Financial Performance Evalution Of SBI

Bank
Introduction-:
Performance evalution is the basic of a
management control system. Periodic comparision
of the actual costs, revenues and investment with
budgeted cost revenues and investment can help is
management is taking decision about future
allocation.
Performance evalution should be done in all
respect of all responsibility centres.
1. cost centre
2. investment centre
3. profit centre
The best way of encourage manager to achive the
desired level of performance is to measure their
performance in comparision to budgeted results.

According to Gary Dessler:

Appraising performance serves two functions First
performance appraisals are the basic on which
various administrative decision that include salary
increases,promotion and transfer.preformance
appraisal also serves as a work planning and
review function.the appraisal and subordinate
review provide an opportunity to review your
subordinate progress and to make out a plan for
rectifying any problem that might be identified.

Meaning of banking:
A bank is a licensed and regulated financial
institution that lends money accepted deposite and
carries out other financial transaction for its clients.
Definition of a Bank
Oxford Dictionary defines a Bank as an
establishment for custody of a mobsney. Which it
pays out on customers order.

History of Bank:
Banking began with the first prototype banks of merchants of the ancient world.
Which made grain loans to farmers and traders who carried goods between cities.
This began around 2000 BC in Assyria and babylonia. Later in ancient Greece and
during the roman Empire, lander based in tamples made loans and added two
important innovations. They accepted deposit and changed moneys.archaeology
from this perid in ancient china and india also shows evidence of money lending
activity.banking activity were sufficiently important in babylonia in the second
millennium b.c that written standard of practice were considered
necessary.Nevertheless ,some of the basic concepts underlying todays banking
system were present in these ancient arrangements. A wide range of a deposite was
accepted , loans were made, and borrowers paid interest to lander.1

Similar banking type arrangements could also be

found in ancient Egypt.these arrangements
stemmed from the requirement that grain harvests
be stored in centralized state
warehouses.depositers could use written orders for
the withdrawal of a certain quantity of grain as a
means of a payment.this system worked so well
that it continued to exist even after private banks
dealing in coinage and precious metals were
established.2
We can trace modern day banking to practices in
the medival Italian cities of Florence, venice and
genoa.the italin banker made loans to princes,both
to finance wars and their lavish lifestyles,and to
merchants engaged in international trade.in
fact,these early banks tended to be set up by
trading families as a part of their more general
business activity.the bardi and Peruzzi families
were dominate in the 14th century and established
branches in other part of a Europe to a facilitate
their treding activities.3
Both thes bank extanded substantial loans to Edward of englands to finances the
100 year war against france. But Edward defaulted, nad the banks failed.perhaps
the most famous of the medieval Italian banks was the medici bank, set up by
Giovanni medici in 1397.4 The medici had a long history as a money changers, but
it was Giovanni who moved the business form a green covered table in the market
place into the hall of the place he had build to himself.He expanded the scope of the
business and established branches of the bank as far north as a London. While the
medici bank extanded the usual loans to merchants and royals,it also enjoyed th
distinction of being the main banker for the pope. Papal business earned higher
profit for the bank than any of its other activities and was the main driving force
behind the establishment of branches in other Italian cities and across Europe.much
of the international business of the medieval banks was carried out thorough the
use of bills of a exchange.at the simplest, lavel, this involved a creditor providing
local currency to the debtor in return for a bill stating that a certain amount of
another currency was payable at a future date often at the next big international
fair.because of the church prohibition on directly charging interest, the connection
between benking and trade was essential.the banker would take deposite in one
city, make loan to someone transporting goods to other city,and then take
repayment at the destination.the repayment usally in a different currency, so it
could easily incorporate what is essentially an interest payment,circumventingthe
church prohibitions.e.g,a Florentine bank would land 1000 florins in Florence
requiring repayment of 40000 pence to be repaid in Florence at a rate of 36 pence
par floring in 3 month. in six months, the bank makes 11.1 precent thats an annual
rate of 23.4 present. it is also interesting to note that a double entry book keeping
system was used by these medival banker and that payment could be executed
purely by books transfer.5 During the 17 th and 18th centuries the dutch and british
improved upon Italian banking techniques. A key development often credited to the
London goldsmiths around this time was the adoption of fractional reserve
banking.6 By the middle of the 17th century, the civil war had resulted in the
demise of the goldsmithstreditional business of the making object of the gold and
silver.Forced to find a way to make a living and having the means of a safely store
precious metal,they turned to accepting the deposites of precious metal for
safekeeping. The Goldsmith would then issue a receipt for the deposite.at first,
these receipts circulated as a form of money. But euentually, the goldsmiths
realized that since not all of the depositors would demand their gold and silver
simultaneously, they could issue more receipts than they had metal in their
vault.Banks became an integral part of the US economy from the beginning of the
republic. Five year after the declaration of independence, the first chartered bank
was established in Philadelphia in 1781, 7 and by 1794, there were seventeen
more. At first, bank charters could only be obtained through an act of legislation.
But,in 1838. New York adoped the free banking act, which allowed anyone to
angage in banking business as a long as they met certain legal specifications.as
free banking quickly spread to other states, problems associated with the system
soon became apparent. E.g banks incorporated under these state laws had the right
to issue their own bank notes. This led to a multiplicity of note many of which
proved to be worthless in the all too common event of a bank failure.with the civil
war come legislation that provided for a federally chartered system of a banks. This
legislation allowed national bank to issue notes and placed a tax on state issue bank
notes. These national bank notes came with a federal guarantee,which protected
the note holder if the bank failed. This new legislation also brought all banks under
federal supervision. In essence, it laid the foundations of the present day system.

Various type of a Bank:- The various type of bank in

india
1. Retail Bank- Retail bank are probably the bank
youre most familiar with you checking and savings
accounts are held at a retail bank,which focuses on
consumers as customers.
2ommercial Bank- focus on business customers.
Business need checking and savings accounts just like
individuals do, but they also need more complex services.
They might need to accept payments form customers,
rely heavily on lines of credit to manage cash flow, and
they might use letters of credit to do business overseas.
Commercial Bank are classified as a scheduled and
non scheduled bank-
. Scheduled bank-scheduled banks have been included
in the second scheduled of the reserve bank and fulfils
the following three criterian:
. it must have a paid up capital of at least Rs.6lakhs.
.it must fulfil theRBI norms about no activity that may be
determinate to the depositors interests.
.it must to be a corporation.
.Non scheduled Bank:-Non scheduled bank are
exculeded from the second schedule of RBI.The Reserve
Bank does not exercise control over them, but they report
monthly to RBI.
Public sector banks:-
.Majority stake is held by government.
.state bank of india and its associated bank are:-state bank of
Bikaner& jaipur,state bank of Hyderabad, state bank of mysore,
state bank of Patiala, state bank of Travancore.

.Nationalized Bank-These are those commercial bank that

have been nationalized for fulfil the social objectives of
government.
.There are 20 nationalized bank in india.
.These are ass Allahabad bank, bank of Barota, bank of
mharashtra, bank of india, canara bank, central bank of india,
corporative bank,Punjab national bank of india, union bank of
india, united bank of india.
Regional rural banks- these banks have been established
shed to streng than the rural economy.they facilitate the credit
and deposite flow for farmers artisans, lobourers in their limited
local area.
.these bank are joinly owned by the central and state government
along with a sponsor commercial Bank.

Private sector bank-:

.Majority share capital is with private individuals & corporates.
.Old private banks- there are fourteen old private banks
operating in india.
.These banks were not nationalized when other bank were
nationalized in 1969 and 1980.
. These are- catholic Syrian bank ltd, Dhanalakshmi bank ltd,
lakshmi vilas bank ltd,Ratnakar bank ltd, jammu &Kashmir bank
ltd, south indian bank ltd,SBI commercial and international bank
ltd, and and tamilnad mercantile bank ltd
. New private bank-There are seven new rivate bank
functioning in indian economy. These are axis bank ltd,
development credit bank ltd, ICICI bank ltd, induslnd bank ltd,
HDFC bank ltd, Mahindra bank ltd, and yes bank ltd.
.Foreign banks- These banks have their registered head
offices in a foreign country while they oprate their
branches in india.
.They can oprate in india either through wholly owned subsidianes
or through branches.there are 32 foreign bank oprating their
various brenches in india.
Co- operative banks- cooperative banks are those scheduled
banks that are regulation by RBI, Under a cooperative structure to
provide to credit to all categories of business.
.Their ownership structure is unique where like- minded
individuals and companies pool in money together to support
credit facilities to businasses.

3.Investment Banks- Are hel business work in financial

markets. If a business wants to go public or sell debt, they use an
investment bank.

4.Central banks- Manage the monetary system for a

government. E.g, the federal reserve bank is the US central bank
responsible for managing economic activity and supervising
banks

5. Credit union- are similar to banks, but they are not for
profit organization owned by their customers. Credit union ofter
products and services more or less identical to most retail and
commercial banks.

State bank of india-: State bank of india is an indian

multinational public sector banking and financial services
company. It is a government owned corporation with its
headquarters in Mumbai, Maharashtra. As of 2014-15, it had
assets of 20,480 trillion and more than 14,000 branches, including
191 foreign offices spread across 36 countries,making it the
largest banking and financial. Services company in the india by
assets. The company is ranked 232nd on the Fortune Global 500
list of the worlds biggest corporations as of 2016.(6) the bank
traces its ancestry to british india, through the imperial bank of
india, to the founding, in 1806, of the bank of Calcutta, maling it
the oldest commercial bank in the indian subcontinment. Bank of
madras merged in to the other two presidency banks in british
india, bank of Calcutta and bank of Bombay, to form the imperial
bank of india,which in turn become the state bank of india in
1955.(7) 1955, government of india owned the imperial bank of of
india in 1955, with reserve bank of india taking a 60% stake and
renamed it the state bank of india. In 2008, the government took
over the stake held by the reserve bank of india. State bank of
india is a banking behemoth and has 20% market share in
deposite and loans amond indian commercial banks.(8)

History of SBI-:
The roots of the state bank of india lie in the first decade of the
19th century, when the bank of Calcutta, leter renamed the bank
of Bengal, was established on 2 june 1806. The bank of bangal
was one of three presidency banks, the other two being bank of
Bombay and bank of madras. All three presidency banks were
incorporated as join stock companies and were the result of royal
charters. These three bank received the exclusive right to issue
paper currency till 1861 when, with the paper currency act , the
right was taken over by the government of india, the imperial
bank of india renamed a joint stock company but without
government participation. Pursuant to the provision of the state
bank of india act of a 1955, the reserve bank of india, which is
indian central bank ,acquired a controlling interest in the imperial
bank of india. On 1 july 1955, the imperial bank of india became
state bank of india . in 2008, the government of india acquired
the reserve banks of in indias stake in sbi so as to remove any
conflict because the RBI is the countrys banking regulatory
authority. In 1959, the government pass the state bank of india
act. This made SBI subsidiaries of eight that had belonged to
princely states prior to their nationalized and operational take
over between September 1959 and October 1960, which made
eight state bank association of SBI. This acquisition was in tune
with the first five year plan, which prioritized the development of
rular in india. The government integrated these bank into the
state bank of india system to expand its rural outreach. In 1963
SBI merged state bank of Jaipur and state bank of Bikaner. SBI has
acquired local bank in rescues. The first was the bank of bihar,
which SBI acquired in 1969, together with its 28 branches. The
next year SBI acquired national bank of Lahore , which had 24
branches. Five tear later in 1975 SBI acquired in krishnaram
baldeo bank, which has been establised in1916 in Gwalior state,
under the patronage of maharaja madho rao scindia. The bank
had been the Dukan Pichadi, a small moneylender, owned by the
maharaja. The new first manager was jall N. Broacha,a parsi. In
1985,SBI acquired the bank of cochine in kerala, which had 120
branches. The new logo of SBI was the aerial view of the Kankaria
lake in Ahmedabad Gujarat on 1 october 1971 and was desined
by sekhar kammat.there has been perposal to merge all the
associate banks into SBI to create a mega bank and streamline
the group opreations.(9) the first step towards unification
occurred on 13 august 2008 when state bank of saurashtra
merged with SBI, reducing the number of association state bank
from seven or six.On 19 june 2009, the SBI board approved the
absorption of state bank of indore. SBI holds 98.3% in state bank
of indore.(10) the acquisition of state bank of indore added 470
branches to SBIs total assets will approach 10 trillion. The total
assets of SBI and state bank of indore were 9,981,190 millon as of
march 2009. The process of merging of state bank of indore was
completed by april 2010, and the SBI indore brenches started
functioning of SBI branches on 26 Aug 2010.(11) On 7 Oct 2014,
Arundhati bhattacharya became the first women to be appointed
chairperson of the bank.

Operation:- SBI provide a range of banking products through

its network of branches in india and overseas , including products
aimed at non residents Indians [n r I s] .sbi has 14 reginal huds
and 57 zonal offices that are located at important cities
throughout india

DOMESTIC PRESENCE :- SBI has 18,354 branches of india.

(2) In the financial year 2012-13, its revenue was 2,005 trillion out
of which domestic operation contributed to 95.35% of revenue.
Similarly domastic operation contibutrd to 88.37% of total profil
for the same financial year.2
Under the Pradhan mantra jan dhan yojana of financial inclusion
launched by government in august 2014 SBI held 11,300 camps
and opened over 3million account by September which included
2.1 mllion accounts in rural area and 0.88 million account in urban
areas.
International presence:- As of 2014-15 the bank had
191overseas officer spread over36 countries having the largest
presence in foreign market among indian bank.(5) It has branches
in sngarore ,Moscow, Colombo, Dhaka, hong kong, tehra,
Johannesburg, London,los Angeles, male in the Maldives, muscat,
dubai , new York, Osaka, Sydney,and Tokyo. It has offshore
banking unit in the Bahamas and Bahrain, and representive
offices in myanmer and cape town.SBI has 7 retail banking
branches in sigapore. The Canadian subsidiary SBI Canada bank
india also dates to 1982. It has six branches four in the toronoto
area and two in the Vancouver area. SBI operation several foreign
subsidiaries or affliliates.In 1990, it established an offshore bank,
state bank of india. SBI has 15 branches in major cities of the
country including Rodrigues. SBI sri lanka now has three branches
locatrd in Colombo,kandy and Jaffna branches.The Jaffna branches
was opened on 9 september2013. SBI sri lanka, the oldest bank in
sri lanka , celebrated its 150th year in sri lanka on 1 july 2014. In
1982, the established a subsidiary,State bank of india, which now
has ten branches- nine branches in the state of California and one
in Washington,D.C. The 10th branches in opened in
Fremont,California on 28 march 2011. The other eight branches in
California are located in los angeles, artesia, san jose, canoga
park, fresno and Bakersfield. In Nigeria, SBI operates as INNB
bank. This bank began in 1981 as the indo- Nigeria merchant
mank and received permission in 2002 to commence retail
banking, it now has five branches in Nigeria.In Nepal, SBI owns
49% of SBI Nepal ( start bank in Nepal) share with Nepal
government owning the rest and SBI NEPAL has branches
throughout the country in each and every city as banking has
become the major part of daily life for nepaless people. In
Moscow, SBI owns 60% of commercial bank of india, with canara
bank owning the rest. In Indonesia, it owns 76% of PT bank indo
monex. The state bank of india already has a branch in shanghai
and plans to open one in tianijin.(14) In kenya, state bank of india
owns 76% of giro commercial bank, which it acquired for US$8
million in October 2005.(15)
Associate banks:- SBI now has one associate bank,
down from the eight that it originally acquired in 1959. All use the
the state bank of india logo, which is a blue circle,and all use the
state bank of name, followed by the regional
headquartersname:
.State bank of patiala(founded 1917)
.State bank of mysore (founded 1913)
.state bank of Bikaner&Jaipur(founded1963)
.state bank of Travancore(founded 1945)
.state bank of Hyderabad(founded 1941)
.Bharatiya mahila bank(founded 2013)
The banks which are merged are:
The negotiations for merging of 5 associate banks state bank of
Bikaner and Jaipur, state bank of Hyderabad state bank of
mysore, state bank of Patiala and state bankof Travancore and
bharatiya mahila bank by acquire their businesses including
assets and liabilities with SBI online. Started in 2016.(16)(17)
the merger of these six subsidiaries was approved by union
cabinet on 15june 2016.(18) the state bank of india and all its
associate banks are identified by the same blue keyhole logo. The
state bank of india wordmark usually has one started typeface,but
also utilizes other typefaces.

Non- banking subsidiaries:-

A part from its five associate banks,SBI also has the following
non- banking subsidiaries:
.SBI capital markets Ltd
.SBI funds management pvt Ltd
.SBI factors &Commerical services Pvt ltd
.SBI cards &payments services Pvt ltd
.SBI DFHI Ltd.
.SBI life insurance company limited.
.SBI general insurance.
In march 2001,SBI (with 74% of the total capital) joined with BNP
paribas
(with 26% of the remaining capital)to form a joint venture life
insurance company named SBI life insurance company ltd.In
2004, DFHI was founded with its headquars in Mumbai.
Financial performance evalution of SBI
The performance evalution also being made by calculating the
financial ratio. The importance of financial system for economic
development of a country were recognized worldwide as well as in
india.the policy makers which comprise the reserve bank of
india,ministry of finance of related government and financial
sector regulatory entities,have made severable notable efforts to
improve the regulation in this sector. The sector now compare
favorably with banking sector and bank to bank comparison on
the metric like growth, efficiency and profitability and non
performing assets.The two major players of public sector and
rivate sector bank were SBI and ICICI Bank respectively.the main
challenges facing the commercial banks in india are the
disbursement of fund in quality assets or otherwise it leads to
NPA. Secondly efficiency in terms of interest spread,net interest
margin, return on owners equity ratio, thirdly liquidity as to total
assets in investment, advances cash and cash equivalent terms,
fourthly leverage ratio described in the ratio of capital, deposite
to equity ratio. These are base for showing the performance of
SBI.the state bank of india, the countrys oldest bank and a
premier in terms of balance sheet size, number of branches,
market capitalization and profits is today going through a
momentous phase of change and transformation. The two
hundred year old public sector behemoth is today stirring out of
its public sector legacy and moving with an ability to give the
private and foreign banks a run for their money.the bank is
entering into many new businesses with strategic tie-ups-pension
funds, general insurance, custodial services, private equity,mobile
banking, point of sale merchant acquisition, advisory services,
structured product etc, each one of these initiatives having a
huge potential for growth. SBI is forging ahead with innovative
technology and innovating new banking models, to expand its
rural banking base.it also focusing at the top end of the market ,
on wholesale banking capabilities to provide india is growing large
corporate with a complete array of product and services.it is
consolidating its global treasury operations and entering into
structured products and derivative instruments. Today the bank is
the largest provider of infrastructure debt and the largest
arranger of external commercial borrowings in the country. It is
the only indian bank feature in the fortune 500 list. SBI is also
looking at opportunities to gruw in size in india as well as
internationally. It presently has 173 foreign offices in 33 countries
across the globe. It has also seven subsidiaries in india-SBI capital
market, SBICAP securities, SBI DFHI,SBI factors, SBI life, SBI
cards- forming a formidable group in the indian banking scenario.
It is in the process of raising capital for its growth and
consolidating its various holdings.
Growth and development of SBI
It is imperative to know about the financial performance
of SBI from 1990- 91 to 2011- 12 how it reached to the
storm of financial sector reform, together with holdind a
position in he indian banking sector,SBI growth and
development were based on key responsibility areas of
deposite mobilization,credit development,NPA,
productivity.
Deposit mobilization of SBI
Deosite mobilization is a primary function of a commercial bank.
Deposit mobilization by banks playes a key role not only an
important source of funds for banks but also instrumants for
promoting saving and banking habits among people. Deposite are
essential raw material for banking industry. Commercial banks are
expected to make effors in both the rule and regulation.s

References
. Gary dessler-performance evalution are the basic on
which various administrative decision: A Defination.,
.oxfard- Banks pays out on customer order: A definition;
1Davies,G.(1994) A history of money from ancient time
to the present day, Cardiff,UK,University of wales press.
2Davies(1994)op.cit.
3Hoggson,N.F. (1926) banking Through the Age, New
York,Dodd,Mead&company.
4Goldwaite,R.A.(1995) Banks, place and entrepreneurs
in renaissance Florence,Aldershot,Hampshire,Great
Britain,variorum.
5Goldwaite (1995)o.cit.
6Davies (1994) op.cit.
7Klebaner,b,j.(1974) Commercial banking in the united
state : A history., Hinsdale,Illinois,Dryden press.
< f g Fortune Global 500 2016: state bank of
india.CNN,Retrieved 10 october 2016.
< As indians bank wait in fear of the rupee hitting 70 to
the dollar,s here a list of best 1 indian banks revenue.
Ibtime.com(4 september2013). Retrieved on 2013-12-06.
< History of the evalution of the SBI volumes 1,2 and 3
and banking beyond boundaries (penguin,2011)
< ab SBI annual report 2014-15. State bank of india .
Retrieved 14 january 2016.
< Fortune Global 500 list CNN Money. Retrieved 22 july
2016.
< Banking theory on law practice. Tata McGraw-hill
education.p.8.Retriew 4 november 2014.(First 1=missing
(last1= in Authors list.
< SBI accounts of one fifth of countrys loans.
Livemint.com. 25 january 2009. Retrieved 20 August
2010.
< indian bank association. Iba.org.in.23 April
2005.Retrived 21 december 2010.
< business standard (21 june 2010). Approvals for state
bank of indore merger by july:SBI.
< Economic times (26 August 2010) state bank of indore
branches to became SBI units from aug 26 : SBI; The time
of india.
< Arundhati bhattacharya, first woman to head SBI.
< SBI leads in opening bank account under jan dhan
Yojana. The economic time 11 september 2014 .
Retrieved 30 september 2014.
< SBI of set up the branches in chaina Tianjin. Forbes 21
november 2007 Retrieved 16 july 2010.

Review of literature
Poonam Mahajan and et.al (2012)1 empirically
predicts the return on the assets performance of the SBI
in india for year 2005-06 and 2009-10. A Sample for SBI is
taken for this study. Backward stepwise regression on
analysis is used to study the impact of these determinats
on the performance of bank.ROA is taken for the
depended variable, while other variable like spread ratio,
provision and contingencies, non interest income, credit-
deposite ratio, oprating expenses ratio,controlled in the
study. The result reveld the spread, credit deposite ratio,
Non- performing assets,non interest income and provision
and contingencieshave the capacity of predicting the
profitability of SBI.
Sufian Fadzlan (2002)2- examined the internal and
external factor that influenced the performance of bank
oprating in indian banking sector durind in period 2000-
2008. The empirical findings from this study suggest that
credit risk, network embeddedness, oprating expanses,
liquidity and size have statistically significant impact on
the profitability of SBI. However, the impact is not uniform
across bank of different nation.during the period of study,
the empirical findings do not lend support for the limited
from of global advantages hypothesis. Likewise , the
liability of unfamiliamess hyothesisis also rejected, since
the study do not finding significant advantages accruing
to foeign bank from the Asian.
Hitesh Arora and padmassi Arora (2012)3-examined
productivity growth in SBI bank in post liberalization
period from 1991-1992 to 2008-09. Total factor
productivity in india (PSBS) Is computed using hicks-
moorsteen index number as given by O,Donnell (2010).
The paper is perhapsthe first study that focuses
exclusively on productivity in indians PSBs.it also
contrasts productivity growth result for SBI. Result show
that india PSBs have experienced positive productivity
growth since liberalization. The greater technological
progress experienced in NBs ratherthan to the effect to
higher efficiency gains.
Manas kumar Baidya and debabrataMitra(2012)4-
measured and evaluated the technical efficiency of SBI banks
from the cross-section data of the financial year 2009-10 and to
provide ranking of efficiency to bank using to popular data
enevalute analysis modal . CCR and Andersen and Petersen,s
super efficiency modal.the result reveval that average technical
efficiencyof entire sampe is 86.5% . and that only bank are found
to be fullt efficient.so, there is scope of efficiency improved in
SBI. The study is found that bank which are using more lobour
for producting and there service are relatively more inefficient. In
order to improve the efficiency, most of the inefficient bank
should follow the good operating practies of bank SBI.

Subroo Chowdhury (2012)5- In his study, he revealed that

indian banking has witnessed reforms since 1991thus producting
it with operational flexibility and institutional transformation.the
reforms have strengthened the fundamental of the indian banking
sector.still more the resilience of indian banking sector in
withstanding financial crisishas proved its stabilitybeyound doubt.
Deregulation of the indian bank has opened has new avenues of
bankboth in term of outreach and services. While SBI is placed
globally and has to compete with globle standards, it is still
struggling to achieve global standards. The best rated banks in
india are not able to get position with the top bank globally.
Efficiency of the banks in managing its output and input , is thus
of prime importance in deciding the position of the bank.

Ashok k hurana and k anika goyal (2011)6- analised

the financial performance of SBI banks in india 2006-07, they
examined the productivity and efficiency using the trend of
operating cost, cost to income, labour that there is a needn for
increased absorption of enhanced technological capability by
bank of futher argument yield of the bank and this would call for
changes in process and improvement in human resource skills.

Syed I brahim(2011)7- emphasized the operation

performance of SBI in india for period 2000to 2009. The studt
reveals that the performance of SBI has improved the year 2000.
Aggregate deposite share has constant has increased in following
a positive coorelation between demand deposite and time
deposite. SBI is more efficient by maintaining the C-D ratio.
Improvement in investment deposite ratio and share of
precentages of priority sector advance in total credit all these
have made positive impact on operational efficiency as well as
the profitability of bank.

BireshSahooand A nandadeep m andal(2011)8-

evaluate the performance of the SBI during the post transition
period (1997-2005). The productive performance, scale elasticity,
efficiency and capacity utilization parameter are calculate using
Data envelopment analysis. The empirical result calibrated
through these modal are analytic on several front.the positive
trend of the reforms the process is visible through the increase in
technical efficiency over the year of the post transition period.
Finally the empirical finding show a significant defferance
between the technology and the market based hypothiesis.these
result are in line with the distinction between economies of scale
and return scale.

BalaNeetu and kumar sunil (2011)9-examined, How

efficient are SBI. The increasingly popular technique of data
envelopment analysis has been used to compute the efficiency
scores for individual PSBs. Using the cross section data of
financial year 2008-09. The empirical is finding reveal that PSBs
are their output of high label of efficiency which is reflectrd by the
mean efficiency score of 0.890.

Kour(1993)10- studies the trends in profitability in SBI and

examined the factors responsible for the erosion of bank
profitability. She employed trend analysis and ratio analysis for
this purpose.she opserved that the bank needed to focus
attension on the management on the spred,
burden,establishment expenditure, ancillary income and deposite
mobilazationfor improving their profitability. Her result
contradicated the traditional belief that in the post nationalization
period, the profitability of SBI decline mainly due to priority sector
lending and rural banking according to her the social obligation
were not a major drag on bankprofitability. Rather, a default lied
somewhere else,may be in the organizational structure ,fund
management of overall efficiency of banking opration.

Sunil Kumar (2010)11 analised the trends of cost efficiency

and its components across SBI bank during the post deregulation
period spaning from 1992-1993 to 2007-2008. The study also
examines the issue of convergence in cost technical and
allocative efficiencies levels of india PSBs. The empirical result
indicate that deregulation has a positive impact of the cost
efficiency level of SBI.futher technical efficiency of indian bank
industry over the period trend, while allocative efficiency of bank
industry followed and upward industry, the cost inefficiency is
mainly driven by technical inefficiency rather than allocative
inefficiency.

Ramachandran and kavitha (2009)12- analyzed the

importance of improving the profitability performance os banking
sector in recent year, a census study has been adoped by SBI,
period 1 and period 2 by divided the 10 year study into first five
year and last five year. The step-wise multipal regression analysis
was adoped for the study.a analysis of the SBI reveals that in both
the period study, the variable provision and contingencies to total
expanses occupied a prominent place.

References
1 Poonam Mahajan A parna Bhatia and subhash chander,2012-
ROA performance of SBI in india IUP journal of bank management,
pp.22-35.
2.Sufian fazhan(2012)-determination of bank performance in a
developing economy;global business review.vol.13,pp.1-23,2012.
3. Hitesh Arora and padmassi arora(2012)- bank productivity
measurement using hicks-Moorteen indices: evidence from JPSB
international journal of a business vol.13issue 3/4pp.386-407.
4.Manas kumar Baidya and DebabrataMitra(2012)- an analysis of
the technical efficiency of india bank through DEA approach;
international journal of business performance management
.vol.13,issue .pp.341-365
5.Subroto Chowdhury (2012)- Technical efficiencyof indian
commercial bank : an empirical analysis; international journal of
business performane management. Vol. issue pg.450-472
6. Ashok k hurana and k anikagoyal (Feb 2011)-performance of
SBI bank: an analysis: vol;2 issue.2
7. Syed I brahim (may-2011)- operational performance of indian
scheduled commercial bank; an analysis IJBM- international
journal of business management. Vol.6.no.5
8.BireshSahoo and A nadadeep Mandal (2011)- Examining the
performance of bank in india:Post transition period. IUP journal of
bank management. Issue 2;pp,7-31.
9. Bala Neetu and kumar sunil (2011)-How efficient are public
bank operating in india: post reforms period analysis Afro-Asian
journal finance and according vol.2 no(4).Pp.349-368,2011.
10.Kour (1993)-profit and profitability in SBI dee and deep
publication , New delhi,1993.
11.Sunil kumar (march-2010)- Dynamics of cost efficiency in
indian public bank : A post: dereregulation E xperience, paper
Twelfth Annual conference of money and finance in the indian
economy.
12.Ramachandran and K avitha (2009); profitability of the indian
scheduled commercial bank; a case analysis ,IUP journal of bank
management , vol.8,issue -3&4 pp 129-139.
 Needs of a Study
A sea change has taken place in the banking environment since
the inititation of reforms process in 1992-93. The period of littsle
more than a decade witnessed remarketable changes in
perceptions,policies and precties of banks. In the light of
sweeping changes that have taken place in banking polices and
practies during the last eleven year of reform period,its thought
appropriate to evaluate the impact of reform measures on the
efficiency, profitability and overall performance of bank. Through
recently large number of studies evaluating the performance of
bank in the reform period have come up,yet certain important
aspects remain untouched. These study by and large confind to
economic aspect as their performance i.e., profit a lone and socio-
economic dimensions of their working are altogether ignored.
Moreover,in most these studies,analysis is based upon a limited
number of indicators,limited number of year. Therefore,against
the background,it is throught desirable to taken up a
comprehensive study evaluating the SBI and financial
performance measures whether the bank strategy and its
implementation and execution are effectively contributing
towards profitability,liquidity,efficiency and solvency so that bank
can be carried out smoothly ensuring success, growth and bottom
line improvement. Hences the present study seek to make an in-
depth analysis of the performance in the mentioned SBI.

Objectives of study
1.To examine the decadal growth of state bank of india.
2. To analysis the financial performance of bank.
3.to put forth suggestions for improvement of its performance.
4. To assets, test and analysze the financial performance of the
SBI over the period of five year.
5. to analysis the liquidity position of SBI.
6.To measure profitability, liquidity and credit management of SBI.
7. To show the financial stability analysis consists of (profitability
and liquidity).
8. To analysis the balance sheet and income statement.
9. To know overall bank financial performance condition.
10. To undertake the factors which have led to the current
financial performance.
11. To suggest measures,on the basic of the study results, to
improve further the financial performance of the bank under
study.
12. To examine the growth rate, market capitalization and cash
flow posion of bank.

Scope of the study

The scope of the project covers a brief financial
statement analysis of SBI bank from 2013 to 2016 by
using the annual report the SBI for four year. It also
include the study of accounting standards and accounting
polices related to financial statements. The scope of
study includes -:
1. The study covers the financial performance of the SBI.
2. The study is made by making comparison of four year
of it operation.
3. the study covers a aim to reveal where the stands in
respect to liquidity and an effective use of assets.
4. the study Is given the idea to liquidity position of bank.
6- Research Design
6.1 - Research Methodology- The study is based on
secondary data pertaining behaviour of liquidity solvency
and profitability position were collection from the
balancesheet of SBI. The necessary data were obtained
from annual report.
6.2 Nature of data
The data required for the study has been collated from
secondary source and relevant information were taken
from annual reports and internet etc. secondary data
extracted from balance sheet of SBI from year 2013 to
2016.
Comman size balance sheet has been converted to
comman size by converting each item on the assets side
as a percentages of total assets. Similarly each item on
the liabilities side has been converted as a percentages of
liabilities.s
6.3 Tool applied
To have a meaningful analysis of various data collect,
the comman-size balance sheet tool mode used for
analysis and interpretation of the data.
7. limitation for the study
1. The study is based on the secondary data and the limitation of
using the secondary data may affect the result.
2. the secondary data was taken from the annual report the of SBI
bank, it may be possible that the data show in the annual report
may be window dressed which does not show the actual position
of the bank.
3. while computing the percentages and average, the figure have
baan approximated, and as such the totals at the times may not
exactly tally
4. The performance is bank the measured in financial terms and
non financial measurments of performance are not included.
 Profit Loss Account of SBI 2013 to 2016
201 201 201 201
Particulars 2013 2014 2015 2016 3% 4% 5% 6%
Interest 88% 87% 87% 85%
Earned 119655 136351 152397 163685
Other Income 16037 18552 22576 28159 12% 12% 13% 15%
100 100 100 100
Total Income 135692 154903 174973 191844 % % % %
Less:- Expenses
Interest 56% 56% 56% 56%
Expended 75326 87068 97382 106803
Operating 22% 24% 22% 22%
Expenses 29284 35726 38053 41782
Provision and 8% 10% 12% 15%
Countingencie
s 11131 15935 20223 29484
Taxes 5846 5283 6212 3823 4% 3% 3% 2%
Total expenses 121587 144013 161871 181892 90% 93% 93% 95%
Profit after tax 14105 10891 13102 9951 10% 7% 7% 5%

Common Size Balance Sheet as on financial year 2016 to

2013(amount in Cro.)
Particular
Assets 2016 2015 2014 2013
Cash and Balace 1,15,88
with RBI 1,29,629 5.70% 4 5.70% 84956 4.74% 65830
Balace the bank and
Money Call 37838 1.70% 38872 1.90% 47594 2.70% 48990 3
21.10 23.50 22.25 35087 2
Investment 477,097 % 481759 % 398800 % 8
1,463,70 64.80 13,00,0 63.50 67.51 10456 6
Advance 0 % 26 % 1209829 % 17
Gross Block 23,186 1.03% 21,170 1.00% 18919 1.06% 17375 1
less: deprication 13,367 0.59% 12129 0.59% 11203 0.62% 9659 0

Fixed Assets 9,819 0.43% 9042 0.44% 7,716 0.43% 6596 0

Lease Adjustment 0 0.00% 0 0.00% 0 0.00% 0.2 0
Capital work in
progress 570 0.02% 287 0.01% 286 0.01% 409 0
 1,02,21
Other Assets 1,40.408 6.22% 0 5.00% 43,568 2.40% 47892 3
22,59,06 100.00 20,48,0 100.00 100.00 15662 1
Total Asets 1 % 80 % 1792749 % 12

Liabilities capital
17,30,72 76.60 157679 76.99 1,394,40 77.80 12027 7
Deposit 2 % 3 % 9 % 40
10.00 10.20 16918 1
Borrowing 2,24,191 9.40% 205150 % 183,131 % 3
1,37,69
Other Liabilities 159,876 7.10% 8 6.70% 96,927 5.40% 95405 6
21,14,78 93.10 19,19,6 93.69 16,74,46 93.40 14673 9
Total Liabilities 9 % 41 % 7 % 28

capital and reserve

Share of capital 776 0.03% 747 0.00% 747 0.04% 684 0
Total Reserve 1,43,498 6.40% 127,692 6.20% 117536 6.56% 98200 6

1,28,43
Shareholder fund 1,44,274 6.40% 8 6.20% 118,282 6.60% 98884
Total liabilities and 204807 100.00 1,79,274 15662
Capital 2259063 100% 9 % 9 100% 12