DOES IT PAYOFF?

STRATEGIES OF
TWO BANKING GIANTS
 Correlation between IT Expenditure and Net
profit of HSBC

  Net profit It Expenditure

Net profit 1

It Expenditure 0.921131 1
 Correlation between IT Expenditure
and Net profit of Citigroup

  Net profit it expenditure

Net profit 1

it expenditure 0.466426 1
Regression
 Return on Assets

• ROA= Avg. net profit/Avg. net assets*100

 ROA of HSBC = 0.871847

 ROA of Citigroup = 1.177648
Return on Capital Employed(ROCE)
 Ratio Between Number of Employees in
HSBC and Citigroup
Year HSBC Citigroupe Ratio

1997 132,285 170,000

0.778147
1998 136,433 170,000
0.802547
1999 154,000 180,000
0.855556
2000 172,000 230,000
0.747826
2001 180,000 268,000
0.671642
2002 192,000 250,000
0.768
2003 232,000 275,000
0.843636
2004 253,000 290,332
0.871416
2005 284,000 299,938
0.946862
2006 312,000 325,000
0.96
Thank you