FINANCIAL

ANALYSIS OF
COMPANIES IN
THE BANKING
SECTOR
ICICI BANK, YES BANK AND BANK OF
BARODA

SECTION C, GROUP 2:
ANKIT RJA (14P128)
ARUSHI JAIN (14P133)

HARNOOR SINGH LAMBA (14P141)

PRATHIHASTH REKABU (14P155)
SHASHANK (14P167)
SUNANDINI GUPTA (14P174)

Objectives
The objective of the project is to analyze three players in the banking industry in
India, namely:

ICICI Bank:
ICICI Bank is an Indian multinational banking and financial services company
headquartered in Vadodara. It is India's largest private sector bank with total assets
of Rs. 5,946.42 billion (US$ 99 billion) at March 31, 2014 and profit after tax Rs.
98.10 billion (US$ 1,637 million) for the year ended March 31, 2014. The Bank has a
network of 3,800 branches and 11,162 ATMs in India, and has a presence in 19
countries.

Yes Bank:
YES BANK is a private bank in India with headquarters in Mumbai. It was founded in
2004 by promoters Ashok Kapur and Rana Kapoor, which had a collective
shareholding of 29%. It is now Indias fourth largest private sector Bank. It has a
widespread branch network of over 572 branches across 375 cities, with 1170+
ATMs and 2 National Operating Centers in Mumbai and Gurgaon. In 2010, the bank
announced the roll-out of a strategic blueprint, named Version 2.0 of the bank, to
further accelerate its business growth in the retail banking space, with the objective
to achieve by 2015, a balance sheet size of INR 1,500 billion.

Bank of Baroda:
Bank of Baroda (BoB) is an Indian state-owned banking and financial services
company headquartered in Vadodara. It is the second-largest bank in India, after
State Bank of India. Based on 2012 data, it is ranked 715 on Forbes Global 2000 list.
BoB has total assets in excess of INR 3.58 trillion, a network of 4464 branches in
India, and over 2000 ATMs.

Analysis Objectives
These three banks would be gauged to take decisions on the following fronts:
1.
2.
3.
4.
5.

Short Term Investment

Short Term Lending
Long Term Investment
Long Term Lending
Strategic Decision

Introduction
Banking
The Banking sector is one of the most important sectors of the Indian economy.
Given the ability of the banking sector to affect the economy, this sector is one of
the most regulated sectors in India. The main regulatory body is Reserve Bank of
India (RBI). A strong and viable banking industry is extremely necessary for
economic progress while a weak banking sector is a cause for problems in the
economy. Banking is used for policy transmissions and for sustaining economic
growth.

Outlook of the Sector

RBI Policy
1. With RBI committed to bring the CPI inflation down to 8% by January 2015
and to 6% by January 2016, banks are unlikely to see much increase in
money supply with them and key rates are most likely to remain unchanged.
2. Recently RBI has restructured the LAF window with greater reliance on term
repos (.75% of NDTL compared to 0.25% of NDTL through overnight repo) to
encourage the existence of a term structure for these rates. This term
structure would be a better guidance of the liquidity supply in the economy.
3. With the introduction of a portion of counter cyclical buffer and liquidity
coverage ratio as part of BASEL III implementation process, the reserves
available with the bank will decrease. However, to offset this, RBI has relaxed
certain restrictions on BASEL bonds such as tier I bonds are now open to retail
investors as well and tier II bond can be issued as a perpetual bond as well.
Moreover government has allocated INR 11,200 crore as infusion of capital in
public sector banks.
4. Differentiated licensing will give a boost to financial inclusion as more people,
especially in the rural areas will be connected to the financial system by
means of payment banks, post offices, etc. Concentration ratios in the rural

areas will increase as public sector banks and established NBFCs will face
more competition from the entry of these small banks.
5. Recent debt restructuring policies will enable the banks in tackling wilful
defaulters better; meanwhile also better manage the high NPA levels present
especially in public banks.
6. The new interest cap announced by RBI would positively impact smaller
NBFCs as they can now borrow at a higher interest rate compared to
relatively larger NBFCs.
Government
1. Aggressive financial inclusion plan of the government through Jan Dhan
Yojana will help the banks by providing them with future funds at a low cost.
These accounts also contain an overdraft facility which could boost future
interest income of these banks.
2. In its maiden budget, the new government has laid an emphasis on
infrastructure projects and provided regulatory freedom for banks to invest in
infrastructure bonds which would lead to better interest margins for these
banks.
3. With the government mooting consolidation of public banks, concentration
ratios in the banking sector could see a significant change and if achieved
efficiently could boost the profitability of these banks.
4. Increase in FDI limits to 49% in the insurance sector is going to bring the
much needed long term capital to Indian insurance companies which could
lead to these companies tapping the true potential of Indian insurance
industry.
Other Events
1. Public sector banks are witnessing high NPA levels, with maximum NPA visible
in agricultural credit (close to 4.4% in FY 14). Below average monsoon, which
has a very high probability could lead to increase in NPAs in this credit
segment.
2. Any breakout of ISIS crisis in southern parts of Iraq or escalation of Ukraine
crisis could lead to increase in crude oil prices and thus could lead to
inflationary situation in the economy.
3. Growth in US economy or any signs of increase in interest rates in the US
Treasury market, would lead to another round of flight of capital like the one
that the country witnessed in 2013, leading to current account problems and
currency depreciation. However, the boost given to investor confidence due
to the new government will lead to inflow of capital and would negate any
such outflow of capital.
4. Revivial in economy would lead to higher levels of disposable incomes and
more appetite among consumers to borrow, which would lead to retail credit
growth for the banks while growth in IIP figues for the last quarter and higher
industrial confidence, which is visible with higher levels of HSBC PMI index,
would lead to rise in industrial credit as well.

Public Banks
Public banks are majorly concerned with problems of higher levels of NPAs and
implementation of BASEL III norms. Moreover a bad monsoon could aggravate the
already high NPAs in the agriculture credit segment. However government support
in terms of budgetary capital allocation and benefits of financial inclusion will be
reaped by these banks in the near future. The sector is also expected to witness
activity with respect to consolidation of banks especially SBI with one or two of its
associates. Government could also liquidate its shareholding in the some of the
banks, which would fund their capital infusion in these banks without putting
pressue on the fiscal situation of the government.

Private Banks
Compared to PSU banks, private sector banks are better placed with strong growth
in credit, CASA accounts, higher margins and higher asset quality (i.e. lesser NPA).
Moreover most of the private banks are better equipped to implement the BASEL III
capital requirements. All these banks are mainly concentrated in urban and semiurban centres so protecting them from exposure to the agriculture sector. Leaving
aside Kotak Mahindra Bank, most of the banks in this segment are valued with P/E
ratio less than 15 and P/B ratio close 2.5. Estimated growth for these banks is high,
indicating opportunities in these banks.

Recent Developments in Banking Sector

Asset Quality
The credit quality of banks has deteriorated significantly in the past three years.
Gross NPAs increased from 2.4 % of gross advances in March 2011 to 4.1 % in
March 2014. Net NPAs showed similar trends and were 2.2 % of net advances in
March 2014.
Both Public Sector Banks and Foreign Banks have seen this deterioration, while
Private Sector Banks have been able to relatively resist it, with their gross NPA
ratio improving from 2.5 % to 1.9 % and net NPA ratio showing only a slight
increase.
This increase in non-performing assets has mainly happened due to slowdown in
the domestic economy since the global recession, causing strain on a number of
companies and projects.
Non-priority sector has contributed more to the problem, accounting for 64 % of
the total gross NPAs at the end of March 2014, up from 60 % at end-March 2013.
About 36 per cent of the overall bad assets in the system have been created by
six sectors of the economy infrastructure, metals, textiles, chemicals,
engineering and mining. However, these sectors have only 30 per cent of the
credit share
Industrial sector was the single largest contributor, accounting for over 58 % of
the gross NPAs of the banks at end-March 2014.
Retail credit has shown improvement in gross NPA ratio from 2.3 % to 2 % in the
year 2013-14.

How does bad asset quality affect a bank?

Profitability
Higher NPAs imply lower income from the assets of the bank. This has to be
accompanied by the higher provisioning requirements, adding to the cost and thus
reducing the profits of the banks. This adversely affects the NIM and ROE of the
banks.
The profitability of bank decreases not only by the amount of NPAs, but the
opportunity cost of these assets also affects the profitability. This is to say that if the
banks were able to invest the amount equal to the NPAs in some other return
earning project/asset, they could earn profits. But since the funds are blocked with
the borrowers, banks cannot park these funds anywhere else. So NPAs not only
affect current profit but also future stream of profit, which may lead to loss of some
long-term beneficial opportunity.
Liquidity
Money gets blocked; decreased profit leads to lack of enough cash at hand which
leads to borrowing money for shortest period of time which leads to an additional
cost to the company. Difficulty in operating the functions of a bank due to lack of
money is another impact of NPAs.
Involvement of management
Time and efforts of management is another indirect cost which bank has to bear
due to NPAs. Time and efforts of management in handling and managing NPAs
would have diverted to some fruitful activities, which would have given good
returns. Nowadays banks have special employees to deal and handle NPAs, which is
an additional cost to the bank.
Public Sentiment
There is a definite loss of faith associated with the NPA numbers rising and this
cannot be compensated by larger profits.
To overcome the problem of deteriorating asset quality, several steps have
been taken by RBI
Recognition of NPAs:
RBI, in its circular dated February 26, 2014, gave the guidelines regarding
recognition of financial stress by the banks. According to the guidelines, before a
loan account turns into a NPA, banks are required to identify incipient stress in the
account by creating three sub-categories under the Special Mention Account (SMA)
category as given in the table below:

SMA Subcategories

Basis for classification

SMA-0

Principal or interest payment not overdue for more

than 30 days but account showing signs of incipient
stress

SMA-1

Principal or interest payment overdue between 3160 days

SMA-2

Principal or interest payment overdue between 6190 days

On identifying SMAs, banks need to report such SMA status of borrowers who have
an aggregate fund and non-fund based exposure of INR 50 million and above to
Central Repository of Information on Large Credits (CRILC). On failure to do so,
banks will be subjected to accelerated provisioning for these accounts, which means
bank have to make much larger provisions for these assets at an early period. RBI
also prescribes formation of a Joint Lenders Forum (JLF) and adoption of a
Corrective Action Plan (CAP) which includes rectification, restructuring and recovery
to deal with NPAs.
Asset Reconstruction Companies:
ARCs are governed by the Securitization and Reconstruction of Financial Assets and
Enforcement of Security Interest Act, 2002 (SARFAESI Act).
ARCs are specialized entities for recovery and liquidation of assets. Banks and
financial institutions which want to clear the stressed assets off their balance sheets
may divest their assets with an ARC. ARCs acquire these assets at a discount and
make recovery from the borrowers directly. They are also permitted to acquire debt
from other ARCs subject to certain conditions. Qualified Institutional Buyers (QIBs)
are the main source of funding for ARCs. As part of the restructuring process,
borrowers are either given more time to pay back money or given loans at softer
interest rates to nurse them back into health. At present, there are 14 ARCs
operating in India.
In August 2014, RBI came up with tightened norms for these companies to improve
discipline and bring about transparency in the sale and purchase of bad loans. As
per the norms, ARCs are now required to pay upfront 15% of the bid value of NPAs.
This payment was limited to 5% earlier. Also, ARCs will get at least 2 weeks to carry
out due diligence before bidding for the stressed assets. The companies are
expected to plan the recovery from the acquired NPAs within 6 months and report
about the wilful defaulters to the Joint Lenders Forum (JLF) for stressed assets at
quarterly intervals.
The government increased the FDI limit in ARCs from 49% to 74% and further to
100% last year. This will bring the much needed capital and foreign expertise in this
segment. However, RBI rules stipulate that a single entity cannot hold more than 49
per cent stake, which acts as a hindrance in attracting foreign capital. Government
is also considering setting up a National Asset Management Company that would
act as a nodal agency for acquiring NPAs from the banks and recovering them as
well as helping the sick banks revive and grow. Currently, only partial takeover of
large assets is done by the ARCs. The NAMCO will enable banks to sell of large
stressed assets completely.
Corporate Debt Restructuring (CDR)
CDR is a framework to ensure timely and transparent mechanism for restructuring
the corporate debts of viable entities facing financial difficulties. It is a tool to offer
aid to borrowers in distress, owing to circumstances beyond the borrowers control
such as a general downturn in the economy or a sector. It might also be warranted

by legal or other issues that cause delays, particularly in cases of project

implementation. CDR has the dual objective of revival of distressed corporates and
safety of the money lent by the bank and financial institutions.
Restructuring may involve providing extended moratorium, spreading the
obligations over a longer period of time, converting part of the debt into equity or
preference capital etc., reducing the interest rate, making payments out of
promoters contribution/ sale of surplus assets etc.
Restructured advances for all scheduled commercial banks increased from 2.5 per
cent of gross advances in June 2011 to 5.9 per cent in March 2014. PSBs accounted
for 92% of such restructuring. This reflects potential hidden stress in the quality of
loan assets. To counter this, RBI made debt restructuring norms more stringent.
According to the new rules, promoter's contribution has been raised to 20% (from
15%) of the sacrifice made by lenders or 2% of the restructured loan, whichever is
higher. This money has to be paid up front. Also, from June 2013, the provisioning
requirement for fresh restructured loans was increased to 3.5 per cent from2.75 per
cent. These requirements will further be increased to 5 per cent by March 2016. To
discourage banks from liberally restructuring loans, RBI has said that from April
2015 an account will have to be classified as sub-standard as soon as it is
restructured. However, for new projects RBI has relaxed the condition, under which
a loan has to be categorized as a restructured asset. Earlier, banks had to
restructure loans if the date of commencement of commercial operation is delayed
by six months. The new regulations extended this to one year. Till then, the loan will
be treated as a standard asset. By June 2014, CDR Cell had approved 486 cases of
restructuring, which aggregated to Rs. 348502 crores. Another 20 cases were still
under consideration for approval.
Debt Recovery Tribunals
A total of 6 new Debt Recovery Tribunals will be set up by the government, as
declared in the Union Budget 2014-15. Till now, the Government of India has
constituted thirty three Debts Recovery Tribunals and five Debts Recovery Appellate
Tribunals across the country. They are responsible for enforcing provisions of the
Recovery of Debts Due to Banks and Financial Institutions (RDDBFI) Act, 1993 and
Securitization and Reconstruction of Financial Assets and Enforcement of Security
Interests (SARFAESI) Act, 2002.
Bank Credit by Sectors:
Agriculture & Allied Activities
Total advances in agriculture and allied activities stood at INR 7,186 billion as of
June 27, 2014. The advances has more than tripled in the last seven years, however
credit quality in agriculture is deteriorating with expected NPA to rise if the country
experiences poor monsoon. GNPA for this sector stood at 4.4% in FY 14.
Industry
Outstanding advances in this segment stood at INR 25,174 billion as of June 27,
2014. The advances have risen by more than 278% in the last seven years and
credit quality in this segment is just better than the agriculture segment. GNPA for
this sector stood at 3.7% in FY 13.

Services
Outstanding advances in this segment stood at INR 13,365 billion as of June 27,
2014. The advances have more than tripled in the last seven years and credit
quality in this segment is just better than the agriculture segment. GNPA for this
sector stood at 3.4% in FY 13.
Personal Loans
Advances in the personal loan segment also known as retail segment have almost
doubled in last seven years. Net outstanding advances as on June 27, 2014 stood at
INR 10,665 billion. This segment has the lowest amount of GNPA, i.e. close to 2.1%
as of FY 13 estimate.

PSBs in Trouble
The financial turmoil of 2008-09 and economic slowdown in 2011-12 and 2012-13
have impacted asset quality for PSBs more adversely than their private
counterparts. Gross NPAs of PSBs increased from 2.1% of gross advances in 2007-08
to 4.7% in 2013-14. PSBs accounted for 92% of the total NPAs of the banking
system in 2013-14. Increasing NPAs have put stress on the profitability of these
banks. Finance Ministry in August 2014 called for better risk management on the
part of PSBs to check the rising concerns over the deteriorating asset quality and for
professionalism in the processes of these banks.
Another issue that the banks are facing is compliance with adequacy norms. Banks
are currently required to have a capital adequacy ratio of 9%. But in line with the
Basel III, RBI has directed the banks to bring the ratio up to 11.5% latest by March
31, 2019. The transition period was initially set to be till March 31, 2018; but
following the concerns over the potential stress on the asset quality, specifically for
PSBs, and its consequent impact on their profitability, RBI extended the period by
one year. While most of the large private banks have comfortable levels of capital to
fulfil the requirements, PSBs face a challenge in the same. For example, in February
2014, UBI's capital adequacy ratio as per the new Basel formula fell to a bare
minimum level of 9.01% and the Tier-1 capital to 5.6% below the required 6%. So
much so the bank had to put restrictions on lending to save capital. To be able to
sustain and grow UBI and the like need to raise capital from public. At least Rs.
2,40,000 crores need to be infused into the sector by 2018. This in itself is a
challenging task for the PSBs. Non-equity instruments are highly expensive and
risky for the banks, given the new set of guidelines regarding the coupon payments.
The new guidelines stipulate that banks will be allowed to pay coupon from only the
current years profits and the total coupon payout will be capped at 40 per cent of
the banks total distributable surplus for the year. On the other hand, raising capital
through equity is equally difficult given their weak performance in recent quarters
and their low equity valuations. Government support is thus their only resort to be
able to revive.

However, government is not very willing to extend such support for a long time. To
reduce the fiscal burden, it is planning to cut its stake in PSBs to 58%. In June 2014,
it indicated to bankers that it may not be able to support them forever. In the Union
Budget 2014-15, public sector banks were allowed to sell their shares to retail
investors so long as the government shareholding does not go below 51 percent.
These funds can be used to recapitalize banks and fund their expansion, helping in
greater penetration of banks in the underserved areas.
Not only this, both RBI and government have noted the fragmented nature of the
Indian banking system and the small size of the typical banks. At the end of 2013,
only one Indian bank could make it up to the list of top 100 banks in the world by
assets. SBI, the largest bank of India is almost one tenth the size of the largest bank
of the world. Due to their small size, Indian banks are not able to compete globally
in terms of fund mobilization, credit disbursal, investment and rendering of financial
services. With RBI granting new licenses, it would become increasingly difficult for
these banks to survive in the competitive environment. The government is thus now
encouraging consolidation of smaller banks with the larger ones. For instance, in
July 2014, it asked IDBI Bank and Union Bank of India to prepare a consolidation
plan. However, consolidation may not come about as easily as it seems. Banks need
to consider human resource issues, geographical spread and technology platforms
before materializing any plans. As noted by a partner at EY, consolidation would
make sense only when the government is able to cut on duplication in branches,
people and infrastructure. This would mean closing down of overlapping branches,
leading to retrenchments and dissatisfaction amongst employees. Further,
differences in culture and technology platforms being currently used would act as
hindrance for any consolidations. The times to come will tell how successfully banks
and government are able to tackle them and attain their objectives.

Priority Sector Lending

Banks have been assigned a special role in the economic development of the
country, besides ensuring the growth of the financial sector. The banking regulator,
the Reserve Bank of India, has hence prescribed that a portion of bank lending
should be for developmental activities, which it calls the priority sector. As defined
by RBI, priority sector refers to those sectors of the economy which may not get
timely and adequate credit in the absence of this special dispensation. Typically,
these are small value loans to farmers for agriculture and allied activities, micro and
small enterprises, poor people for housing, students for education and other low
income groups and weaker sections.
Domestic banks, both public and private sector and foreign banks with more than
20 branches have to lend 40% of their Adjusted Net Bank Credit(ANBC) or credit
equivalent amount of Off-Balance Sheet Exposure, whichever is higher, to the
priority sector. Foreign banks with less than 20 branches have to lend 32% of their
ANBC or credit equivalent amount of Off-Balance Sheet Exposure, whichever is

higher, to the priority sector. There are sub-targets for different sectors within the
main target for the banks to fulfill.
In January 2014, it was recommended by a RBI panel to increase the priority sector
lending target to 50%. However, any action is yet to be taken in this regard.
Priority Sector includes the following categories:
Agriculture (Direct and Indirect finance): Direct finance to agriculture shall include
short, medium and long term loans given to farmers, farmers partnership firms and
corporate bodies, and Self Help Groups for agriculture and allied activities.
Micro and Small Enterprises (Direct and Indirect Finance): Bank loans to micro
and small enterprises, both manufacturing and service are eligible as priority sector.
These include food and agro processing units, khadi and village industries and other
manufacturing and service concerns as defined under the MSMED Act.
Education: Education loans include loans and advances granted to only individuals
for educational purposes up to Rs. 10 lakhs for studies in India and Rs. 20 lakhs for
studies abroad.
Housing: Loans to individuals for purchase/construction/repairs of a dwelling unit
per family (excluding loans sanctioned to banks own employees) are included.
Besides, loans for housing projects for economically weaker sections and to Housing
Finance Companies (HFCs) also qualify under PSL subject to certain conditions.
Export Credit: Export Credit extended by foreign banks with less than 20 branches
will be reckoned for priority sector target achievement. For domestic banks and
foreign banks with 20 and above branches, export credit is not a separate category
under priority sector.
Others: Several other loans classify as priority sector lending as notified by the RBI.

Financial Inclusion
Financial Inclusion is the process of ensuring access to appropriate financial
products and services needed by all sections of the society in general and
vulnerable groups such as weaker sections and low income groups in particular at
an affordable cost in a fair and transparent manner by mainstream institutional
players. The various initiatives taken by the government and RBI in this regard are
as follows:
Pradhan Mantri Jan Dhan Yojana:
The new Narendra Modi government rolled out the Jan Dhan Yojana with a target of
universal access to banking facilities. The scheme aims to ensure that every
household has at least two bank accounts. It was launched on 28 August, 2014,
when more than 1.5 crore bank accounts were opened up in a single day. Each of
these came with a RuPay debit card, Rs.1 lakh accident insurance cover and an

additional Rs. 30,000 life insurance cover. These benefits will apply to all accounts
opened before January 26, 2015. After six months of satisfactory operations, the
account would be eligible for Rs 5,000 overdraft facility, designed to take the poor
out of the clutches of moneylenders. The program aims to cover at least 7.5 crore
families before the next Republic Day. The second phase of the program is intended
to be implemented between 2015 and 2018 and will cover aspects like micro
insurance and pension. All the 6 lakh villages are to be mapped according to the sub
service area, and villages with over 2,000 populations will get full-fledged brick &
mortar bank branches as per the scheme. The government is also keen that the
banking sector should add 7,000 branches and 20,000 ATMs as part of the plan.
Differentiated banking licenses
India currently follows the universal banking model where banks are holding
companies that operate different businesses like asset management, insurance,
asset reconstruction, stock broking, etc., through subsidiaries, joint ventures and
affiliates. RBI issues a single class of banking license to both domestic as well as
foreign banks and all of them are eligible to carry out all banking operations. This
will change with the issue of differentiated banking licenses. As mentioned by the
Finance Minister in the Union Budget 2014-15, differentiated banks serving niche
interests, local area banks, payment banks etc. are contemplated to meet credit
and remittance needs of small businesses, unorganized sector, low income
households, farmers and migrant work force. RBI came out with draft guidelines for
licensing of Payment Banks and Small Banks in April 2014.

Payment Banks: Payment banks would be similar to banks for the

depositors. They will be allowed to accept demand deposits and provide
payment and remittance services. But they will not be allowed to accept term
deposits or lend money. They will thus provide small savings accounts and a
banking system for migrant labor workforce, low income households etc.
Payment banks will also be required to have at least 25 per cent of access
points in rural centers, further helping in financial inclusion.

Small Banks: Small banks will be set up with an objective of financial

inclusion by providing savings accounts to underserved sections of society
and supplying credit to small business units, farmers and other unorganized
sector entities. The basic difference in these banks would be that the area of
operations for them will be restricted to particular groups of districts which
are in close proximity and enjoy the same culture.
The existing non-bank Prepaid Payment Instruments issuers, Non-Banking
Finance Companies (NBFCs), corporate BCs, mobile telephone companies,
super-market chains, companies, real sector cooperatives and public sector
entities can apply to set up Payments Banks.

Other Steps towards Financial Inclusion

1. With the objective of ensuring greater financial inclusion and increasing the
outreach of the banking sector, RBI enables banks to use the services of NonGovernmental Organisations/ Self Help Groups (NGOs/ SHGs), Micro Finance
Institutions (MFIs) and other Civil Society Organisations (CSOs) as
intermediaries in providing financial and banking services through the use of
Business Facilitator and Correspondent models. Nearly 2,48,000 Business
Correspondent (BC) agents had been deployed by banks as on March 31,
2014 which are providing services through more than 3,33,000 BC outlets.
2. Another step taken to promote inclusion is increase financial literacy, i. e. to
create awareness about the formal financial system by conducting financial
literacy camps in the unbanked areas of the country. The National Centre for
Financial Education (NCFE) has also been set up for the same purpose.
3. RBI has simplified the Know Your Customer (KYC) norms for opening bank
accounts. The major changes include:

Single document valid as proof for identity and address

No proof required for current address
No separate KYC documentation required for transfer of account from
one branch to another of the same bank
Time intervals for periodic updation of KYC for existing low/medium and
high risk customers increased from 5/2 years to 10/8/2 years,
respectively

Infrastructure Lending
The RBI, in order to encourage infrastructure development and affordable housing,
has made lending to infrastructure sector by the banks easier. Infrastructure and
core industries projects generally have long gestation periods and large capital
requirements. Banks currently face issues like asset liability mismatch while lending
for such projects, and thus do not lend for more than 12-15 years. To overcome the
issues, new set of guidelines have been issued.
Under the new guidelines, banks can issue long-term bonds with a minimum
maturity of seven years to raise resources for lending to (i) long term projects in
infrastructure sub-sectors, and (ii) affordable housing. These bonds will be
exempted from computation of net demand and time liabilities (NDTL) and would
therefore not be subjected to CRR/SLR requirements. They will also get exemption in
computation of Adjusted Net Bank Credit (ANBC) for the purpose of Priority Sector
Lending.
A 5/25 structure would be allowed while lending for infrastructure projects. This will
allow a bank to loan money to a developer for 25 years, with an option of rewriting
the terms of the loan or transferring it to another bank or financial institution after

five years. Thus banks will be able to match the tenure of the loan with the life cycle
of the underlying asset. All these measures will help boost growth of the
infrastructure sector through the banking sector.

ANALYSIS
Short Term Investment
For short term investment, we would look at the return that an investor may be able
to get, and the associated risk with the same. We have identified following factors
to analyze the same:
Short Term
Investment
Risk
Return
Share Price
Beta
Trend
PAT Growth

Share Prices for last 1 year:

All the three stocks have outperformed the market index, Sensex.
ICICI is performing with the industry, i.e. its prices are moving in alignment
with the Banking sectors performance as a whole. It shows slow growth in
the market price.
However, in the past 3 months, share prices of all the stocks have remained
quite the same and have underperformed the benchmark index.

Risk Factor Beta:

Yes Bank, having the smallest market capitalization, has the highest beta factor,
indicating highest risk. It is followed by ICICI Bank and Bank of Baroda.

P/E Ratio:
ICICI has the highest P/E ratio, indicating high growth expectations. Bank of Baroda,
which has seen negative growth in Profit after Tax in the year 2012-13, has the
lowest P/E.

PAT:
Yes Bank is growing at the fastest pace in terms of Profit after Tax. BOB has seen
negative growth in the past two years.

Conclusion

Yes Bank has the highest speed of growth in terms of both share prices and
PAT, but also has the highest risk. An investor with a high risk appetite should
go for this stock.
Bank of Baroda comes next in line, with a moderate risk involved and speedy
growth in share prices. Its P/E is low because of negative growth in the
previous year and negligible positive growth in this year.
ICICI Bank is the least risky share, with low Beta and steady growth in share
prices as well as profits. Investors interested in low risk and assured returns
should opt for this investment.

Short Term Lending

Banks mainly need short term funds to fulfill regulatory requirements. These include
the following:
Cash Reserve Ratio: Banks are required to keep a certain percentage of
their net demand and time liabilities in the form of cash in a current account
with RBI. This ratio is 4% currently. Of this, 95% has to be maintained on a
daily basis, and complete 4% to be reported fortnightly.
Statutory Liquidity Ratio: Banks are required to keep a part of their total
deposits as invested in approved securities, predominantly central
government securities. Currently the ratio is 22%.
Liquidity Coverage Ratio: Banks are required to hold an amount of highlyliquid assets, equal to or greater than their net cash outflow over a 30 day
period. This was proposed under Basel III to be at least 100%. RBI intends to
introduce LCR in a phased manner starting with a minimum requirement of
60% from January 1, 2015 and reaching minimum 100% on January 1, 2019.
Common terms in Money Market and inter-bank lending:
Call Money Market
Notice Money Market
Term Money
Market
Repo: A repurchase agreement between bank and RBI. In a way,
collateralized lending by RBI to banks
Bank Rate: Also referred as the discount rate, it is the rate of interest which
a central bank charges on the loans and advances that it extends to
commercial banks and other financial intermediaries. Currently it is 9%.

T-Bills: Issued by RBI on behalf of GoI. At present three types of treasury bills
are issued through auctions - 91 day, 182 day and 364 day treasury bills.
CD: Issued by banks and DFIs for short term funds for 3 months to 1 year
period.
CP: Issued by listed companies for working capital needs for 7 days to 1 year
period
MIBOR: Mumbai Inter Bank Offered Rate. Inspired from LIBOR, not used
much currently.

Major ratios identified:

Cash to Deposit Ratio
Funding Volatility Ratio

Cash to Deposit Ratio:

All the three banks have seen decrease in Cash/Deposit ratio over years, Yes
Bank has shown increase in it only in the last financial year.
Bank of Baroda has lowest Cash/Deposit Ratio, indicating that it may be in
need of short term funds to pay of its demand liabilities as and when they
arise.
ICICI, having a very high ratio, is not in need of the short term funds and thus
should not be lent. Similarly, Yes Bank has also a relatively high ratio.

Funding Volatility Ratio:

Calculated as:
Liquid assets / current and savings deposits

FVR of BOB is the highest, which makes it the safest of the three for short
term lending. The ratio is increasing constantly. But this may also show
inefficiencies on the part of the bank
Yes Bank has reduced its ratio drastically as it expanded.
ICICI has lowest FVR, but has maintained it over the years. It is
comparatively risky.

Conclusion:

ICICI is in need of funds but has high funding volatility, implying high risk. It
should be given short term funds, but we should remain cautious of the risk.

Long Term Investment

We identified following ratios:

P/BV:

P/BV of BOB has remained quite low,

going below the levels of August
2011 in mid-2013. This can be
attributed to drastic reduction in its
growth rate in 2013 and increasing
NPAs.
ICICI has seen increase in P/BV in
the last 5 years. This increase is slow
though, but quite steady.
Yes Bank has shown large increase
in its P/BV. But it has seen large
fluctuations too, making it a
comparatively risky stock.

NII Growth:

Over last five years, BOB and ICICI have shown growth at a decreasing rate.
This could be explained due to economic slump.

Yes Bank has shown increase in NII at an increasing rate, with a 240% growth
since 2010. It achieved this mainly by increasing its CASA and thus reducing
the cost of funds.

NIM:

NIM of ICICI Bank is increasing

rapidly and is highest in absolute
terms. This is mainly because of
high CASA component in its loan
book.

Yes Bank was growing its NIM

slowly till the last year and took a
leap only in the FY 2013-14

BOB is definitely a bad choice

here, with its continuously
decreasing NIM. A major reason for
this is high rate of NPAs. Unless it goes for complete revamp of its operations,
the bank is not expected to grow in future.

Cost Income Ratio:

Cost to Income Ratio of ICICI Bank

has been decreasing for the past 3
years. The reason for this is the
scale of its operations and
corresponding economies.

BOBs C/I reduced tremendously

between 2010 and 2012. But it
increased in a similar fashion in the
years to follow. Currently it has a very
high ratio, indicating low efficiency of
operations.

Yes Bank has increased its cost more

than its income during the period.
This is because of its expansion plans
that are expected to reap benefits in
the years to come. But this ratio
should not increase further, as it will impact its profitability.

Gross NPAs:

Gross NPAs as a percentage of

advances of ICICI are quite high at
3.03%. However, it has been able to
steadily reduce the same from
4.47% four years ago

BOB is showing increasing trend in

Gross NPAs. This is an adverse
situation, leading to decreased and
increasing risk profits to the bank

Yes Bank is very good is this

parameter, having just 0.31 % as
NPAs.

EPS:

All the three banks have face

values of their shares as Rs. 10,
thus making their EPS
comparable.

Bank of Baroda shows highest

EPS, due to its large scale and
expansion in the past. But it has
come down after 2012 and has
stagnated since then.

EPS of both ICICI and Yes Bank is

increasing steadily, with ICICI
having much higher EPS.

Dividend Yield:

Due to high EPS and increasing Dividend Payout since 2012, BOB has the
highest dividend yield.

Though BOB has highest Yield, but the variation in the same over years has
also been maximum, making it a little uncertain

ICICI and Yes Bank have similar Dividend Yield, with Yes Bank taking a huge
leap in the last year

Both the banks are expected to perform well in the coming years and so
expected to maintain

ROE:

Yes Bank has highest ROE,

which is consistently increasing
over years. It has less equity
and more borrowed funds as
compared to other banks.

ICICI too has an increasing

ROE, but substantially lower
than Yes Bank. This is to
support its expansion plans.

BOB had highest and an

impressive ROE of 20.2% back
in 2010. But the ROE has
decreased substantially,
because it has retained more
earnings for expansion, which has given it a relatively lower return.

Conclusion

ICICI is a good option for long term investment with steady returns. Interest
Margin and C/I Ratio indicating efficiency are impressive. However, low ROE
is a concern. Also, NPAs are much above the industry average, which pose a
risk of poor operational efficiency in future.

BOB has high EPS and Dividend Payout, but a decreasing ROE, which means
that EPS might also follow suit soon. Falling NIM, increasing operational costs
and NPAs, low Capital Adequacy Ratio (discussed later), and slow growth
make it a less attractive avenue for long term investment.

Yes Bank is showing very fast growth, with high ROE and NIM and very low
NPAs. The bank has large expansion plans too. But increasing cost of

operations in relation to the income is a concern. Also, P/BV shows frequent

fluctuations, making it a relatively risky stock.

Long Term Lending

The ratios used are:

Return on Assets:

Return on Assets is increasing

steadily in case of ICICI Bank,
which makes it the best option for
long term lending.

Bank of Baroda has shown fall in

return on assets and thus should
not be considered for lending
funds.

Yes Bank is not showing any

increase in ROA since 2011. A
lender would not like to lend to a
stagnated bank.

Credit/ Deposit Ratio:

Credit/ Deposit Ratio of ICICI

Bank has improved slightly, while
it has decreased in case of both
BOB and Yes Bank in the last
three years.

ICICI needs long term funds to

finance the credit it is currently
giving and thus should be
preferred in lending money.

BOB with such a low C/D ratio is

not fully utilizing its funds to
extend credit. Similarly Yes Bank
has scope of improvement.

Gross Block:

The assets of a bank would

include building, furniture,
computer systems and other
devices, ATMs etc.

ICICI requires funds as it plans

foreign expansion by opening up
branches in Australia, SA,
Mauritius

Yes Bank has a vast potential of

increasing its gross block so as
to expand. It has expansionary
plans of increasing its branches
from current 560 to 750 by 2015.
It will require long term funds for the same.

Capital Adequacy Ratio:

CAR of ICICI is sufficiently high. This means it has enough capital to absorb
unexpected losses in recovery of assets to a greater extent than others.

BOB has low which means

it cannot expand its assets
before adding more equity
capital. Any long term funds
lent to BOB would net be
utilized in expansion of
operations, until and unless
it first increases its core
capital base to a
comfortable level.

Yes Bank also has lower

CAR as compared to ICICI
but is in a better position
than BOB, and may be lent
funds if other parameters
are in favor.

Gross NPAs:

Gross NPAs as a percentage of

advances of ICICI are quite high at
3.03%. However, it has been able to
steadily reduce the same from
4.47% four years ago

BOB is showing increasing trend in

Gross NPAs. This is an adverse
situation, leading to decreased and
increasing risk profits to the bank

Yes Bank is very good is this

parameter, having just 0.31 % as
NPAs.

Conclusion

Comparing the ROA and C/D ratio shows ICICI is an attractive destination for
long term lending. Its CAR is also sufficient due to which it has very less
dilution risk. It has shown slow growth in gross block for past some years and

would be looking to speed it up, for which it require long term capital. This
makes it an attractive entity for parking long term funds.

However, it has high NPAs as compared to the other players, which make it
slightly more risky. So long-term lending must be done with caution.

Yes Bank may also be considered for lending, as it has shown very rapid
growth in its profits as well as gross block in the past five years. It also has a
sufficient CAR percentage and very low NPAs as compared to the other
players.

Strategic Decision

ICICI Bank

ICICI has a wide network of branches in the country, with 3753 branches and
11,315 ATMs, of which more than 15% were opened in the last fiscal.

With a huge presence in urban areas, it should increase its penetration in

rural and semi urban areas. It has already initiated this, with 75% of its new
653 braches opened in such areas.

Bank should also focus on expansion in foreign countries. It has recently

announced its plans to open branches in China, Australia, South Africa and
Mauritius. It currently has largest overseas operations amongst Indian private

banks with presence in 19 countries , and has vast opportunities to further

expand them.

High CASA Ratio should be maintained in the future as well. NPAs are very
high as compared to the competitors, which affect the interest margins. Bank
needs more prudent risk assessment and provisioning.

Bank of Baroda

Global CASA Deposits rose by 22%. But the CASA Ratio has declined, which
has led to decreased the profitability, as measured by NIM. The bank should
focus on controlling its costs and improving its operational efficiency, along
with expansion.

Asset quality improvement will be a major concern, with rising Gross as well
as Net NPAs over the years.

Its Capital Adequacy Ratio of 11.91% will make it highly vulnerable of falling
short of the required capital in 2-3 years.

Bank has expressed its interest in acquiring regional banks in response to

governments plans to encourage consolidation.

BOB has correctly decided its motto for FY15 as RACE Ahead, which stands
for:
Retail Leaning
Earnings

Asset Quality

Capacity Building

Yes Bank

Has strong presence in

northern and western India;
should focus on increasing
presence in eastern and
southern parts by raising
long term funds. May even
look at acquisitions.

Raised funds of $500

million (Rs. 2942 crore)
through QIP, raising the
CRAR to above 18%,
enough to fund 30% growth
for more than 2 years.

CASA is just 22 per cent.

Should focus on retail
banking more to reduce the
cost of funds. This will help
increasing profitability.

APPENDIX
ICICI Bank
Valuation Ratios
FY14
P/E
15.0
2
P/BV
1.97
P/CEPS
14.1
7

EV/EBIDTA
FY13
15.0
1
1.81
14.1
5

FY12
16.3
8
1.69
15.1
1

Market
Cap/Sales
Ratio Analysis
Credit-Deposit

13.9
4
2.63

13.5
8
2.49

100.71

14.3
7
2.49

99.25

97.71

Inv. / Deposit
Cash / Deposit
Int. Paid / Int.
Rcvd
Other Y / Total Y
Op. Exp/ Total Y
Int. Y / Total
Funds
Int. Paid / T Funds
NII / TFunds
Non Int. Y/T
Funds
Op. Exp. / T
Funds
Pr. bfr Prov/ T
Funds
NP/ T funds
RONW
GNPA (Rs. Cr)
NNPA (Rs. Cr)
NNPA/ Net
Advance
CRAR
Tier I Capital (%)
Tier II Capital (%)
Return on Assets
(%)
Cash Flow
C & CE at Beginning
Cash from
Op.Activities
Cash Used in Inv
Activities
Cash Used in Fin.
Activities
Net Inc in C & CE
C & CE at End

Balance Sheet
SOURCES OF
FUNDS :
Capital
Reserves Total
Equity Application
Money
Deposits
Borrowings
Other Liabilities &
Prov.
TOTAL LIABILITIES
APPLICATION OF
FUNDS
Cash & Balances
with RBI
Money at Call

55.79
6.54
62.71

60.38
7.21
65.4

61.16
8.6
68

Investments
Advances
Fixed Assets

19.1
18.88
7.79

17.24
18.61
7.81

18.28
19.13
7.49

Other Assets

4.89
2.91
1.84

5.11
2.7
1.63

5.09
2.4
1.67

1.82

1.76

1.75

2.93

2.57

2.32

1.73
14.02
10,505.8
4
3,297.96
0.97

1.62
13.1
9,607.7
5
2,230.5
6
0.77

1.44
11.2
9,475.3
3
1,860.8
4
0.73

0
0
0
1.78

16.9
11.5
5.4
1.7

16.26
11.09
5.17
1.5

41417.5
2
4668.6

36229.3
1
11102.0
1

11394.8
9
6838.37

8903.52

112.08
41529.6

5188.21
41417.5
2

2989.72

TOTAL ASSETS
Contingent Liability
Bills for collection

Income Statement
INCOME :
nterest Earned

34090.0
8
14332.3
6
12280.1
7
28751.7
6
2139.23
36229.3
1

Other Income
Total
II. Expenditure
Interest expended
Payments
toEmployees
Op. & Admn. Expenses
Depreciation
Other Expenses,
Provisions &
Contingencies
Provision for Tax
Deferred Tax
Total
III. Profit & Loss
Reported Net Profit
Extraordinary Items
Adjusted Net Profit
Profit brought forward
IV. Appropriations
Trfr to Statutory
Reserve
Trfr to Other Reserves

1,155.0
4
72,051.
71
6.57

1,153.6
4
65,547.
84
4.48

1,152.7
7
59,250.
09
2.38

331,913
154,759
36,996.
28
596,882

292,613
145,341
32,601.
85
537,262

255,499
140,164
33,426.
20
489,496

21,821.
82
19,707.
77

19,052.
73
22,364.
79

20,461.
29
15,768.
02

Proposed Dividend
Balance carried
forward to Balance
Sheet
Equity Dividend %
Earnings Per Share
Book Value

177,021
338,702
4,678.1
4
34,950.
12
596,882
781,430
13,534.
91

171,393
290,249
4,647.0
6
29,555.
32
537,262
789,989
12,394.
53

159,560
253,727
4,614.6
9
35,364.
61
489,496
915,465
7,572.0
6

44,178.
15
10,427.
87
54,606.
02

40,075.
60
8,345.7
0
48,421.
30

33,542.6
5
7,502.76

27,702.
59
4,220.1
1
2,506.3
9
575.97
5,637.8
0

26,209.
18
3,893.2
9
2,198.7
9
490.16
4,240.1
8

22,808.5
0
3,515.28

3,839.5
0
313.19
44,795.
55

2,998.2
0
66.02
40,095.
82

2,187.42

9,810.4
8
95.82
9,714.6
6
9,902.2
9

8,325.4
7
25.77
8,299.7
0
7,054.2
3

6,465.26

2,453.0
0
1,107.6
2
2,833.5
6
13,318.
59

2,082.0
0
795.78

1,617.00

2,599.6
4
9,902.2
9

2,122.82

230
82.93
633.8

200
69.63
578.18

165
54.17
523.98

Break up of Deposits
Demand
43,245.4
Deposits
1
Savings
99,133.0
Deposit
0
Term Deposits
189,535.
25

36,925.5
2
85,650.7
4
170,037.
37

41,045.4
1

1,925.30
524.53
3,474.47

144.65
34,580.1
5

-1.24
6,466.50
5,018.18

689.39

7,054.23

34,973.0
6
76,046.3
1
144,480.
59

Beta 1.7598
162940

Average Weekly Volume

Yes Bank
Valuation Ratios
FY14
P/E
15.0
2
P/BV
1.97
P/CEPS
14.1
7
EV/EBIDTA
13.9
4
Market
2.63
Cap/Sales
Ratio Analysis
Credit-Deposit
Inv. / Deposit
Cash / Deposit
Int. Paid / Int.
Rcvd
Other Y / Total Y
Op. Exp/ Total Y
Int. Y / Total
Funds
Int. Paid / T Funds
NII / TFunds
Non Int. Y/T
Funds
Op. Exp. / T
Funds
Pr. bfr Prov/ T
Funds
NP/ T funds
RONW
GNPA (Rs. Cr)
NNPA (Rs. Cr)
NNPA/ Net
Advance
CRAR
Tier I Capital (%)
Tier II Capital (%)
Return on Assets
(%)
Cash Flow
C & CE at Beginning
Cash from
Op.Activities
Cash Used in Inv
Activities

FY13
15.0
1
1.81
14.1
5
13.5
8
2.49

Cash Used in Fin.

Activities
Net Inc in C & CE
C & CE at End

FY12
16.3
8
1.69
15.1
1
14.3
7
2.49

Balance Sheet
SOURCES OF
FUNDS :
Capital
Reserves Total

100.71
55.79
6.54
62.71

99.25
60.38
7.21
65.4

97.71
61.16
8.6
68

19.1
18.88
7.79

17.24
18.61
7.81

18.28
19.13
7.49

4.89
2.91
1.84

5.11
2.7
1.63

5.09
2.4
1.67

1.82

1.76

1.75

Equity Application
Money
Deposits
Borrowings
Other Liabilities &
Prov.
TOTAL LIABILITIES
APPLICATION OF
FUNDS
Cash & Balances
with RBI
Money at Call
Investments

2.93

2.57

2.32

1.73
14.02
174.93
26.07

1.62
13.1
94.32
6.99

1.44
11.2
83.86
17.46

0.05
0
0
0

0.01
0
0
0

0.05
0
0
0

9.92

10.04

10.14

4065.76

3585.54

3495.98

4448.93
2798.92

540.64
6741.53

3588.49
4863.45

Advances
Fixed Assets
Other Assets
TOTAL ASSETS
Contingent Liability
Bills for collection

Income Statement
INCOME :
Interest Earned

175.89
1825.9
5891.66

360.63

6681.11
480.22
4065.76

1364.52
89.56
3585.54

358.62
5,449.0
5

352.99
4,323.6
5

6,387.75
109,015.
80

0
66,955.
59
20,922.
15
5,418.7
2
99,104.
13

0
49,151.
70
14,156.
49
5,640.8
5
73,625.
68

4,541.57

3,338.7
6

2,332.5
4
1,253.0
0
27,757.
35
37,988.
64
177.1
4,117.0
5
73,625.
68
164,12
5.5
402.05

6,761.11
0
74,192.0
2
21,314.2
9

1,350.10
40,950.3
6
55,632.9
6
293.47
6,247.33
109,015.
7
200,992.
9
997.06

9,981.3
5

727
42,976.
0
46,999.
5
229.55
4,833.2
1
99,104.
1
247,77
8.
677.4

8,294.00

6,307.36

Other Income
Total
II. Expenditure
Interest expended
Payments
toEmployees
Op. & Admn. Expenses
Depreciation
Other Expenses,
Provisions &
Contingencies
Provision for Tax
Deferred Tax
Total
III. Profit & Loss
Reported Net Profit
Extraordinary Items
Adjusted Net Profit
Profit brought forward
IV. Appropriations
Trfr to Statutory
Reserve
Trfr to Other Reserves
Proposed Dividend
Balance carried
forward to Balance
Sheet
Equity Dividend %
Earnings Per Share
Book Value

1,721.5
8
11,702.
93

1,257.43

857.12

9,551.43

7,164.48

7,265.0
9

6,075.21

4,691.72

784.4
393.57
63.17

655.54
297.78
51.71

475.15
204.29
40.82

870.42
778.41
-69.91
10,085.
15

545.47
667.76
-42.71

302.48
503.63
-30.61

8,250.75

6,187.48

1,300.68
-0.51

977
-0.93

1,617.7
8
-0.09
1,617.8
7
2,338.3
7

404.45
4.58
339.67
3,207.4
6
80
43.45
197.48

Break up of Deposits
Demand
7,017.16
Deposits
Savings
9,327.52
Deposit
Term Deposits
57,847.3
4

Beta 2.2756
407582

1,301.19

977.93

1,658.
39

1,115.
06

325.17
44.58
250.96

2,338.37
60
35.29
161.94

244.25
25.35
164.07

1,658.39
40
27.03
132.49

6,664.88

4,888.36

6,022.65

2,503.78

54,268.0
6

41,759.5
6

Average Weekly Volume

Bank of Baroda
Valuation Ratios
FY14
P/E
7.09
P/BV
0.86
P/CEPS
6.57
EV/EBIDTA
15.4
2
Market
Cap/Sales
0.72
Ratio Analysis
Credit-Deposit
Inv. / Deposit
Cash / Deposit
Int. Paid / Int.
Rcvd
Other Y / Total Y
Op. Exp/ Total Y
Int. Y / Total
Funds
Int. Paid / T Funds
NII / TFunds
Non Int. Y/T
Funds
Op. Exp. / T
Funds
Pr. bfr Prov/ T
Funds
NP/ T funds
RONW
GNPA (Rs. Cr)

FY13
6.61
0.9
6.19

FY12
6.69
1.19
6.33

15.3

14.7

0.74

0.99

C & CE at End

Balance Sheet
SOURCES OF
FUNDS :
Capital
Reserves Total
Equity Application
Money

Other Liabilities &

Prov.
TOTAL LIABILITIES

71.68
23.83
4.09

74.76
22.4
6.01

69.27
10.28
16.44

67.85
9.35
15.32

65.23
10.34
15.59

6.45
4.47
1.98

7.08
4.8
2.28

7.37
4.8
2.56

0.74

0.73

0.85

1.18

1.2

1.28

1.54
0.75
13.36
11,875.9
0
6,034.76

1.81
0.9
15.07
7,982.5
8
4,192.0
3

2.13
1.24
20.64
4,464.7
5
1,543.6
4

1.52
0
0
0

1.28
0
0
0

0.54
12.95
9.56
3.39

6.76

7.34

7.58

Cash Flow
C & CE at Beginning
Cash from
Op.Activities
Cash Used in Inv
Activities
Cash Used in Fin.
Activities
Net Inc in C & CE

Borrowings

69.54
22.78
3.08

NNPA (Rs. Cr)

NNPA/ Net
Advance
CRAR
Tier I Capital (%)
Tier II Capital (%)
Return on Assets
(%)

Deposits

APPLICATION OF
FUNDS
Cash & Balances
with RBI
Money at Call
Investments
Advances
Fixed Assets
Other Assets
TOTAL ASSETS
Contingent
Liability
Bills for
collection

473,883.
3
26,579.2
8
14,703.3
8
547,135.
4

384,871.
1
23,573.0
5
11,400.4
6
447,321.
4

18,629.0
9
112,248.
8
116,112.
6
397,005.
8
2,734.12
12,774.0
3
659,504.
53
259,912.
7
31,864.9
2

13,452.0
8
71,946.8
3
121,393.
7
328,185.
7
2,453.12

21,651.4
6
42,517.0
8
83,209.4
0
287,377.
29
2,341.50
10,224.7
3
447,321.
4
152,502.
81
22,766.9
9

Income Statement
INCOME :
Interest Earned
Other Income
Total
II. Expenditure
Interest expended

85398.9
41016.3
8

64168.5
4
22793.0
8

49934.0
7

-688.7

-772.45

-337.38

5151.33
45479.0
1
130877.
9

-790.27
21230.3
6

165.35
14234.4
7
64168.5
4

85398.9

568,894.
3
36,812.9
7
17,811.5
0
659,504.
5

14406.5

Payments
toEmployees
Op. & Admn. Expenses
Depreciation
Other Expenses,
Provisions &
Contingencies
Provision for Tax
Deferred Tax
Total
III. Profit & Loss
Reported Net Profit
Extraordinary Items
Adjusted Net Profit

430.68
35,555.0
0

422.52
31,546.9
2

412.38
27,064.4
7

Profit brought forward

IV. Appropriations
Trfr to Statutory
Reserve
Trfr to Other Reserves

9,703.93
547,135.
4
204,628.
91
25,952.2
4

38,939.
71
4,462.7
4
43,402.
45

35,196.
65
3,630.6
2
38,827.
27

29,673.7
2

26,974.
36
4,139.7
2
1,576.5
2
345.03

23,881.
39
3,449.6
5
1,305.3
8
300.64

19,356.7
1

4,869.5
1
956.23
0
38,861.
37

5,059.0
0
350.51
0
34,346.
56

4,541.0
8
0.16
4,540.9
2
0

4,480.7
2
-0.74
4,481.4
6
0

1,135.2
7
2,322.1

1,120.1
8
2,300.9

3,422.33
33,096.0
5

2,985.58
1,121.08
276.57

3,330.31
1,018.84
0
28,089.0
9

5,006.96
-37.21
5,044.17
0

1,253.30
2,941.37

Proposed Dividend
Balance carried
forward to Balance
Sheet
Equity Dividend %
Earnings Per Share
Book Value

3
1,083.6
8

1
1,059.6
3

812.29

0
215
101.78
835.56

0
215
102.47
756.64

0
170
118.72
666.3

Break up of Deposits
Demand
50,050.3
Deposits
9
Savings
96,437.4
Deposit
4
Term Deposits
422,406.
56

35,678.3
1
84,302.6
1
353,902.
42

28,944.3
6
74,579.5
3
281,347.
21

Beta 1.7306
113852

Average Weekly Volume