Assignment on Ratio Analysis of

Eastern Bank Ltd

Submitted By;

Sumaiya Akter

ID NO:- 183-11-1168

Sumiya Akter Prity

ID NO:- 183-11-1177

Course Name:- Fundamentals of Banking

Course Code:- BNK-201

Submission Date:- 18th August 2021

Items 2017 2018 2019 2020
Net interest 5745 7605 8159 5930
income
Operating 12401 13139 14597 14134
Income
Operating 5605 5995 6387 6441
Expense
Total Asset 253068 282451 335163 336936
Shareholder’s 21586 22966 25567 28976
Equity
Tax 1652 1505 2248 2588
Profit After 2405 3081 4008 4103
Tax
Net Interest 3405 4520 5650 2980
Expense
Non Interest 3500 2420 4489 2390
Income
Non Interest 4300 3400 3520 3420
Expense
Earning Asset 227008 254115 299607 307845
BDT in Millions

Ratio Analysis for year 2017:-

ROE= Net income after tax ÷ Total Equity Capital

= 2405 ÷ 21586

= 11.14%

ROA= Net income after tax ÷ Total asset

= 2405 ÷253068

=0.95%

Operating profit Margin= ( Total operating revenue – Total operating

expense) ÷ Total asset

= {(12401+3500)-(5605+4300)} ÷ 253068

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 =2.37%

Net profit margin= Net income after tax ÷ Total operating revenue

= 2405 ÷ (12401+3500)

=15.12%

Degree of Asset Utilization= Total operating revenue ÷ Total asset

= (12401+3500) ÷ 253068

= 0.0628 times

Earning per share= Net income after tax ÷ No of share

= 2405000000 ÷ 2000000

=1202.20 million

Equity Multiplier= Total Asset ÷ Total equity capital

= 253068 ÷ 21586

= 11.72 times

Net Interest margin=( Interest income – Interest expense ) ÷ Total asset

= ( 5745 – 3405 ) ÷ 253068

= 0.925%

Net Non Interest Margin= ( Non interest income – Non interest expense)
÷ Total asset

= ( 3500 – 4300 ) ÷ 253068

= -0.316%

Earning Spread= ( Interest income ÷ Earning asset ) - ( Interest expense

÷ Total liability )

= ( 5745 ÷ 227008 ) - ( 3405 ÷ 231482 )

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 = 1.0598%

Ratio Analysis for year 2018:-

ROE= Net income after tax ÷ Total Equity Capital

= 3081 ÷ 22966

= 13.42%

ROA= Net income after tax ÷ Total asset

= 3081 ÷ 282451

=1.09%

Operating profit Margin= ( Total operating revenue – Total operating

expense) ÷ Total asset

= {(13139+2420)-(5605+3400)} ÷ 253068

=2.59%

Net profit margin= Net income after tax ÷ Total operating revenue

= 3081 ÷ (13139+2420)

=19.80%

Degree of Asset Utilization= Total operating revenue ÷ Total asset

= (13139+2420) ÷ 282451

= 0.055 times

Earning per share= Net income after tax ÷ No of share

= 3081000000 ÷ 2000000

=1540.50 million

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Equity Multiplier= Total Asset ÷ Total equity capital

= 282451 ÷ 22966

= 12.299 times

Net Interest margin=( Interest income – Interest expense ) ÷ Total asset

= ( 7605 – 4520) ÷ 282451

= 1.092%

Net Non Interest Margin= ( Non interest income – Non interest expense)
÷ Total asset

= ( 2420 – 3400 ) ÷ 282451

= -0.347%

Earning Spread= ( Interest income ÷ Earning asset ) - ( Interest expense

÷ Total liability )

= ( 7605÷ 254115 ) - ( 4520 ÷ 259485 )

= 1.25%

Ratio Analysis for year 2019:-

ROE= Net income after tax ÷ Total Equity Capital

= 4008 ÷ 25567

= 15.68%

ROA= Net income after tax ÷ Total asset

= 4008 ÷ 335163

=1.196%

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Operating profit Margin= ( Total operating revenue – Total operating
expense) ÷ Total asset

= {(14597+4489)-(6387+3520)} ÷ 335163

=2.74%

Net profit margin= Net income after tax ÷ Total operating revenue

= 4008 ÷ (14597+4489)

=66.98%

Degree of Asset Utilization= Total operating revenue ÷ Total asset

= (14597+4489) ÷ 335163

= 0.057 times

Earning per share= Net income after tax ÷ No of share

= 4008000000 ÷ 2000000

=2004 million

Equity Multiplier= Total Asset ÷ Total equity capital

= 335163 ÷ 25567

= 13.12 times

Net Interest margin=( Interest income – Interest expense ) ÷ Total asset

= ( 8159 – 5650 ) ÷ 335163

= 0.75%

Net Non Interest Margin= ( Non interest income – Non interest expense)
÷ Total asset

= ( 4489 – 3520 ) ÷ 335163

= 0.29%

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Earning Spread= ( Interest income ÷ Earning asset ) - ( Interest expense
÷ Total liability )

= ( 8159 ÷ 299607 ) - ( 5650 ÷ 306596)

= 0.88%

Ratio Analysis for year 2020:-

ROE= Net income after tax ÷ Total Equity Capital

= 4103 ÷ 28976

= 14.16%

ROA= Net income after tax ÷ Total asset

= 4103 ÷ 336936

=1.22%

Operating profit Margin= ( Total operating revenue – Total operating

expense) ÷ Total asset

= {(14134+2390)-(6441+3420)} ÷ 336936

=1.99%

Net profit margin= Net income after tax ÷ Total operating revenue

= 4103÷ (14134+2390)

=24.83%

Degree of Asset Utilization= Total operating revenue ÷ Total asset

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 = (14134+2390) ÷ 336936

= 0.049 times

Earning per share= Net income after tax ÷ No of share

= 4103000000 ÷ 2000000

=2051.50 million

Equity Multiplier= Total Asset ÷ Total equity capital

= 336936 ÷ 28976

= 11.63 times

Net Interest margin=( Interest income – Interest expense ) ÷ Total asset

= ( 5930– 2980 ) ÷ 336936

= 0.88%

Net Non Interest Margin= ( Non interest income – Non interest expense)
÷ Total asset

= ( 2390 – 3420 ) ÷ 336936

= -0.306%

Earning Spread= ( Interest income ÷ Earning asset ) - ( Interest expense

÷ Total liability )

= (5930 ÷ 307845 ) - ( 2980 ÷ 307960)

= 0.96%

The ratio analysis of Eastern Bank are interpreting through chart for
these respective year;

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So, the highest percentage of ROE is visible in 2019 . And also can say
that in 2020 the rate is lower than 2019.

So, the highest percentage of ROA is visible in 2019 . And also can say
that in 2020 the rate is lower than 2019.

So, the highest percentage of Earning spread is visible in 2018. And

also can say that in 2019 and 2020 the rate is decreased than 2019.

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So, the highest percentage of Net profit margin is visible in 2019 . And
also can say that in 2020 the rate is lower than 2019.

So, the highest percentage of Operating profit margin is visible in

2019 . And also can say that in 2020 the rate is lower than 2019.

So, the highest percentage of net interest margin is visible in 2018.

And we can say that in 2019 and 2020 this rate is decreased.

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