Ratio Analysis

Table 1

Table showing the detail of equity capital

Rs.in crores
Particulars 2004 2005 2006 2007 2008 2009

Actual 556.3056 556.3056 259.2378 359.2378 333.5178 333.5178

Trend 100 100 47 65 60 60

Incrementa 1 0 -53 18 -5 0
l

Graph 1

Graph showing the details of equity capital

120
100
80
60
40 Trend
Trend

20
Inc rem ental
0
-20 2004 2005 2006 2007 2008 2009
-40
-60
-80
Ye a rs

Vijaya College 1
Ratio Analysis

Analysis: -

The bank has not issued any substantial equity capital or it has not

taken any amount from the government in the year 2009. The total amount of

capital of Rs. 333.51 core was maintained in the years 2008 & 2009. The

comparatively higher equity capital of the bank was maintained in the years

2004 & 2005 i.e. the total amount of the capital of Rest. 556.31 core in each

year. Comparing to the six-year equity capital the lowest total amount of

capital of Rest. 259.24 Crore was maintained in the year 2006. It was clearly

shown in the trend as well as incremental trend analysis.

Inference: -

The equity capital of a company is not constant and it was marginally

decreasing comparing to 2004 and 2005.

Vijaya College 2
Ratio Analysis

Table: 2

Table showing the detail of Reserves and surplus

Rs.in crores
Particulars 2004 2005 2006 2007 2008 2009

Actual 164.7520 147.7086 187.8409 240.2004 329.5077 477.7523

Trend 100 90 114 146 200 290

Incremental 1 -10 24 32 54 90

Graph 2

Graph showing the details of Reserves and surplus

350
300
250
200
Trend
Trend

150
Incremental
100
50
0
-50 2004 2005 2006 2007 2008 2009
Years

Vijaya College 3
Ratio Analysis

Analysis: -

The above table and graph shows the increase of Reserve and surplus. The

bank maintaining more reserve and surplus in the year 2009 comparing to the

previous year. The bank has maintained comparatively higher reserve and

surplus in the year 2009 i.e. amount to 477.75 cores and the lowest reserve in

the year 2005, which was Rs. 147.7 crores. From then onwards the reserve

and surplus of the bank was increasing. It was clearly shown in the trend as

well as incremental trend analysis.

Inference: -

The maintenance of reserve and surplus of the bank was increasing

over the period of the six years.

Vijaya College 4
Ratio Analysis

Table: 3

Table Showing the detail of Borrowings Rs.in crores

Particulars 2004 2005 2006 2007 2008 2009

Actual 143.7051 146.2527 80.1801 142.2671 88.0709 320.8178

Trend 100 102 56 99 61 223

Incremental 1 2 -46 43 -37 162

Graph 3

Graph showing the details of borrowings

250

200

150

100 Trend
Trend

50 Incremental

0
2004 2005 2006 2007 2008 2009
-50

-100
Years

Vijaya College 5
Ratio Analysis

Analysis: -

Above table shows the details of Borrowing of the bank. This was

143.71 crores in the year 2004 and went up to 320.8 crores. This can be seen

from the trend analysis, which went up 223% in the year 2009. Comparing to

the six year borrowing made by the bank, the lowest borrowing made by this

bank in the year 2006 which was 80.18 crore.

Inference: -

Borrowing of the bank is increasing over the period of six years. The

comparatively highest borrowing was made in the year 2009.

Vijaya College 6
Ratio Analysis

Table: 4

Table Showing the detail of deposit Rs.in crores

Particulars 2004 2005 2006 2007 2008 2009

Actual 8215.819 9690.230 11592.882 12632.241 14680.509 17019.8109

2 1 8 7 8
Trend 100 118 141 153 179 207

Incremental 1 18 23 13 26 28

Graph 4

Graph showing the details of deposit

250

200

150
Series2
Trend

Series1
100

50

0
2004 2005 2006 2007 2008 2009
years

Vijaya College 7
Ratio Analysis

Analysis: -

Deposits of the bank from 2004 to 2009 were continuously increasing.

It was increased to 9690.2 crores in the year 2005 and it further went up to

11592.8 crores in the year 2006. The bank has maintaining more deposit. It

was clearly shown in the trend as well as incremental trend analysis. It was

just 8215.8 crores in the year 2004 and it was increased to 17019.8 crores in

the year 2009.

Inference: -

The growth of the trend over a period of six year is continuously

increasing. The deposit of the bank is increasing

Vijaya College 8
Ratio Analysis

Table: 5

Table showing the detail of other liabilities and provisions Rs.in crores

Particulars 2004 2005 2006 2007 2008 2009

Actual 359.5596 555.1670 671.9551 882.6613 713.1937 927.4696

Trend 100 154 187 245 198 258

Incremental 1 54 33 58 -47 60

Graph 5

Graph showing the details of other liabilities and provisions

300

250

200

150
Trend

Trend
100
Incremental
50

0
2004 2005 2006 2007 2008 2009
-50
-100
Years

Analysis: -

Vijaya College 9
Ratio Analysis

The table shows the details of other liabilities and provisions. The total

size of other liabilities and provisions was Rest 359.6 crores in the year 2004

and it was subsequently increased up to 555.2 crores in the year 2005 and

further it went up to Rest 927.5 crores in the year 2009. The other liabilities

and provisions of bank were fluctuating over the period of six years. It can be

seen in trend as well as incremental trend analysis.

Inference: -

The other liabilities and provisions of the bank were fluctuating over the

period of six year

Table: 6

Table showing the detail of cash and balance with RBI Rs.in crores

Vijaya College 10
Ratio Analysis

Particulars 2004 2005 2006 2007 2008 2009

Actual 919.4495 1153.5723 1236.5965 851.0817 1026.1830 1086.2662

Trend 100 125 134 93 112 118

Incremental 1 25 9 -41 19 6

Graph 6

Graph showing the details of cash and balance with RBI

150

100

Trend
Trend

50
Incremental

0
2004 2005 2006 2007 2008 2009
-50
Years

Analysis: -

From the above information the analysis can be made for cash and

Balance with RBI. It was fluctuating over the period of six years. In the year

Vijaya College 11
Ratio Analysis

2004 it was Rest 919.4 crores and it was subsequently increased up to Rest

1153.6 crores in the year 2005 and further it went up to 1236.6 crores in the

year 2006. The bank has maintained less cash and balance with RBI in the

year 2007 which 851.1 crores. It can be seen in the above trend as well as

incremental trend analysis.

Inference: -

Cash and balance with the RBI of Vijaya bank were fluctuating over the

period of six years. In the year 2009 it was 1086.3 crores.

Table: 7

Table showing the detail of Investment Rs.in crores

Particulars 2004 2005 2006 2007 2008 2009

Actual 3788.0348 4441.1512 5088.8725 5870.1468 7360.7290 8861.6137

Vijaya College 12
Ratio Analysis

Trend 100 117 134 155 194 234

Incremental 1 17 17 21 39 40

Graph 7

Graph showing the details of Investment

250

200

150
Trend

Trend
Incremental
100

50

0
2004 2005 2006 2007 2008 2009
Years

Analysis: -

This table shows the details of investment made by the management

towards the bank. This was Rest 3788.00 crores in the year 2004 and

subsequently it went up to Rs4441.1 crores in the year 2005, further this

Vijaya College 13
Ratio Analysis

increased to the 7360.7 crores in the year 2008. The investment of the bank is

continuously increasing over the period of six Years. This can be clearly seen

in the above graph. In the year 2009 it was Rest 8861.6 crores, which was

comparatively higher.

Inference: -

The investment of Vijaya bank is continuously increasing over the

period of six years. In the year 2009 it was 8861.6 crores.

Table: 8

Table showing the detail of balance with bank and money at call,
short notice
Rs.in
crores
Particulars 2004 2005 2006 2007 2008 2009

Actual 448.3464 406.8030 457.0239 595.6640 629.0536 517.2099

Vijaya College 14
Ratio Analysis

Trend 100 91 102 133 140 115

Incremental 1 -9 11 31 7 -25

Graph 8

Graph showing the details of balance with bank and money at call, short notice

160
140
120
100
80
Trend

Trend
60
Incremental
40
20
0
-20 2004 2005 2006 2007 2008 2009
-40
Years

Analysis: -

From the above graph this can be clearly seen that the balance with

bank and money at call, short notice of Vijaya bank were fluctuating over the

period of six years. It was Rs. 448.3 crores in the year 2004 and it went down

to Rs. 406.8 crores in the year 2005 and it further went up to Rs. 629.0 crores

Vijaya College 15
Ratio Analysis

in the year 2008.This could be clearly shown in the trend and incremental

trend analysis.

Inference: -

The Vijaya bank balance with bank and money at call, short notice is

fluctuating over the period of six years. In the year 2008 it was Rs. 629.1 crore

and it decreased to 517.2 crores in the year 2009 comparing to the previous.

Table: 9

Table showing the detail of advance Rs.in crores

Particulars 2004 2005 2006 2007 2008 2009

Actual 2999.0852 3767.2000 4958.6678 5720.0098 6196.6605 7891.3423

Trend 100 126 165 191 207 263

Incremental 1 26 39 26 16 56

Vijaya College 16
Ratio Analysis

Graph 9

Graph showing the details of advance

300

250

200
Trend

Trend
150
Incremental

100

50

0
2004 2005 2006 2007 2008 2009
Years

Analysis.

The total size of advance was Rest.2999.1Crores in the years 2004

and it was substantially increased to Rs.3767.2crores in the year 2005 and

further it was increased toRs7891.3 crores in the year 2009.The bank

advances is continuously increased over the period the period of six years .It

Vijaya College 17
Ratio Analysis

was clearly shown in the trend as well as incremental trend analysis .It was

just 2999.1crores in the year 2004 and it was increased to Rs7891.3crores in

the year 2009.

Inference:

The bank advances were continuously increasing over the period of six

years. In the year 2009 it was 7891.3 crores which were comparatively high.

Table: 10

Table showing the detail of fixed assets Rs.in crores

Particulars 2004 2005 2006 2007 2008 2009

Actual 172.8951 170.3039 154.4636 150.0228 165.5239 159.3881

Trend 100 99 89 87 96 92

Vijaya College 18
Ratio Analysis

Incremental 1 -5 -10 2 9 -4

Graph 10

Graph showing the details of fixed assets

120

100

80

60
Trend

Trend
40 Incremental

20

0
2004 2005 2006 2007 2008 2009
-20
Years

Analysis: -

Bank investment in the fixed asset was continuously fluctuating over a

period of six years. In the year 2004 the fixed asset total amount was Rs172.9

crores and it was further comparatively decreased to Rs159.4 crores in the

year 2009. This can be seen in the above graph. In the year 2006 the fixed

asset was rs154.5 crores and further it went down to Rs150.0 crores in the

year 2007. This can be seen trend and as well as incremental trend analysis.

Vijaya College 19
Ratio Analysis

Inference: -

The fixed asset of bank is fluctuating over the period of six years. In the

year 2004 it was Rs172.9 crores and in the year 2009 it was Rs159.4 crores.

Table: 11

Table showing the detail of other assets Rs.in crores

Particulars 2004 2005 2006 2007 2008 2009

Actual 1112.3305 1156.6380 896.4724 1069.6832 766.6499 563.5482

Trend 100 104 81 96 69 51

Incremental 1 4 -23 15 -27 -18

Graph 11

Vijaya College 20
Ratio Analysis

Graph showing the details of other assets

120
100

80
60
Trend
Trend

40
Incremental
20
0
2004 2005 2006 2007 2008 2009
-20
-40
Ye a rs

Analysis:-

The above table clearly shows the details of other assets over the

period of six years. In the year 2004 it was Rs1112.3 crores and it was

decreased to Rs896.5 crores in the year 2006 and further it went up to

Rs1069.7 crores in the year 2007. This can be clearly shown in the trend as

well as incremental trend. In the year 2007 the other assets were Rs563.3

crores and its trend is 51% and incremental trend was –80.

Vijaya College 21
Ratio Analysis

Inference: -

The other assets of the bank were decreasing over the period of six

years.

RATIO ANALYSIS:

Table 12

Table showing the details of debt equity ratios Rs in crores

Particulars 2005 2006 2007 2008 2009

External Equity 1150.9 1352. 1425.1 1494.8 1447.1
Debt equity Ratios = 6
Internal Equity 406.9 720.9 881.1 1125.5
= 2.8 312.1 = 2.0 = 1.7 = 1.3
= 4.3

Graph 12

Vijaya College 22
Ratio Analysis

Graph showing the details of debt equity ratios

4
Ratios

3
Ratios
2

0
2005 2006 2007 2008 2009
Years

Analysis: -

As the components of equity were constant in the year 2008 and 2009.

The standard debt to the equity has not been maintained. Debt equity ratios

were continuously decreasing over the period of five years. It was 4.3:1 in the

year 2006 and 2:1 in the year 2007 and in the last year it was 1.3:1 in the year

2009.

Vijaya College 23
Ratio Analysis

Inference: -

The size of debt of Vijaya bank was more and proportionate amount of

equity has not been maintained.

Table 13

Table showing the details of debt net worth Rs in crores

Particulars 2005 2006 2007 2008 2009

External Equity 1150.9 1352. 1425.1 1494.8 1447.1
Debt Net worth = 6
Net worth 704.0 599.4 547.6 792.0
=1.6 447.1 =2.4 =2.7 =1.8

Vijaya College 24
Ratio Analysis

=3.0

Graph 13

Graph showing the details of debt Net worth

3.5
3
2.5
Ratios

2
Ratios
1.5
1
0.5
0
2005 2006 2007 2008 2009
Years

Analysis: -

Debt Net worth indicates the amount of debt and net worth of the bank.

The debt Net worth Ratio of the bank was fluctuating over the period of five

years. It was 1.6 in the year 2005 and 3.0 in the year 2006 and further it gone

down in the year 2008, which was 2.7. In the last year it was 1.8 that is 2009.

Vijaya College 25
Ratio Analysis

Inference: -

Debt Net worth ratio of the bank was fluctuating over the period of five

years.

Table 14

Table showing the details of Expenses Ratio Rs in crores

Particulars 2005 2006 2007 2008 2009

Expenses 310.2 379.5 438.1 421.6 557.0
Expenses Ratio =
Average Advance 3383.1 4362. 5339.3 5958.3 7044
=0.09 9 =0.08 =0.07 =0.08
=0.09

Vijaya College 26
Ratio Analysis

Graph 14

Graph showing the details of Expenses Ratio

0.1
0.09
0.08
0.07
0.06
Ratios

0.05 Series1
0.04
0.03
0.02
0.01
0
2005 2006 2007 2008 2009
Ye ars

Analysis: -

This table shows the details of Expenses ratio. It was just 0.09 in the

year 2005 and even in 2006 it was 0.09. The lower ratio ensures the higher

profitability of the bank. Higher the ratio ensures the lower profitability of the

bank. In the year 2008 it was 0.07, which was comparatively low. In the year

Vijaya College 27
Ratio Analysis

2009 it was 0.08. The expenses ratios of the bank were fluctuating over the

period of 5 years.

Inference: -

The expenses ratio of the bank fluctuating over the period of five years.

Table 15

Table showing the details of Profit before tax to number of employees

ratio Rs in crores
Particulars 2005 2006 2007 2008 2009
PBT 30.2 52.8 70.7 130.9 196.6
PBT to number of employees=
Number of employees 14140 14324 13471 11827 11723
= 0.002 =0.003 =0.005 =0.01 =0.02

Vijaya College 28
Ratio Analysis

Graph 15

Graph showing the details of Profit before tax to number of

employee’s ratio

0.025

0.02

0.015
Ratios

Series1
0.01

0.005

0
2005 2006 2007 2008 2009
Years

Analysis: -

In the year 2005 the profit before tax to number of the employees was

0.002 and in the year 2007 it was 0.003. It was continuously increasing over

the period of 5 years. In the last year 2009 it was 0.02. This can be clearly

shown in the tables. The number of employees is decreasing over the period

of 5 years.

Vijaya College 29
Ratio Analysis

Inference: -

Profit before tax to the number of employee’s ratios of the bank is

continuously increasing.

Table 16

Table showing the details of Profit before tax to interest paid ratio
Rs in crores

Particulars 2005 2006 2007 2008 2009

PBT 30.2 52.8 70.7 130.9 196.6
PBT to interest paid =
Interest paid 682.7 809.3 895.8 1053.0 1027.4
=0.04 =0.07 =0.08 =0.12 =0.19

Graph 16

Vijaya College 30
Ratio Analysis

Graph showing the details of Profit before tax to interest paid

ratio

0.2
0.18
0.16
0.14
0.12
Ratios

0.1 Series1
0.08
0.06
0.04
0.02
0
2005 2006 2007 2008 2009
Years

Analysis: -

This ratio indicates profit before tax to the interest paid. Comparatively

higher ratio was in the year 2009, which was 0.19. In the year 2005 it was just

0.04 and in the year 2006 it was 0.07. The above table clearly shows the

Profit before tax to interest paid ratio were continuously increasing over the

period of five years.

Vijaya College 31
Ratio Analysis

Inference: -

The Profit before tax to interest paid ratio was comparatively higher in

the year 2009, which was 0.19.

Table 17

Table showing the details of Net profit ratio Rs in crores

Particulars 2005 2006 2007 2008 2009

Net profit 30.2 52.8 70.7 130.9 196.5
Net profit ratio =
Average Advance 3383.1 4362. 5339.0 5958.3 7044
=0.009 9 =0.01 =0.02 =0.03
=0.02

Graph 17

Vijaya College 32
Ratio Analysis

Graph showing the details of Net profit ratio

0.035

0.03

0.025

0.02
Ratios

Series1
0.015

0.01

0.005

0
2005 2006 2007 2008 2009
Years

Analysis: -

The ratio indicates the net profit margin of the bank, higher the ratio

higher will be the profit of the bank, lower the ratio lower will be the profit of

the bank. The net profit margin was comparatively higher in the year 2009 that

is 0.03. In the year 2005 the net profit margin was comparatively low which

Vijaya College 33
Ratio Analysis

was 0.009? The net profit margin directly contributes to the growth of the

bank.

Inference: -

The net profit margin of the bank was increasing over the period of five

years. In the year 2009 it was 0.03, which was comparatively high.

Table 18

Table showing the details of Interest expended Ratio Rs in crores

Particulars 2005 2006 2007 2008 2009

Interest expended 683.7 809.4 895.8 1053.2 1027.0
Interest expended Ratio =
Average Advance 3383.1 4362. 5339.0 5958.3 7044
=0.20 9 =0.17 =0.18 =0.14

Vijaya College 34
Ratio Analysis

=0.19

Graph 18

Graph showing the details of Interest expended Ratio

0.25

0.2

0.15
Ratios

Series1
0.1

0.05

0
2005 2006 2007 2008 2009
Years

Analysis.

The ratio indicates the interest expended by the bank. It was just 0.20

in the year 2005 and this was decreased to 0.19 in the year 2006. The highest

interest expended by bank comparing to the five years was in the year 2005

Vijaya College 35
Ratio Analysis

that is 0.20.After this it reduce to 0.17 in the 2007 and 0.18 in the year 2008,

0.14 in the year 2009. Lower ratios indicate more profit where as higher ratio

indicates less profit to the bank.

Inference: -

Interest expended of the Vijaya bank decreasing during the five years.

It was 0.20 in the year 2005 and it was decreased to 0.14 in the year 2009.

Table 19

Table showing the details of other Income ratio Rs in crores

Particulars 2005 2006 2007 2008 2009

Other Income 109.1 116.8 156.3 188.8 346.0
Other Income ratio =
Average Advance 3383.1 4362. 5339.0 5958.3 7044
=0.03 9 =0.03 =0.03 =0.05
=0.03

Vijaya College 36
Ratio Analysis

Graph 19

Graph showing the details of other Income ratio

0 .0 6

0 .0 5

0 .0 4
Ratios

0 .0 3 S e r ie s 1
0 .0 2

0 .0 1

0
2 0 0 52 0 0 62 0 0 72 0 0 82 0 0 9
Y e ars

Analysis: -

This ratio indicates other income of the bank. Higher the ratio higher

will be the profit. Where as lower the ratio lower will be the profit. This ratio is

fluctuating over the period of five years. It was constant in the year 2005,

2006, 2007, and 2008. In the year 2009 other income ratio was 0.05, which is

Vijaya College 37
Ratio Analysis

comparatively higher than the previous years. In the previous years it was

0.03.

Inference: -

The other income ratios of the bank were constant in the four years

that is 0.03 in the years 2005-2008. In the year 2009 it was 0.05, which was

comparatively higher.

Table 20

Table showing the details of Spread ratio Rs in crores

Particulars 2005 2006 2007 2008 2009

Interest Income – Interest Expended 260.5 388.2 460.3 485.3 643.3
Spread ratio =
Average Advance 3383.1 4362. 5339.0 5958.3 7044
=0.08 9 =0.09 =0.08 =0.09
=0.09

Vijaya College 38
Ratio Analysis

Graph 20

Graph showing the details of Spread ratio

0.092
0.09
0.088
0.086
Ratios

0.084
Series1
0.082
0.08
0.078
0.076
0.074
2005 2006 2007 2008 2009
Years

Analysis: -

The above table shows details of spread ratio of five years of the bank.
The spread ratio of the bank is fluctuating over the period of five years.
It was just 0.08 in the year 2005. Then it increased to 0.09 in the year
2006 and it was same in the years 2007, 2009. This was clearly shown
in the above graph.
Inference.

Vijaya College 39
Ratio Analysis

The spread ratio of the bank was fluctuating. It was 0.08 in 2005 and

this went up to 0.09 in the 2009.

Vijaya College 40
Ratio Analysis

Table 21

Table showing the details of Interest Income Ratio Rs in crores

Particulars 2005 2006 2007 2008 2009

Interest Income 999.9 1197. 1356.2 1358.5 1670.8
Interest Income Ratio= 5
Average Advance 3383.1 5339.3 5958.3 7044
=0.30 4362. =0.25 =0.26 =0.24
9
=0.27

Graph 21

Graph showing the details of Interest Income Ratio

0.35

0.3

0.25

0.2
Trend

Series1
0.15

0.1

0.05

0
2005 2006 2007 2008 2009
Years

Vijaya College 41
Ratio Analysis

Analysis –

This ratio indicates how many times the advance has been used to

increase interest income. The maximum usage of advance has been made

only in the year 2005 which was 0.30 and it was come down to 0.27 in the

year 2006. The interest income ratios fluctuating over the period of 5 years. In

the year 2007 it was gone down to 0.24.

Inference

The interest income ratio of Bank fluctuating over the period of 5 years.

In the year 2007 it was 0.25 and in the year 2008 it was 0.26, in the year 2009

it was 0.24.

Vijaya College 42
Ratio Analysis

CHAPTER – 5

SUMMARY OF FINDING AND CONCLUSION

Summary, Finding and Conclusion

1) The equity capital of bank was same in the year 2008 and 2009.

Issue of additional equity or mobilization of funds from the government has

been made in the year 2008 and 2009

2) The ratio of debt equity was decreasing over the period of 5 years.

The rapid change of debt equity ratio was in the year 2006

3) The maintenance of reserves for meeting uncertainty have been

increasing it was just 164.8 Crores in the year 2004 and it was increased to

477.8 Crores in the year 2009.

4) In the year 2009 the borrowings of the bank was 320.8 Crores which

was the highest borrowing comparing to the previous years.

5) The interest burden of the borrowed fund is increasing due to large

amount of debt.

6) Investment of the bank in the year 2009 was 8861.6 Crores. It was

just 3788.0 Crores in 2004. Investment of the bank was increasing over the

period of 6 years.

7) Advances of bank were 2999.1 Crores in the year 2004 and it went up

to 3767.2 Crores in 2005, further it went up to 7891.3 Crores in the year 2009.

Vijaya College 43
Ratio Analysis

8) Interest income ratio of the bank is fluctuating

9) Spread ratio was just 0.08 in the year 2005 and it was increased to

0.39 in the year 2009.

10) Other income of the bank is increasing; it was 0.03 in the year

2005 and went up to 0.05 in 2009.

11) Interest expended ratio of the bank is not fluctuating

12) Net profit ratio of the bank was 0.009 in the year 2005 and has

gone up to 0.12 in the year 2009. Therefore the net profit ratio of the bank is

increasing

13) Expenses ratio of the bank was increased to 0.33 in 2009. It was

0.09 in the year 2005.

14) Deposit of the bank was continuously increasing in the year 2005.

It was 8215.8 crores which was increased to 17019.8 crores in the year 2009.

15) Operating expenses of the bank was just 278.3 crores in the year

2004 and it was 557.0 crores in the year 2009.

Vijaya College 44
Ratio Analysis

CHAPTER – 6

RECOMMENDATIONS AND SUGGESTIONS

Recommendations and Suggestions

1) The government of India should permit the bank to raise further

equity funds either from the Government or from the equity issues. So that it

can reduce the existing ratio debt to equity.

2) As far as possible it is recommended to the management to reduce

the debt. The Co. is addressed to make scientific tax planning techniques and

it has to increase the size of reserve to meet uncertainty

3) The interest burden of the bank is more, hence the management

should use the debt more effectively.

4) Borrowings of the bank is more so it is advisable to management to

reduce borrowings.

5) The profit of the bank is more. This could be achieved more by

increasing operational efficiency.

6) The debt equity ratio should be maintained properly by balancing the

debt and equity.

7) Debt to equity ratio must be maintained at 2:1 level. This could be

done either by reducing the debt or by increasing the equity.

Vijaya College 45
Ratio Analysis

8) Government should allow the bank to function independently

9) The rules regarding mobilization and capital budgeting may be

relaxed to have high operational efficiency

10)The bank should decrease the operating expenses.

11)The bank should increase the interest income. The interest income

of the bank was decreasing over the period of 5 years.

12)The profit of bank is increasing. This could be achieved more by

increasing operational efficiency.

13)Bank should determine the various standard for measurement

through which they can attain its goal.

14)They should make the efficient use of deposit and advance.

15) The other liabilities and provision of the bank is comparatively higher

in the year 2009. It is advisable to the management to decrease the other

liabilities and provisions of the bank.

16) The bank has maintained more reserve and surplus in the year 2009

comparatively high. So it is advisable to the bank to maintain less reserve and

surplus

Vijaya College 46
Ratio Analysis

BIBLIOGRAPHY

1) Prasanna Chandra “Financial Management theory and practice”

Tata Mc Graw hill publishing company Ltd. New Delhi

2) I.M. Pandey “Financial Management” Vikas publishing house Pvt

Ltd.

3) P.V. Kulkarni and B.G. Sathya Prasad “Financial Management”

Himalaya Publishing house.

4) Annual reports of Vijaya Bank.

5) Manager and Staff of Vijaya Bank Sanjayanagar Branch,

Bangalore.

6) www.Goolge.com

7) www.vijayabank.com

8) www.moneycontrol.com

Vijaya College 47
 Ratio Analysis

ANNEXURE

1) Master table of balance sheet A

2) Master table of profit and loss account B

3) Master table of ratio C

MASTER TABLE FOR RATIO ANALYSIS

Particulars 2005 2006 2007 2008 2009

Debt Equity Ratio 2.8 4.3 2.0 1.7 1.3

Debt Net worth 1.6 3.0 2.4 2.7 1.8

Expenses Ratio 0.09 0.09 0.08 0.07 0.08

PBT to number of
employees 0.02 0.003 0.005 0.01 0.02

Net Profit Ratio 0.009 0.02 0.01 0.02 0.03

PBT to Interest paid 0.04 0.07 0.08 0.12 0.19

Expenses Ratio 0.2 0.19 0.17 0.18 0.14

Other Income Ratio 0.03 0.03 0.03 0.03 0.05

Spread Ratio 0.08 0.09 0.09 0.08 0.09

Interest income Ratio 0.30 0.27 0.25 0.26 0.24

MASTER TABLE FOR BALANCE SHEET (Rs in Crore)

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 Ratio Analysis

Particulars Sc 2004 2005 2006 2007 2008 2009

no
Capital 1 556.3 556.3 259.2 359.2 333.5 333.5

Reserves and 2 164.8 147.7 187.8 240.2 329.5 477.8

surplus
Deposit 3 8215.8 9690.2 11592.9 12632. 14680.5 17019.8
2
Borrowings 4 143.7 146.3 80.2 142.3 88.1 320.8

Other liabilities 5 359.5 555.2 672.0 882.7 713.2 927.50

and provisions
Total 9940.5 11095.7 12792.1 14256. 16144.8 19079.4
6
Asset

Cash and balance 6 919.4 1153.6 1236.6 851.1 1026.2 1086.3

with RBI
Balance with Bank 7 448.3 406.8 457.0 595.7 629.1 517.2
and money at call
short notice
Investment 8 3788.0 4441.1 5088.9 5870.1 7360.1 8861.6

Advance 9 2999.1 3767.2 4958.7 5720.0 6196.7 7891.3

Fixed asset 10 172.9 170.3 154.5 1500 165.5 159.30

Other asset 11 1112.3 1156.5 89605 1069.7 766.6 563.5

Total 9440.1 11095.7 12792.1 14256. 16144.8 19097.4

6

Vijaya College 49
 Ratio Analysis

I Income Schedule 2004 2005 2006 2007 2008 2009

s No
Interest Earned 13 810. 999.9 1197. 1356. 1538. 1670.
1 5 2 5 8
Other income 14 81.5 1109. 116.8 156.3 188.8 346.0
1
Total 891. 1109. 1314. 1572. 1727. 2016.
5 1 3 4 3 8
II
Expenditure
Interest Expanded 15 549. 682.7 809.4 895.8 1053. 1027.
6 2 4
Operating expenses 16 278. 310.2 379.5 438.1 421.6 557.0
3
Provisions and 40.4 85.9 72.6 107.8 121.6 235.8
contingences
Total 868. 1078. 1261. 1441. 1596. 1820.
3 8 5 8 4 3
III Profit & Loss
Net profit for the year 23.3 30.2 52.88 70.7 130.9 196.6
6
Transfer for Investment - 17.6 - -
Fluctuation Reserve
Profit/Loss brought - - - 33.0 87.1 117.7
forward 328. 324.0
9
Total - - 52.8 121.5 218.0 314.3
305. 293.9
6
Appropriations
IV Transfer to investment - - 27.6 72.7
Fluctuation Reserve 18.5 3.2 3.6 - - -
Transfer to Statutory - 10.5 17.7 32.7 49.2
Proposed dividend - 5.5 11.9 40.0 40.0
Balance Carved over To - - 33.1 91.9 117.7 150.3
the B/S 324. 297.1
1
Transfer to staff - - - - 2.0
Total - - 52.8 121.5 218.0 314.2
305. 293.9
6

Vijaya College 50
Ratio Analysis

INTERVIEW SCHEDULE

Sir,

I am a student of vijaya College presently doing a project in your

bank about the “Evaluation of financial performance of Commercial Bank”

a case study of Vijaya Bank, towards its requirement. I need some information

regarding the topic. The information collected will be used for academic

purpose only and will be used for academic purpose only and will be kept

confidential

IDENTIFICATION

1) Name of the Manage :

2) Qualification :

3) Designation :

4) Experience :

5) Department :

GROWTH

1) Are you happy with the overall performance of the bank?

Yes No

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Ratio Analysis

2) If your answers is no. to the question No. 1 please specify the

Reasons.

a)______________________________________________________

_______

b)_____________________________________________________________

3) Would you require more freedom to mobilize funds

Yes No

4) If the answer is yes to the above question what relaxation you

request from the Government

5) On what basis is the rate of interest charged. Please tick

Flat rate Balance

Diminishing Any other

6) Do you agree with the increase in investment advance, fixed

asset and other asset?

Yes No

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Ratio Analysis

7) It is advisable for the company to reduce other liabilities

Yes No

8) If the answer is yes for the previous question suggest the

measure to reduce other liabilities.

9) Do you agree with the existing debt net worth ratio of bank

Yes No

10) If the answer is no to the previous question kindly offer your

suggestion to improve the debt net worth ratio

11) What are the reasons for maintaining debt to equity ratio please

specify

1) _____________________________________________________________

2) _____________________________________________________________

12) Do you agree with the existing net profit ratio?

Yes No

13) If the answer is no to the previous question please suggest the

measure to improve that ratio

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Ratio Analysis

14) How do you improve the interest income ratio

15) With increasing competition what new investment have you desired

to counter the competition?

1) 3)

2) 4)

15) What are your suggestions to manage the funds

1) 3)

2) 4)

16) Are you happy with the deposits

Yes No

17) If the answer is no to the previous question please specify the

measures to increase deposits

18) The recovery of Debt ratio of the bank

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Ratio Analysis

Good Average could be improved

19) Opportunities for the growth of the bank

Good difficult to grow

Impossible to grow cannot say

20) Performance of the bank

Good could be improved

Difficult to be improved

21) Any other suggestion to improve the performance of the bank

1)

________________________________________________________

2)

________________________________________________________

Vijaya College 55