Ratio
2. Debt to Equity Ratio
Debt Ratio:
The concept "debt ratio" refers to a financial ratio that assesses how much leverage a business
has. The ratio of total debt to total assets, represented as a decimal or percentage, is known as the
debt ratio. The percentage of a company's assets that are financed by debt is one way to
understand it.
Total Debt
Debt Ratio =
Total Asset
Time series analysis
Year 2018 2019 2020 2021 2022
One Bank 0.95 0.95 0.94 0.94 0.94
NCC Bank 0.92 0.92 0.92 0.92 0.92

If we look at the table, the numbers remain pretty much stable in the pre pandemic year and post
covid year. The stated numbers show that the increasing debt to asset ratio has essentially not
changed over time. Aside from the worrisome statistic, the fluctuation data were insignificant
and did not cause any concern as it seems stable more or less from 2018 to 2022.

Cross-Sectional Analysis
Between both banks have a pretty well oriented and organized debt situation. More than 90% of
the debt can be covered by asset which portray a positive picture for both the banks. Aside from
the worrisome statistic, the fluctuation data were insignificant and did not cause any concern as it
seems stable more or less from 2018 to 2022.
Debt to Equity Ratio:
The debt-to-equity (D/E) ratio, which measures a company's financial leverage, is determined by
dividing its total liabilities by the value of its shareholders. The D/E ratio is a crucial indicator in
corporate finance. It gauges how much debt a business is using to fund operations as opposed to
using cash on hand. A specific kind of gearing ratio is the debt-to-equity ratio.
Debt to Equity Ratio = (Total Debt)/ (Total Equity)
Time series analysis
Year 2018 2019 2020 2021 2022
One Bank 17.49 17.56 16.91 16.76 16.13

NCC Bank 12.58 10.70 11.36 13.16 12.10

One bank's D/E ratio was 17.49 in 2018, and it decrease to 16.76 in 2020 and then it is pretty
much same till 2022. On the othe hand NCC bank go through up and down. In 2018 it was 12.58
and in 2019 it decreases to 10.70, next two year it go up and end up 12.10 in 2022.
Cross-Sectional Analysis

If we look these two banks, NCC bank's ratio decrease in pandamic year to 10.70 means at that
time bank maintain it D/E ratio well. and in 2021 and 2022 it is going back to their regular
conditions.
On the contrary one banks' debt to equity ratio was decrease by around 1%, 17.49 to 16.13,
which means bank is doing well over time to maintained it D/E ratio.
Market position
Market position can be used to evaluate a company's financial standing and to analyze whether a
stock is properly valued, overpriced, or underpriced. The most popular market value ratios,
though there are others, are the price-earnings, market-to-book, and dividend-per-share ratios.
Using market value ratios, management can learn how banks and other investors see the
company's performance.
Price earnings Ratio
A financial indicator used to evaluate a publicly listed company's valuation is the price earnings
ratio (P/E ratio). It is calculated by It is calculated by market price per share of common stock by
its earnings per share (EPS). by its earnings per share (EPS). Investors may learn how much they
are prepared to pay for each dollar of a company's profits by looking at the P/E ratio. A high P/E
ratio shows that investors have high expectations for future growth and are prepared to pay more
for the company, whereas a low P/E ratio may reflect that investors have low expectations for
future growth or that the stock is undervalued. In order to draw meaningful conclusions, it is
crucial to compare P/E ratios within the same sector or industry.
𝐌𝐚𝐫𝐤𝐞𝐭 𝐩𝐫𝐢𝐜𝐞 𝐩𝐞𝐫 𝐬𝐡𝐚𝐫𝐞 𝐨𝐟 𝐜𝐨𝐦𝐦𝐨𝐧 𝐬𝐭𝐨𝐜𝐤
Price Earnings Ratio =
𝐄𝐚𝐫𝐧𝐢𝐧𝐠𝐬 𝐩𝐞𝐫 𝐬𝐡𝐚𝐫𝐞
Time series analysis:
Years 2018 2019 2020 2021 2022

One Bank 10.14 7.93 5.98 6.24 7.18

NCC Bank 7.73 5.22 5.59 6.22 5.61

One Bank
In this graph, we can see the price earnings ratio of One bank has been increase in 2018.Before
the pandemic in 2018 the price earnings ratio was 10.14. In 2019 the price earnings ratio was
7.93. In 2020, when covid pandemic hit the ratio became 5.98 and in 2021 it was 6.24. After the
pandemic in 2022 the ratio was 7.18.

d. Before Covid-19: In the year 2018 & 2019 one bank had a higher price earnings ratio.
The ROE ratio was 10.14 and 7.93
e. During Covid-19 In the year 2020 the price earnings ratio was 5.89 and in 2021 it was
6.24 Over the year the price earnings ratio decreased significantly.
f. After Covid-19: One bank had a good comeback after the covid situation. The price
earnings ratio increased 7.18.
NCC Bank
We also can see the price earnings ratio for NCC bank has declining before pandemic from 2018
to 2019 and it was 7.73 to 5.22. It grew to 5.59 times in 2020 and to 6.22 times in 2021.But after
the pandemic in 2022 it again declines to 5.61.

d. Before Covid-19: In the year 2018 & 2019 NCC bank had price earnings ratio of 7.73
and 5.22 So, it decreased.
e. During Covid-19: During the period of covid in year 2020 it increased to 5.59 after that
in the year 2021 it again increased to 6.22 The peak period of covid affected little in the
price earnings ratio but it again increased in 2021.
f. After Covid-19: In 2022, NCC bank had seen a fall in their price earnings ratio which is
5.61.
Cross section analysis:

We can see One bank price earnings ratio is higher than NCC bank from 2018 to 2022.But even
after the pandemic the price earnings ratio kept on growing whereas NCC bank was unstable to
stabilize their situation and faced sufficient decline in their price earnings ratio.
Market to Book value ratio

The Market to Book value ratio is a financial metric used to assess the relationship between a
company's market value and its book value. It is calculated by the market price per share of
common stock by the book value per share of common stock. The market value represents the
current market perception of a company's worth, while the book value represents the value of a
company's assets minus its liabilities as recorded in its financial statements. The ratio provides
insights into how the market values a company's assets relative to their accounting value,
indicating whether the market perceives the company's assets as undervalued or overvalued.
 Market price per share of common stock
Market to Book value ratio = Book Value per share of common stock

Time series analysis

Years 2018 2019 2020 2021 2022

One Bank 1.01 0.84 0.48 0.27 0.55

NCC Bank 0.89 1.02 1.14 1.26 1.38

One Bank: In this graph, we can see the market to book value ratio of One bank has decease in
2018 to 2021. The market to book value ratio fell significantly from 1.01 to 0.27. After the
pandemic in 2022, the market to book value ratio increased by 0.55. Since this ratio is related to
shareholder wealth
One
.
a. Before covid-19 -The market to book value ratio of One Bank was relatively stable
before the COVID-19 pandemic however, the ratio fell by 0.13.

b. During COVID-19 -The market to book value ratio of One Bank continued to fall
consistently. Despite the hardships of covid -19 pandemic

c. After the COVID-19 After the COVID-19 phase the market to book value ratio
increased. It was 0.55.

.
NCC bank: In the graph we can see that the market to book value ratio for NCC Bank increases
over the years despite the COVID-19 phase in between. The market to book value ratio starts at
an alarming figure, which is 0.89 in 2019. However, the ratio jumps to 1.38 in 2022 which is
above the industry average and hence shows that NCC bank has drastically improved overtime.

a. Before the COVID-19: NCC Bank's market to book value ratio was relatively low,
which was 0.89 in 2018. Fortunately, the ratio improves to 1.02 in 2019.
b. During COVID-19 : Despite the challenges of covid -19 pandemic, the market to book
value ratio of NCC banks continued to rise from 1.14 to 1.26 which is above industry
average.
c. After the COVID-19 pandemic (2022): After the pandemic, the market to book value
ratio of NCC Bank still continued to rise. The market to book value ratio of NCC bank
was at their highest at 1.38 in 2022.
Cross Section Analysis:
In 2018, One bank market to book value ratio, which is 1.01 is relatively higher than that of NCC
bank’s market to book value ratio which is 0.89. However. The market to book value ratio of fall
whereas the market to book value ratio of NCC bank continued rise intensely. In 2022, NCC
bank had a relatively higher market to book value ratio of 1.38 and One bank market to book
value ratio of 0.55. This shows that NCC bank has better performance at managing their
shareholder wealth than One bank
Dividend Per share
Dividend per share refers to the distribution of a company's earnings or profits among its
shareholders on a per-share basis. It represents the portion of the company's earnings allocated to
each outstanding share of stock. This distribution is typically made in the form of dividends,
which are payments made by the company to its shareholders as a reward for their investment.
Dividends per share can vary based on the company's profitability, dividend policy, and the
number of outstanding shares. Shareholders often consider the dividend per share as an indicator
of a company's financial health and profitability.
𝐃𝐢𝐯𝐢𝐝𝐞𝐧𝐝 𝐩𝐚𝐢𝐝
Dividend Per share =
𝐓𝐨𝐭𝐚𝐥 𝐧𝐮𝐦𝐛𝐞𝐫 𝐨𝐟 𝐜𝐨𝐦𝐦𝐨𝐧 𝐬𝐡𝐚𝐫𝐞𝐬 𝐨𝐮𝐭𝐬𝐭𝐚𝐧𝐝𝐢𝐧𝐠

Time series analysis

Years 2018 2019 2020 2021 2022

One Bank 1.23 0.78 0.71 0.65 0.91

NCC Bank 1 1.7 1.5 1.6 1.5

One Bank -In this graph, we can see that before the pandemic in 2018 the dividend per share
was 1.23. In2019 the dividend per share was 0.78. However, in 2019 their divided decrease. In
2020, when covid pandemic hit the ratio became 0.71 and in 2021 it was 0.65. The dividend per
share of One bank continues decreased consistently. After the pandemic in 2022 the ratio was
0.91. This period the dividend per share rose. Despite their increase in dividend per share, One
bank should manage their profit to increase their cash dividends payment to their shareholder’s.

a. Before covid-19 The dividend per share of One bank was 1.23 in 2018. However, in
2019, the dividend per share of One bank was 0.78

b. During COVID-19 The dividend per share of One bank continued to rise
consistently at a slower rate. Despite the hardships of covid -19 pandemic, One bank still
had managed to give dividends even at a lower value. In 2020 and 2021 the dividend per
share of One bank was 0.71 and 0.65

c. After the COVID-19 After the COVID-19 phase the dividend per share rose to 0.91.
Despite their increase in dividend per share, one bank should manage their profits to
increase their cash dividends payment to their shareholders

NCC bank: In the graph we can see that the dividend per share for NCC Bank increases over
the years despite the COVID-19 phase in between. The dividend per share starts at 1, which
means for every share the investors received 1 cash dividend. In the following years, NCC bank
experiences both rise and fall in their dividend per share values. In 2022, their dividend per share
was 1.5, which is lower than the previous year’s dividend per share of 1.6.

a. Before covid-19 The dividend per share of NCC bank was 1 in 2018 and rose to 1.7
in 2019, which was the highest dividend per share recorded before the COVID-19
pandemic.

b. During COVID-19 The dividend per share of NCC bank fell to 1.5 in 2020 however,
slightly rose to 1.6 in the next year.

c. After the COVID-19 After the COVID-19 phase the dividend per share of NCC
bank fell to 1.5 again. This means they could give less cash dividends to their
shareholders than the previous year.
Cross section analysis:
The dividend per share of NCC bank was significantly better than that of One bank dividend per
share in every year 2019 to 2022. The dividend per share of NCC bank was 1 whereas One
bank’s dividend per share was 1.23. This year one bank is better than NCC bank. Additionally,
NCC Bank's dividend per share in 2022 was 1.5, which is obviously higher than One Bank's
dividend per share. In conclusion, compared to One bank, NCC bank is able to pay out more
cash dividends for each share owned.
Efficiency Ratio
The efficiency ratio is a financial indicator used to evaluate a company's operational
effectiveness and performance. It assesses how well a business' activities produce profits in
relation to its costs. Depending on the sector and accounting procedures used, running costs such
as staff pay, rent, utilities, marketing expenditures, and other overhead may be taken into
consideration.
Operating Efficiency
The operational ratio shows how well a company's management is performing by comparing
operating costs to net operating revenue. The company's ability to turn a profit increase as the
ratio falls. Investors should be aware that while using this ratio, it does not take debt repayment
or growth into account. Banks strive for lower efficiency ratios since they demonstrate that they
produce more money than they spend. As a general rule, the optimal efficiency ratio is thought to
be 50%.
Operating 2018 2019 2020 2021 2022
Efficiency Ratio
NCC BANK 0.74 0.77 1.13 0.90 1.14
ONE BANK 0.77 0.97 1.49 1.20 1.41
Time Series Analysis:
NCC BANK: We can observe from the graph that from 2018 to 2022, the operational efficiency
ratio fluctuates between increases and decreases. Their operating efficiency ratio was 0.74 in
2018 and increased to about 0.4 by the end of 2022, which demonstrates inadequate spending
management.
a. Before Covid-19 (2018-2019): The operating efficiency ratio of NCC Bank was 0.74 in
2018 and marginally increased to 0.03 in 2019, which might indicate a little increase in
their expenditures.
b. During Covid-19 (2020-2021): NCC's operational efficiency ratio increased to 1.13 in
2020 but significantly decreased to 0.90 the following year. This decrease in costs might
also be the result of layoffs.
c. After the COVID-19 pandemic (2022): Bank increased to 1.14 following the COVID-
19 phase. As previously indicated, this considerable growth in the ratio translates to an
increase in their costs, such as a higher allowance for loan losses, etc.

ONE BANK: We can observe from the graph that from 2018 to 2022, the operational efficiency
ratio fluctuates between increases and decreases. Their operating efficiency ratio was 0.77 in
2018 and increased to about 0.64 by the end of 2022, which demonstrates inadequate spending
management.
a. Before Covid-19 (2018-2019): The operating efficiency ratio of ONE Bank was 0.77 in
2018 and marginally increased to 0.20 in 2019, which might indicate a little increase in
their expenditures.
b. During Covid-19 (2020-2021): ONE's operational efficiency ratio increased to 1.49 in
2020 but significantly decreased to 1.20 the following year. This decrease in costs might
also be the result of layoffs.
 c. After the COVID-19 pandemic (2022): Bank increased to 1.41 following the COVID-
19 phase. As previously indicated, this considerable growth in the ratio translates to an
increase in their costs, such as a higher allowance for loan losses, etc.

Cross-Sectional Analysis:
Beginning in 2018, NCC Bank's operational efficiency ratio was 0.74, lower than ONE Bank's
operating efficiency ratio of 0.77. Even though NCC bank had a lower operating efficiency ratio,
ONE bank appeared to manage its costs more effectively in the years that followed. Even though
NCC bank had a slightly lower operating efficiency ratio than AB bank (ONE bank had an
operating efficiency ratio of 1,41 and NCC bank had an operating efficiency ratio of 1.14), at the
end of 2022, we can see that the difference between the operating efficiency ratios of the two
banks had significantly decreased, indicating that ONE bank had more effective control over
their expenses than NCC bank.

Employee Productivity
Productivity is the amount of a good or service a worker handles in a certain amount of time. A
worker cooking hamburger might make 20 of them in an hour, but a worker serving 15
customers at a coffee shop would. Simple productivity is neither good nor bad, and in service
industries, it may vary based on factors outside the control of the employee, including the
number of customers in need of service. Productivity is the fundamental measure of an
employee's output. It helps determine the employee productivity of a bank by measuring the
amount of money that each employee generates.
Employee 2018 2019 2020 2021 2022
Productivity
Ratio
NCC BANK 1.2 1.38 1.64 1.81 1.25
ONE BANK 1.33 2.92 2.92 2.69 1.34
Time Series Analysis:
NCC BANK: The graph shows that in 2018, at 1.2, the NCC employee productivity ratio
reached its lowest level for the period of 2018–2022. The staff productivity ratio rises, although
at a slower rate, reaching a maximum of 1.81 in 2021 before declining to 1.25 in 2022.
a. Before covid-19 (2018-2019): The Employee productivity ratio of NCC Bank increased
from 1.2 in 2018 to 1.38 in 2019, which might indicate an increase in profitability.
b. During COVID-19 (2020–2021): NCC's staff productivity ratio rose, reaching 1.64 in
2020 and 1.81 in 2021. This might indicate a decrease in the anticipated number of
layoffs during the epidemic.
c. After COVID-19(2022): The employee productivity ratio of NCC Bank dropped to 1.25
after the COVID-19 phase. Due to challenges in the post-pandemic era, this drastic
decrease in the ratio might indicate a decline in their earnings.

ONE BANK: The graph shows that ONE Bank's Employee productivity ratio has increased
substantially through 2022. The employee productivity ratio will, however, start to drop in 2022.
The employee productivity ratio was 1.33 in 2018 and dropped to 1.34 in 2022, representing a
relatively little gain in the ratio thus far, despite a considerable increase in the ratio between the
two years.
a. Before Covid-19 (2018-2019): The ONE Bank's Employee productivity ratio was 1.33 in
2018 and aggressively increased to 2.92 in 2019. This demonstrates an increase in ONE
Bank’s profitability.
b. During Covid-19 (2020-2021): The ONE Bank's Employee productivity ratio stayed
constant in 2020, despite the challenging conditions brought on by the pandemic.
Between 2018 and 2022, the employee productivity ratio was at its highest point. The
 Employee productivity ratio, however, dropped to 2.69 in 2021, indicating a decline in
profitability as well.
c. After Covid-19 (2022): Since they suffered a loss in 2022, the employee productivity
ratio substantially decreased after the COVID-19 phase, falling to 1.34. This
demonstrates that One Bank should focus more on controlling its costs and workforce in
order to boost earnings.
Cross-Sectional Analysis:
When comparing the two banks in 2018, NCC Bank had an employee productivity ratio of 1.2
and ONE Bank had a substantially better employee productivity ratio of 1.33. Moreover, from
2018 to 2022, ONE Bank consistently outperformed NCC Bank in terms of employee
productivity ratio. Despite ONE bank's loss in 2022, its employee productivity ratio in that year
was 1.34, higher than NCC bank's employee productivity ratio of 1.25.

Credit Rating
A credit rating is a determination of a person's or an organization's creditworthiness or financial
soundness. It is often given by a credit rating organization and entails determining the borrower's
capacity and desire to make timely payments on their loans. Credit ratings are typically
expressed as a letter grade or score, such as AAA, AA, A, B, C, or D, where AAA is the highest
rating and D is the lowest. For investors, lenders, and other financial institutions to evaluate the
risk involved with disbursing funds or making investments in a company, these ratings are
crucial. Credit ratings are essential in the financial sector because they give lenders and investors
important information about a person's, a business's, or a nation's creditworthiness.

NCC Bank credit rating analysis

In 2018, NCC Bank received ratings from the External Credit Assessment Institutions (ECAIs)
of ST-1 for the short term and AA for the long term. The most significant level of payment
assurance is known as "ST-1." Access to alternative finance sources and short-term liquidity,
including internal capital creation, are both very good. Nearly as risk-free as immediate
government responsibilities are safety.
In the long term, NCC Bank was rated AA, which is adjusted to be high quality, provide better
safety, and have good credit quality. For the years 2018–2022, the NCC bank's credit rating
remained stable.
One bank credit rating analysis
One bank received an AA rating over the long term, demonstrating a strong ability to satisfy
financial obligations and a general ability to adjust to adverse changes in business, economic,
and other external situations. These organizations often have a solid track record and no obvious
shortcomings.
They fall into the ST-2 short-term group, which implies they have the financial capacity to pay
their obligations but are relatively vulnerable to unfavorable changes in the commercial,
economic, and other external factors.
Cross sectional analysis
In terms of both short-term and long-term credit ratings, NCC Bank and One Bank are both
stable. Both NCC Bank and One Bank have stronger credit ratings than the other. NCC Bank's
short-term credit rating is ST-1, whereas One Bank's is ST-2, indicating that NCC Bank has a
lower credit risk than One Bank. There are several credit rating organizations, and there are
numerous credit rating scales to choose from.

Capital Adequacy Ratio:

The capital adequacy ratio (CAR), which is assessed as a proportion of a bank's risk-weighted
credit exposure, is a measure of a bank's capital (Hayes, 2022). To put it another way, the
BASEL agreement terms require that the bank modify its liabilities to reflect potential risk
exposures stated as percentages. This allows for the measurement of the Tier 1 and Tier 2 capital
that the bank retains for itself. The BASEL III criteria, which Bangladesh Bank now abides with,
stipulate that the CAR must be maintained at a minimum of 10.5%. CAR is used to determine if
a bank has sufficient capital to withstand a specific level of loss before facing bankruptcy or
insolvency (Beers, 2021).
Time Series Analysis:

One Bank
 a. Before Covid-19: The capacity adequacy ratio was 11.62% in the year 2018.In 2019, the
capacity adequacy ratio was12.80%
b. During Covid-19: During the covid period in 2020 the net non-interest margin increases
to 13.02% and in 2021 it decreased to 12.03%
c. After covid-19: In the year 2022 the net non-interest margin increased to 11.77%. In the
past 5 years the net non-interest margin ratio for one bank has increased.
NCC Bank: We can see the capital adequacy ratio of NCC bank in 2018 is 12.62% & in 2019-
2020 the ratio increases significantly which is respectively 13.41% & 13.21%. On the other
hand, in 2021 this ratio was becoming so high which is 15.86% then again in 2022 this ratio
decreased (14.86%). After analyzing the Capital Adequacy ratio based on Before, during & after
COVID-19 situation we will get the following

a. Before COVID-19 Before COVID-19 CAR ratio was little in 2018-2019.

b. During COVID-19 During COVID-19 period the CAR ratio becomes high compared to
the before covid.

c. After COVID-19: It is seen that after the COVID period the CAR ratio of NCC Bank
decreased.

Cross-Sectional Analysis:
Both bank had upward trend from 2018 to 2022 but from 2021 ONE Bank’s CAR dropped.
In conclusion, Both banks met the minimum capital adequacy ratio requirements. This shows
that NCC Bank and One Bank have enough capital to avoid going bankrupt and losing depositor
money after suffering a decent amount of losses. In a comparison of the two banks, NCC Bank
obviously surpasses the other, although the other bank was still growing over time, while NCC
Bank had a superior capital adequacy ratio. NCC Bank's CAR has steadied at a higher level.
They can thus absorb larger losses before filing for bankruptcy. They are the most dependable to
their consumers as a consequence, which increases their revenues.

Conclusion
Bank financial statements are a little bit different from those of other organizations. The ratios
that a bank uses to assess, analyses, analyze, and contrast its performance with those of other
banks are likewise clearly divided. Conventional ratios are not used here. In general, calculating
ratios is a pretty simple operation because the income statement and balance sheet include all of
the numbers. The numbers are occasionally not stated explicitly. On the basis of our findings, it
is quite difficult to forecast the future of NCC Bank and One Bank. using effectiveness, the fact
that NCC is outperforming one bank shows that the bank is far more efficient and successful at
controlling costs. If we use liquidity as the benchmark, then ncc bank is outperforming One
Bank. Because NCC has more liquid assets than One Bank and has more government securities
than One Bank. But it also shows that the NCC is not making good use of its resources. Based on
profitability, ncc is doing well, outperforming one bank in terms of profit. NCC Bank is
performing better than one bank overall because NCC Bank is superior to one bank in the
majority of the sectors.
References

Beers, B. (2021, May 29). What Does a High Capital Adequacy Ratio Indicate? Retrieved from

Investopedia:https://www.investopedia.com/ask/answers/040115/what-does-it-meanwhen-

company-has-high-capital-adequacyratio.asp#:~:text=The%20capital%20adequacy

%20ratio%20(CAR)%20is%20a%20measure%20of%20how,at%20risk%20for

%20becoming%20insolvent.

Hayes, A. (2022, April 5). What the Capital Adequacy Ratio (CAR) Measures With Formula.

Retrieved from Investopedia: investopedia.com/terms/c/capitaladequacyratio.asp

Limited, N. B. (n.d.). NCC Bank Limited::.. . https://www.nccbank.com.bd/

One Bank Ltd.. (n.d.). https://www.onebank.com.bd/home/about-obl/obl-profile/

Investopedia. (n.d.). Investopedia. https://www.investopedia.com/

Investopedia. (n.d.). Investopedia. https://www.investopedia.com/terms/c/creditrating.asp
Price to Earnings (P/E) Ratio. (n.d.). Scripbox. https://scripbox.com/pf/price-to-earnings-ratio/
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