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Hi this is chetan tejani And this document is purely base on the data of internal as well external sources and it is my request to all user of this document that please use it for kind purpos thank youFINANCIAL ANALYSIS OF CENTRAL BANK OF INDIAVISION:To emerge as a strong, vibrant and pro-active Bank/Financial Super Market and to positively contribute to the emerging needs of the economy through consistent harmonization of human, financial and technological resources and effective risk control systems.
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FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
VISION
To emerge as a strong, vibrant and pro-active Bank/Financial Super Market and to positively
contribute to the emerging needs of the economy through consistent harmonization of human, financial and technological resources and effective risk control systems.
MISSION To transform the customer banking experience into a
fruitful and enjoyable one. To leverage technology for efficient and effective
delivery of all banking services. To have bouquet of product and services tailor-made
to meet customers aspirations. The pan-India spread of branches across all the state
of the country will be utilized to further the socio
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 1
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
economic objective of the Government of India with emphasis on Financial Inclusion.
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 2
INDUSTRY PROFILE
Chapter 1
HEAD LINES
Introduction Origin of word ‘BANK’ Definition of Bank Traditional Banking Activity Banking system in India Structure of banking in India
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
INDUSTRY PROFILEINDUSTRY PROFILE
While walking in the streets of any town or city you might have
seen some signboards on buildings with names-Canara Bank, Punjab
National Bank, State Bank of India, United Commercial Bank, etc.
What do these names stand for? Did you ever try to know about
them? If you enter any such building you will find some kind of a
business office. You will see some employees sitting behind counters
dealing with visitors standing in front of them. You will find that some
are depositing money at one counter while some are receiving
money at another counter. Behind the counters in the office you will
see tables and chairs occupied by officers. On one side of the office
you will also see a chamber (small partitioned room) where the
manager is sitting with papers on his table.
This is the office of a ‘Bank’.
Let us know in detail about banks and their activities.
You know people earn money to meet their day-to-day
expenses on food, clothing, education of children, housing, etc. They
also need money to meet future expenses on marriage, higher
education of children, house building and other social functions.
These are heavy expenses, which can be met if some money is saved
out of the present income. Saving of money is also necessary for old
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 3
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
age and ill health when it may not be possible for people to work and
earn their living.
The necessity of saving money was felt by people even in olden
days. They used to hoard money in their homes. With this practice,
savings were available for use whenever needed, but it also involved
the risk of loss by theft, robbery and other accidents. Thus, people
were in need of a place where money could be saved safely and
would be available when required. Banks are such places where
people can deposit their savings with the assurance that they will be
able to withdraw money from the deposits whenever required. People
who wish to borrow money for business and other purposes can also
get loans from the banks at reasonable rate of interest.
Bank is a lawful organization, which accepts deposits that
can be withdrawn on demand. It also lends money to
individuals and business houses that need it.
Banks also render many other useful services – like collection of bills,
payment of foreign bills, safe-keeping of jewelery and other valuable
items, certifying the credit-worthiness of business, and so on.
Banks accept deposits from the general public as well as from
the business community. Any one who saves money for future can
deposit his savings in a bank. Businessmen have income from sales
out of which they have to make payment for expenses. They can
keep their earnings from sales safely deposited in banks to meet
their expenses from time to time. Banks give two assurances to the
depositors –
a. Safety of deposit, and
b. Withdrawal of deposit, whenever needed
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 4
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
On deposits, banks give interest, which adds to the original
amount of deposit. It is a great incentive to the depositor. It promotes
saving habits among the public. On the basis of deposits banks also
grant loans and advances to farmers, traders and businessmen for
productive purposes.
Thereby banks contribute to the economic development of the
country and well being of the people in general. Banks also charge
interest on loans. The rate of interest is generally higher than the
rate of interest allowed on deposits. Banks also charge fees for the
various other services, which they render to the business community
and public in general. Interest received on loans and fees charged for
services which exceed the interest allowed on deposits are the main
sources of income for banks from which they meet their
administrative expenses.
The activities carried on by banks are called banking activity.
‘Banking’ as an activity involves acceptance of deposits and lending
or investment of money. It facilitates business activities by providing
money and certain services that help in exchange of goods and
services. Therefore, banking is an important auxiliary to trade. It not
only provides money for the production of goods and services but
also facilitates their exchange between the buyer and seller.
You may be aware that there are laws which regulate the
banking activities in our country. Depositing money in banks and
borrowing from banks are legal transactions. Banks are also under
the control of government. Hence they enjoy the trust and confidence
of people. Also banks depend a great deal on public confidence.
Without public confidence banks cannot survive.
The development of banking in an inevitable precondition for
the healthy and rapid development of the national economic
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 5
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
structure. Banking institutions have contributed much to the
development of the developed countries of the world. Today we can’t
imagine the business world without banking institutions. Banking is
as important as blood in the human body. Due to the development of
banking advances are increased and business activities developing
so it is rightly said, “The development of banking is not only the
root but also the result of the development of the business
world.” After independence, the Indian government also has taken a
series of steps to develop the banking sector. Due to considerable
efforts of the government, today we have a number of banks such as
Reserve Bank of India, State Bank of India, nationalized commercial
banks, Industrial Banks and co-operative banks. India Banks
contribute a lot to the development of agriculture, and trade and
industrial sectors. Even today the banking systems of India possess
certain limitations, but one can’t doubt its important role in the
development of the Indian economy.
Banking sector is the first and most important aspect of the
economic-planning of a nation for the faster and speedy development
of a nation; well-development and advanced banking sector is the
precondition. In the most of developed countries of the world, there is
very close relation between the business activities and banks. It is
quite difficult to think the business activities without the existence in
economy as blood in human body.
Thus, we can say that, there is a noteworthy contribution of
banking sector in the development of various fields such as,
agriculture, industries business activities, transportation and
communication.
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 6
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
The word bank is derived from, the Latin word ‘Bonous’ or ‘Banca’
means a bench. A bank refers to the function of accepting deposits,
lending, repaying the deposited money of demand and functioning an
agent whenever asked for. Now for healthy and rapid development of
any national economical structure, the development of banking is an
inevitable pre-condition.
Some authorities observe that the word bank s originally
derived from the German word ‘bank’ which means a joint stock fund.
This word was Italianized into banco by the German when they were
the rulers of measure part of Italy. This term was again change into
‘banck’ by the French; afterwards, the Britishers converted this term
into ‘ bank’ which has now been universalized. The term bank or
banker is used in almost all countries of the world to denote a
financial institution dealing in money.
There are different views regarding the origin of the term
‘bank’ In ancient Greece and Rome the practice of granting credit
was widely prevalent. The books of the old Sanskrit law giver, Menu,
are full of regulations governing credit. In, past (I) traders (II) ledgers
and (III) goldsmiths performed banking activities. Some experts’
opine that the term, ‘bancus’ or ‘banque’ means ‘bench’, and the
term ‘bank’ comes from these words. Ancient bankers and lenders
used benches in the market place to do their lending business. When
a banker failed in his business, the people broke his benches. The
term, ‘bankrupt’, originated from such events.
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 7
ORIGIN OF WORD BANKORIGIN OF WORD BANK1.11.1
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
A bank is an institution which deals in money. A Bank receives money
in the form of deposits from the public, and lends money for the
development of trade and commerce. Several economists have
defined the term, ‘baking’, in various ways. From various definitions
some of them as follow:
“Banking company is a company, which transects the business
of banking in any state of India.”
Section S (5) of banking company act
1949.
“A ‘bank’ or ‘banker’ is one who, in the ordinary course of his
business, receives money which he repays by honoring the cheques
of persons from whom or on whose account he receives it.”
Hart Pofr.
“Bank is an establishment which makes, to individuals, such
advances of money as may be required and safely made and to
which individuals entrust money which it is not required by them for
use.”
Prof. Kenly
“Banking means where financial transactions of credit are done
and bank means where draft, cheque, or credit paid by order,
deposits of money or currency are accepted or assets, bonds, gold,
silver, bills of exchange or promissory notes are accepted that kind of
persons firms or companies having the place of business.”
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 8
DEFINITION OF BANKDEFINITION OF BANK1.21.2
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
Findlay
sheraze
"Banking business" means the business of receiving money on
current or deposit account, paying and collecting cheques drawn by
or paid in by customers, the making of advances to customers, and
includes such other business as the Authority may prescribe for the
purposes of this Act;
(Banking Act (Singapore), Section 2,
Interpretation)
"banking business" means the business of either or both of the
following:
1. receiving from the general public money on current, deposit,
savings or other similar account repayable on demand or within
less than [3 months] ... or with a period of call or notice of less
than that period;
2. paying or collecting cheques drawn by or paid in by customers
Since the advent of EFTPOS (Electronic Funds Transfer at Point Of
Sale), direct credit, direct debit and internet banking, the cheque has
lost its primacy in most banking systems as a payment instrument.
This has led legal theorists to suggest that the cheque based
definition should be broadened to include financial institutions that
conduct current accounts for customers and enable customers to pay
and be paid by third parties, even if they do not pay and collect
cheques.
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 9
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
Banks act as payment agents by conducting checking or current
accounts for customers, paying cheques drawn by customers on the
bank, and collecting cheques deposited to customers' current
accounts. Banks also enable customer payments via other payment
methods such as telegraphic transfer, EFTPOS, and ATM.
Banks borrow money by accepting funds deposited on current
accounts, by accepting term deposits, and by issuing debt securities
such as banknotes and bonds. Banks lend money by making
advances to customers on current accounts, by making installment
loans, and by investing in marketable debt securities and other forms
of money lending.
Banks provide almost all payment services, and a bank account is
considered indispensable by most businesses, individuals and
governments. Non-banks that provide payment services such as
remittance companies are not normally considered an adequate
substitute for having a bank account.
Banks borrow most funds from households and non-financial
businesses, and lend most funds to households and non-financial
businesses, but non-bank lenders provide a significant and in many
cases adequate substitute for bank loans, and money market funds,
cash management trusts and other non-bank financial institutions in
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 10
TRADITIONAL BANKING ACTIVITIESTRADITIONAL BANKING ACTIVITIES1.31.3
HEAD LINES
First Indian Bank The First Indian Joint Stock Bank Recent History Of Indian Banking
Foundation Phase Expansion phase Consolidation phase Reforms phase
Nationalisation & Public Sector Banking
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
many cases provide an adequate substitute to banks for lending
savings to
In the economic development of a nation banks occupy an important
place. Indian money market comprises both organized as well as
unorganized sectors. The unorganized sectors include money lenders
and indigenous bankers and largely cater to the needs of person
living in villages and small towns. Financial institutions in the
organized sector have grown significantly. Among the institution in
organized sector of the Indian money market commercial banks, Co-
operative banks, regional rural banks, development banks etc.
In 1770, first Indian bank known as Bank of Hindustan was
started and was closed down twenty years later. Later on, the East
India Co. started three presidency banks with government
participation. These were:
Bank of Calcutta – 1806
Bank of Bombay – 1840
Bank of Madras – 1843
Other banks such as
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 11
BANKING SYSTEM IN INDIABANKING SYSTEM IN INDIA1.41.4
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
Allahbad Bank came into existence in 1865
Alliance Bank of simla in 1875.
The first Indian joint stock bank known as Oudh Commercial
Bank was setup in 1880 and Punjab National Bank was launched in
1894. There were as many as 648 commercial banks in India by the
and of 1947 and as many as 161 banks failed during 1913-14. Thus,
there was a great need of an institution to control and regulate
banking in the country. As a result, the RBI was setup in 1935 for
regulating the banks in the country.
A scheme of social control on banks was enforced through
statutory measures with effect from 1-2-1969. The banking industry
saw a revolution after 14 major commercial banks were nationalized
in June, 1982. More than 90 % of the bank deposits came under the
control of the government.
Agricultural Credit Development, Rural Planning and Credit Cell
and Agricultural Refinance and Development Corporation were
combined together to setup national bank for agriculture and rural
development in July, 1982. Later, the Exim Bank and National
Housing Bank were setup in 1984 and 1988 respectively.
RECENT HISTORY OF INDIAN BANKINGRECENT HISTORY OF INDIAN BANKING
Indian banking system, over the years has gone through
various phases after establishment of Reserve Bank of India in 1935
during the British rule, to function as Central Bank of the country.
Earlier to creation of RBI, the central bank functions were being
looked after by the Imperial Bank of India. With the 5-year plan
having acquired an important place after the independence, the
Govt. felt that the private banks may not extend the kind of
cooperation in providing credit support, the economy may need. In
1954 the All India Rural Credit Survey Committee submitted its report
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 12
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
recommending creation of a strong, integrated, State-sponsored,
State-partnered commercial banking institution with an effective
machinery of branches spread all over the country. The
recommendations of this committee led to establishment of first
Public Sector Bank in the name of State Bank of India on July 01,
1955 by acquiring the substantial part of share capital by RBI, of the
then Imperial Bank of India. Similarly during 1956-59, as a result of
re-organization of princely States, the associate banks came into fold
of public sector banking.
Another evaluation of the banking in India was undertaken
during 1966 as the private banks were still not extending the
required support in the form of credit disbursal, more particularly to
the unorganized sector. Each leading industrial house in the country
at that time was closely associated with the promotion and control of
one or more banking companies. The bulk of the deposits collected,
were being deployed in organised sectors of industry and trade, while
the farmers, small entrepreneurs, transporters , professionals and
self-employed had to depend on money lenders who used to exploit
them by charging higher interest rates. In February 1966, a Scheme
of Social Control was set-up whose main function was to periodically
assess the demand for bank credit from various sectors of the
economy to determine the priorities for grant of loans and advances
so as to ensure optimum and efficient utilization of resources. The
scheme however, did not provide any remedy. Though a no. of
branches were opened in rural area but the lending activities of the
private banks were not oriented towards meeting the credit
requirements of the priority/weaker sectors.
On July 19, 1969, the Govt. promulgated Banking Companies
(Acquisition and Transfer of Undertakings) Ordinance 1969 to acquire
14 bigger commercial bank with paid up capital of Rs.28.50
Cr,deposits of Rs.2629 cr, loans of Rs.1813 cr and with 4134
branches accounting for 80% of advances. Subsequently in 1980, 6
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 13
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
more banks were nationalised which brought 91% of the deposits and
84% of the advances in Public Sector Banking. During December
1969, RBI introduced the Lead Bank Scheme on the
recommendations of FK Nariman Committee.
Meanwhile, during 1962 Deposit Insurance Corporation
wasestablished to provide insurance cover to the depositors.
In the post-nationalisation period, there was substantial
increase in the no. of branches opened in rural/semi-urban centres
bringing down the population per bank branch to 12000 appx. During
1976, RRBs were established (on the recommendations of M.
Narasimham Committee report) under the sponsorship and support of
public sector banks as the 3rd component of multi-agency credit
system for agriculture and rural development. The Service Area
Approach was introduced during 1989.
While the 1970s and 1980s saw the high growth rate of branch
banking net-work, the consolidation phase started in late 80s and
more particularly during early 90s, with the submission of report by
the Narasimham Committee on Reforms in Financial Services Sector
during 1991.
In these five decades since independence, banking in India has
evolved through four distinct phases:
Foundation phase can be considered to cover 1950s and 1960s till
the nationalisation of banks in 1969. The focus during this period was
to lay the foundation for a sound banking system in the country. As a
result the phase witnessed the development of neces sary legislative
framework for facilitating re-organisation and consolidation of the
banking system, for meeting the requirement of Indian economy. A
major development was transformation of Imperial Bank of India into
State Bank of India in 1955 and nationalisation of 14 major private
banks during 1969.
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 14
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
Expansion phase had begun in mid-60s but gained momentum
after nationalisation of banks and continued till 1984. A determined
effort was made to make banking facilities available to the masses.
Branch network of the banks was widened at a very fast pace
covering the rural and semi-urban population, which had no access to
banking hitherto. Most importantly, credit flows were guided towards
the priority sectors. However this weakened the lines of supervision
and affected the quality of assets of banks and pressurized their
profitability and brought competitive efficiency of the system at a low
ebb.
Consolidation phase: The phase started in 1985 when a series of
policy initiatives were taken by RBI which saw marked slowdown in
the branch expansion. Attention was paid to improving house-
keeping, customer service, credit management, staff productivity and
profitability of banks. Measures were also taken to reduce the
structural constraints that obstructed the growth of money market.
Reforms phase The macro-economic crisis faced by the country in
1991 paved the way for extensive financial sector reforms which
brought deregulation of interest rates, more competition,
technological changes, prudential guidelines on asset classification
and income recognition, capital adequacy, autonomy packages etc.
BANK NATIONALISATION & PUBLIC SECTOR BANKINGBANK NATIONALISATION & PUBLIC SECTOR BANKING
Organised banking in India is more than two centuries old. Till
1935 all the banks were in private sector and were set up by
individuals and/or industrial houses which collected deposits from
individuals and used them for their own purposes. In the absence of
any regulatory framework, these private owners of banks were at
liberty to use the funds in any manner, they deemed appropriate and
resultantly, the bank failures were frequent.
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 15
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
Move towards State ownership of banks started with the
nationalisation of RBI and passing of Banking Companies Act 1949.
On the recommendations of All India Rural Credit Survey Committee,
SBI Act was enacted in 1955 and Imperial Bank of India was
transferred to SBI. Similarly, the conversion of 8 State-owned banks
(State Bank of Bikaner and State Bank of Jaipur were two separate
banks earlier and merged) into subsidiaries (now associates) of SBI
during 1959 took place. During 1968 the scheme of ‘social control’
was introduced, which was closely followed by nationalisation of 14
major banks in 1969 and another six in 1980.
Keeping in view the objectives of nationalisation, PSBs
undertook expansion of reach and services. Resultantly the number
of branches increased 7 fold (from 8321 to more than 60000 out of
which 58% in rural areas) and no. of people served per branch office
came down from 65000 in 1969 to 10000. Much of this expansion has
taken place in rural and semi-urban areas. The expansion is
significant in terms of geographical distribution. States neglected by
private banks before 1969 have a vast network of public sector
banks. The PSBs including RRBs, acount for 93% of bank offices and
87% of banking system deposits.
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 16
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
Indian banking system comprises of both organized and
unorganized banks. Unorganized banking includes indigenous
bankers and village money lenders. Organized banking includes the
following,
The main four types are:
Reserve bank of India (central bank)
Commercial banks
Co-Operative banks
Development banks
Others are:
Exim banks
Regional rural banks
Land development banks
National Bank for Agriculture and Rural Development
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 17
STRUCURE OF BANKING IN INDIA STRUCURE OF BANKING IN INDIA1.5
HEAD LINES
STRUCTURE OF INDIAN BANKING
Types of Bank
Reserve bank of India (central bank) Foundation of RBI Function of Reserve Bank of India
Commercial banks Public sector banks, Private sector banks Foreign banks.
Co-Operative banks Primary Credit Societies Central Co-operative Banks State Co-operative Banks
Development banks
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
(NABARD)
Industrial Development Bank of India
Small Industrial Development Bank of India
STRUCURE OF BANKING IN INDIASTRUCURE OF BANKING IN INDIA
RRBS: Regional Rural Banks
NABARD: National Bank for Agriculture and Rural Development
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 18
Commercial banks
Development banks
Exim banks
State Co-Operative
banks
RRBS
NABARDForeign
bankIndian Bank
Public Sector
Private Sector
State Bank &It’s
Subsidiary
Nationalized Bank
Reserve Bank of India
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
(1.5.A) Central Bank
A central bank is a special institution which controls and
regulates the entire banking structure of country. It also strives to
maintain monetary stability of the country. It also strives to maintain
monetary stability of the country. Central bank is also the apex bank
of country. Since it functions in the best interest of the country and
making profits is unknown to it, it is entrusted the right to issue
currency notes. No other bank is allowed this right. It operates in
close co-operation with the government for implanting economic
policies, thereby promoting economic development.
The central Bank of our country is Reserve Bank of India. Its
establishment was made by the Reserve Bank of India act in 1935. In
India, any person cannot do the business of banking without getting
the license of Reserve Bank.
THE RESERVE BANK OF INDIA (RBI)THE RESERVE BANK OF INDIA (RBI)
The Reserve Bank of India (RBI, Hindi: भा�रती�य रिरज़र्व बैं�क) is the central
bank of India, was established on April 1, 1935 in accordance with the
provisions of the Reserve Bank of India Act, 1934 [1]. The Central
Office of the Reserve Bank was initially established in Kolkata but was
permanently moved to Mumbai in 1937. Though originally privately
owned, the RBI has been fully owned by the Government of India
since nationalization in 1949.
Dr. Duvvuri Subbarao who succeeded Yaga Venugopal Reddy on
September 2, 2008 is the current Governor of RBI.
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 19
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
The Reserve Bank of India was set up on the recommendations of the
Hilton Young Commission. The commission submitted its report in the
year 1926, though the bank was not set up for nine years.
The Preamble of the Reserve Bank of India describes the basic
functions of the Reserve Bank as to regulate the issue of Bank Notes
and keeping of reserves with a view to securing monetary stability in
India and generally to operate the currency and credit system of the
country to its advantage.
It has 22 regional offices, most of them in state capitals
FOUNDATION OF RBI:FOUNDATION OF RBI:
Manages currency notes of all denominators except one rupee
note
As a banker of Government, state Government, Commercial
and co-operative banks.
Monetary regulations
Regulations on exchange value of rupee.
As a represents Govt. of India in International Monetary India in
International Monetary Fund (IMF)
FUNCTION OF RESERVE BANK OF INDIA: FUNCTION OF RESERVE BANK OF INDIA:
Rule currency notes greater than one rupee.
As a Bank of Government, state Government, commercial and
co-operative banks.
Regulation Monetary
Regulations on exchange value of rupee.
As a delegation of India in IMF (International monetary
Federation)
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 20
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
(1.5.B) Commercial Banks
Commercial banks accept money from the public and arrange
for their productive use. They also carry out carry out lending of
money to meet the needs of traders and business houses. The
accepted deposits are always repayable on demand or on short
notice. Commercial banks provide only short-term loans to trade and
industry. Besides this, they also provide working capital finance, and
also provide a number of subsidiary services.
Commercial Banks are banking institutions that accept deposits
and grant short-term loans and advances to their customers. In
addition to giving short-term loans, commercial banks also give
medium-term and long-term loan to business enterprises.
Now-a-days some of the commercial banks are also providing
housing loan on a long-term basis to individuals. There are also many
other functions of commercial banks, which are discussed later in this
lesson.
Types of Commercial banks:
Commercial banks are of three types
Public sector banks,
Private sector banks
Foreign banks.
Public Sector Banks: These are banks where majority stake is
held by the Government of India or Reserve Bank of India.
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 21
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
Examples of public sector banks are: State Bank of India, Corporation
Bank, Bank of Boroda and Dena Bank, etc.
Private Sectors Banks: In case of private sector banks majority
of share capital of the bank is held by private individuals. These
banks are registered as companies with limited liability. For example:
The Jammu and Kashmir Bank Ltd., Bank of Rajasthan Ltd.,
Development Credit Bank Ltd, Lord Krishna Bank Ltd., Bharat
Overseas Bank Ltd., Global Trust Bank, Vysya Bank, etc.
Foreign Banks: These banks are registered and have their
headquarters in a foreign country but operate their branches in our
country. Some of the foreign banks operating in our country are Hong
Kong and Shanghai Banking Corporation (HSBC), Citibank, American
Express Bank, Standard & Chartered Bank, Grindlay’s Bank, etc. The
number of foreign banks operating in our country has increased since
the financial sector reforms of 1991.
STATE BANK OF INDIA (SBI)STATE BANK OF INDIA (SBI)
In 1955, the imperial bank of India was nationalized and
renamed as State Bank of India. Today it is largest bank of India. As a
commercial bank and views pointing to branches, it is world’s largest
bank with 10,836 Branches.
Subsidiary Bank of SBI
State Bank of Bikaner and Jaipur
State Bank of Hyderabad
State Bank of Mysore
State Bank of Indore
State Bank of Pateyala
State Bank Of Saurashtra
State Bank of Travancore
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 22
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
NATIONALIZED BANKS:NATIONALIZED BANKS:
Following 14 commercial banks were nationalized on the 19th July,
1969.
Bank of India
Canara Bank
Central Bank of India
Corporation bank
Indian Bank
Indian overseas bank
Syndicate Bank
UCO Bank
Allahabad Bank
Bank of Baroda
Bank of Maharashtra
Dena Bank
Oriental Bank of Commerce
Punjab & Sind Bank
Union Bank of India
United Bank of India
Vijaya Bank
IDBI Bank
Other six banks were nationalized on the 10th April, 1980.
State Bank of Bikaner and Jaipur
State Bank of Hyderabad
State Bank of Mysore
State Bank of Indore
State Bank of Pateyala
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 23
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
State Bank Of Saurashtra
State Bank of Travancore
In October 1993, the New Bank of Indian and Punjab National
Bank were merged.
PRIVATE SECTOR BANKS: PRIVATE SECTOR BANKS:
HDFC Bank
ICICI Bank
Federal Bank
ING Vysya Bank
Axis Bank (formerly UTI Bank)
Yes Bank
Bank of Rajasthan
Bharat Overseas Bank
Catholic Syrian Bank
Centurion Bank of Punjab
City Union Bank
Development Credit Bank
Dhanalakshmi Bank
Ganesh Bank of Kurundwad
IndusInd Bank
Jammu & Kashmir Bank
Karnataka Bank Limited
Karur Vysya Bank
Kotak Mahindra Bank
Lakshmi Vilas Bank
Nainital Bank
Ratnakar Bank
SBI Commercial and International Bank
South Indian Bank
Amazing Mercantile Bank
Punjab National Bank
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 24
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
Rupee Bank
Saraswat Bank
Tamilnad Mercantile Bank
Thane Janata Sahakari Bank
Bassein Catholic Bank
(1.5.C) Co-Operative Bank
The short-term financial needs of farmers are met by co-
operative banks. Agriculturists, petty farmers and artisans organize
themselves on co-operative principle and form co-operative societies
and banks. Co-operative banks raise funds through various means,
besides receiving all kinds of deposits to make them available as lend
able funds to its members. In India, developed co-operative banks
supply finance for agriculture and non-agriculture activities.
People who come together to jointly serve their common interest
often form a co-operative society under the Co-operative Societies
Act. When a co-operative society engages itself in banking business it
is called a Co-operative Bank. The society has to obtain a licence
from the Reserve Bank of India before starting banking business. Any
co-operative bank as a society is to function under the overall
supervision of the Registrar, Co-operative Societies of the State.
As regards banking business, the society must follow the guidelines
set and issued by the Reserve Bank of India.
Types of Co-operative Banks
There are three types of co-operative banks operating in our country.
They are primary credit societies, central co-operative banks and
state co-operative banks. These banks are organized at three levels,
village or town level, district level and state level.
Primary Credit Societies: These are formed at the village or
town level with borrower and non-borrower members residing in one
locality. The operations of each society are restricted to a small area
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 25
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
so that the members know each other and are able to watch over the
activities of all members to prevent frauds.
Central Co-operative Banks: These banks operate at the
district level having some of the primary credit societies belonging to
the same district as their members. These banks provide loans to
their members (i.e., primary credit societies) and function as a link
between the primary credit societies and state co-operative banks.
State Co-operative Banks: These are the apex (highest level)
co-operative banks in all the states of the country. They mobilise
funds and help in its proper channelisation among various sectors.
The money reaches the individual borrowers from the state co-
operative banks through the central co-operative banks and the
primary credit societies.
SCHEDULED URBAN CO-OPERATIVE BANKSSCHEDULED URBAN CO-OPERATIVE BANKS
List of Scheduled Urban Co-operative Bank as on 31-3-2009 as per
RBI
Bank Main Location
Ahmedabad Mercantile Co-Op Bank Ltd. AhmedabadKalupur Commercial Co-op Bank Ltd. KalupurMadhavpura Mercantile Co-Op Bank Ltd. MadhavpurMehsana Urban Co-Op Bank Ltd. MehsanaNutan Nagarik Sahakari Bank Ltd. AhmedabadRajkot Nagrik Sahakari Bank Ltd. RajkotSardar Bhiladwala Pardi Peoples Co-op Bank Ltd. BulsarSurat Peoples Co-op Bank Ltd. SuratAmanath Co-operative Bank Ltd. BangaloreAndhra Pradesh Mahesh Co-Op Urban Bank Ltd. Andhra PradeshCharminar Co-op. Urban Bank Ltd. HyderabadVasavi Co-op Urban Bank LImited. HyderabadIndian Mercantile Co-op Bank Ltd. LucknowKallappanna Awade Ichalkaranji Janata Sahakari Bank Ltd. IchalkaranjiAbhyudaya Co-operative Bank Ltd. MumbaiBangalore city co-operative bank. BengaluruBassein Catholic Co-operative Bank Limited. VasaiBharat Co-operative Bank (Mumbai) Ltd. Mumbai
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 26
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
Bharati Sahakari Bank Limited. PuneBombay Mercantile Co-operative Bank Limited. MumbaiCitizen Credit Co-operative Bank Ltd. DadarCosmos Co-operative Urban Bank Ltd. PuneDombivli Nagari Sahakari Bank Ltd. DombivliGoa Urban Co-operative Bank Limited. GoaGreater Bombay Co-operative Bank Limited. MumbaiJalgaon Janata Sahakari Bank Ltd. JalgaonJanakalyan Sahakari Bank Ltd. MumbaiJanalaxmi Co-operative Bank Ltd. MumbaiJanata Sahakari Bank Ltd. PuneThe Karnataka State Co-Operative Apex Bank Ltd BengaluruKalyan Janata Sahakari Bank Ltd. KalyanKarad Urban Co-operative Bank Ltd. KaradMahanagar Co-operative Bank Ltd. MumbaiMapusa Urban Co-operative Bank of Goa Ltd. MapusaNagar Urban Co-operative Bank Ltd. AhmednagarNasik Merchant's Co-operative Bank Ltd. NasikNew India Co-operative Bank Ltd. MumbaiNKGSB Co-operative Bank Ltd. MumbaiParsik Janata Sahakari Bank Ltd. ThanePravara Sahakari Bank Ltd. AhmednagarPunjab & Maharashtra Co-operative Bank Ltd. MumbaiRupee Co-operative Bank Ltd. PuneSangli Urban Co-operative Bank Ltd. SangliSaraswat Co-operative Bank Ltd. MumbaiShamrao Vithal Co-operative Bank Ltd. MumbaiSolapur Janata Sahakari Bank Ltd. SolapurThane Bharat Sahakari Bank Ltd. ThaneThane Janata Sahakari Bank Ltd. ThaneThe Kapol Co-operative Bank Ltd. MumbaiZoroastrian Co-operative Bank Ltd. MumbaiNagpur Nagrik Sahakari Bank Ltd. NagpurShikshak Sahakari Bank Ltd. NagpurThe Akola Janata Com.Co-operative Bank Ltd. AkolaThe Akola Urban Co-operative Bank Ltd. AkolaThe Khamgaon Urban Co-operative Bank Ltd. Khamgaon
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 27
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
(1.5.D) Specialised Banks
There are some banks, which cater to the requirements and provide
overall support for setting up business in specific areas of activity.
EXIM Bank, SIDBI and NABARD are examples of such banks. They
engage themselves in some specific area or activity and thus, are
called
specialised banks. Let us know about them.
Export Import Bank of India (EXIM Bank): If you want to set up a
business for exporting products abroad or importing products from
foreign countries for sale in our country, EXIM bank can provide you
the required support and assistance. The bank grants loans to
exporters and importers and also provides information about the
international market. It gives guidance about the opportunities for
export or import, the risks involved in it and the competition to be
faced, etc.
Small Industries Development Bank of India (SIDBI): If you
want to establish a small-scale business unit or industry, loan on easy
terms can be available through SIDBI. It also finances modernisation
of small-scale industrial units, use of new technology and market
activities. The aim and focus of SIDBI is to promote, finance and
develop small-scale industries.
National Bank for Agricultural and Rural Development
(NABARD): It is a central or apex institution for financing agricultural
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 28
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
and rural sectors. If a person is engaged in agriculture or other
activities like handloom weaving, fishing, etc. NABARD can provide
credit, both short-term and long-term, through regional rural banks. It
provides financial assistance, especially, to co-operative credit, in the
field of agriculture, small-scale industries, cottage and village
industries handicrafts and allied economic activities in rural areas.
(1.5.E) Exchange Banks
There is a difference in financing of foreign trade and financing
of internal trade. Generally a person carrying on international trade
requires foreign currencies to meet his obligations. It is here that
exchange banks play the role of financing the dealer for setting
transactions involved in foreign trade. Though commercial banks
undertake financing international trade, there are specialized banks
for foreign exchange business. In India, there is the Export-Import
Bank (EXIM).
(1.5.F) Investment or Industrial Banks
Investment banks provide long-term credit to industries. They
raise their funds by way of share capital, debentures, and long-term
deposits from the public. They also raise funds by the issue of bonds
for business corporations and government agencies. Usually they
underwrite the fresh issue of shares and debentures of companies.
Such banks also buy the entire issue of new securities of public
limited companies and try to get them subscribed at a higher price
by the public.
(1.5.G) Land Development Banks
Land development banks were earlier known as land mortgage
banks. In India, there are a limited number of such banks. They are
special institutions providing long-term loans to agriculturists and
farmers. They provide loans on the security of land and other
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 29
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
immovable properties. They supply long-term funds for period
exceeding six years. Agriculturists and farmers need such funds for
making permanent improvements to land and for buying farming
machinery and equipment.
(1.5.H) Rural Bank
Rural Bank provides various advance facilities for
manufacturing activities such as business, industry, and for the aim
of rural economic development, the Rural Bank Act is passed in 1974.
Rural Bank has given major contribution in the development of rural
area.
(1.5.I) Saving Banks
Saving banks are specialized institutions which encourage the
general public to save something from their earnings. In other words,
such banks pool the small saving s of the lower and middle income
sections of society. They are not banks in the true sense of the term
and their main aim is to promote and collect the savings of the
public. Not only the depositors are given interest, but they are
allowed to withdraw in times of needs. The numbers of withdrawals
are, however, restricted. Separate savings banks are organized in
various nations. The government can also run a savings bank. In
India, the Postal Department runs the Postal Saving Bank all over the
country.
(1.5.J) Deposit Bank V/s Mixed Banks
The main function of a commercial bank is to accept deposits
from the public and lend them to traders, industrialists and others for
period not exceeding one year. The loans and advances provided for
a short period are meant to supplement the working capital of trade
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 30
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
and industry in times of need. This type of banking of attracting and
accepting deposits and then lending for short period is known as
deposit banking. Banks which follow such a system are called deposit
banks.
(1.6.A) General Bank’s Function
Principal Function:
Accounting Deposits
Granting Advances
Ancillary Function:
Discounting of Bills & Cheques.
Collection of Bills & Cheques.
Remittance.
Safe Custody of Articles.
Safe Deposit Lockers.
Conducting:
Safe Deposit lockers
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 31
FUNCTION OF BANK FUNCTION OF BANK1.6
HEAD LINES
General Bank’s Function Principal Function Ancillary Function:
Function of the Commercial Bank primary functions subsidiary functions
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
Issue of :
Letters of credit.
Guarantees.
(1.6.B) Function of the Commercial Bank
Central Bank of India was the first Indian commercial bank
which was wholly owned and managed by Indians. So the main
function of the commercial bank is as follow:
The functions of commercial banks are of two types.
(A) Primary functions; and
(B) Secondary functions.
Let us discuss details about these functions.
PRIMARY FUNCTIONS
The primary functions of a commercial bank include:
a) Accepting deposits; and
b) Granting loans and advances.
Accepting deposits
The most important activity of a commercial bank is to mobilize
deposits from the public. People who have surplus income and
savings find it convenient to deposit the amounts with banks.
Depending upon the nature of deposits, funds deposited with bank
also earn interest. Thus, deposits with the bank grow along with the
interest earned. If the rate of interest is higher, public are motivated
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 32
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
to deposit more funds with the bank. There is also safety of funds
deposited with the bank.
Grant of loans and advances
The second important function of a commercial bank is to grant loans
and advances. Such loans and advances are given to members of the
public and to the business community at a higher rate of interest
than allowed by banks on various deposit accounts. The rate of
interest charged on loans and advances varies according to the
purpose and period of loan and also the mode of repayment.
i) Loans
A loan is granted for a specific time period. Generally commercial
banks provide short-term loans. But term loans, i.e., loans for more
than a year may also be granted. The borrower may be given the
entire amount in lump sum or in instalments. Loans are generally
granted against the security of certain assets. A loan is normally
repaid in instalments. However, it may also be repaid in lump sum.
ii) Advances
An advance is a credit facility provided by the bank to its customers.
It differs from loan in the sense that loans may be granted for longer
period, but advances are normally granted for a short period of time.
Further the purpose of granting advances is to meet the day-to-day
requirements of business. The rate of interest charged on advances
varies from bank to bank.
Interest is charged only on the amount withdrawn and not on the
sanctioned amount.
Types of Advances
Banks grant short-term financial assistance by way of cash credit,
overdraft and bill discounting.
Let us learn about these.
a) Cash Credit
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 33
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
Cash credit is an arrangement whereby the bank allows the
borrower to draw amount up to a specified limit. The amount is
credited to the account of the customer. The customer can
withdraw this amount as and when he requires. Interest is charged
on the amount actually withdrawn. Cash Credit is granted as per
terms and conditions agreed with the customers.
b) Overdraft
Overdraft is also a credit facility granted by bank. A customer who
has a current account with the bank is allowed to withdraw more
than the amount of credit balance in his account. It is a temporary
arrangement. Overdraft facility with a specified limit may be
allowed either on the security of assets, or on personal security, or
both.
c) Discounting of Bills
Banks provide short-term finance by discounting bills, that is,
making payment of the amount before the due date of the bills
after deducting a certain rate of discount. The party gets the funds
without waiting for the date of maturity of the bills. In case any bill
is dishonoured on the due date, the bank can recover the amount
from the customer.
SECONDARY FUNCTION
The subsidiary functions of a commercial bank constitute the
agency services and the miscellaneous services.
Agency Services:-
One of the important functions of a banker is the services
performed by him as an agent. The services as an agent are as
under:
Collection of Interest and Dividend: The bank collects
interest or dividend as and when earned by the customers from
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 34
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
securities. A very small charge is levied for the collection on
behalf of the customer.
Collection and payment: Commercial banks also collect and
pay cheques, bills and promissory notes.
Executing standing orders: A customer may leave standing
instructions to a banker to make payments to certain
individuals or institutions against his account. The banker
usually charges small fees for such services.
Buying and selling of Securities: A commercial baker also
undertakes to purchase or sell stocks or shares on behalf of his
customers.
Remittance of Funds: It is convenient for banks to transfer
funds as they have a network of branches all over the country.
The remittance of funds is done by mail transfer, telegraphic
transfer, and bank draft.
Miscellaneous Services: -
Among the various function when they are many general utility
personal or miscellaneous services rendered to the customers. The
important ones are as under:
Safety of Customer’s valuable: This is undertaken when
they are kept in specially constructed rooms in the bank
premises. Here the bank acts as a bailee of the goods as it is
entrusted to its safe keeping. Usually there are two methods of
ensuring safety of customers’ valuable. One is the acceptance
of valuables ( e.g. documents of title, jeweler etc.) for safe
custody, and the other is the provision of safe deposit vault
(Lockers) on hire to customers.
Foreign Exchange: Commercial banks also deal in foreign
exchange transactions. They assist in foreign trade by
discounting foreign bills of exchange and sometime even have
to arrange transport, insurance and warehousing of goods.
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 35
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
Letters of Credit: A commercial bank can issue personal and
commercial letters of credit, enabling the customer to profit by
the superior credit.
Bankers as Referee: Commercial bankers certify the
respectability and financial standing of their customers. This
service benefits businessmen who deal with the bank’s
customers.
Underwriting: - Banks often act as underwriters to local and
municipal authorities or other public bodies. Banks also
underwrite for companies, corporations, and underwrite issues
of Govt. loans, raised by municipal authorities, and industrial
securities.
Information & Statistics: - Several big banks have started
the collection of information related to trade and business and
provide the same to its customers. Some banks even publish
monthly reviews containing financial and economic information.
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 36
Chapter 2
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
COMPANY PROFILECOMPANY PROFILE
The Bank of India was started on 21st December 1911 under the
name of the Central Bank of India by it’s under Shrwashrio Sir
Soharabji Pochhandwala. This bank suffered great State Bank in year
1913-1914 due to 1st World War or its effect on a monetary system.
It is really a pleasure to note “The Central Bank of India is the
only bank with first manages which was established by Indian
management. Then again in the year 1925-29 Bank had suffered
another set back by its enemy & specially the English cruel.
Customer of his bank started with drawing the deposits and again it
was Sir Pochhandwala personally set on the counters and paid the
deposits to the customer by managing the funds by his own Personal
Prestige. The banks payment counters were kept open for 24 hours
throughout the country and payment were made continuously. This
very bold step of Sir Pochhandwala Sahib created new faith amongst
of the customers of the bank once again proved that this mighty
Bank is the only bank of the Common people of India.
In Gujarat Central Bank first branch was opened at Gandhi Road,
Ahmedabad. During year 1930 to the date of nationalization of the
banking industries, this bank stood as number one in all India during
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 37
COMPANY PROFILE
HISTORY OF THE CENTRAL BANK OF INDIAHISTORY OF THE CENTRAL BANK OF INDIA2.12.1
HEAD LINES
Establishment of Bank Establishment of Bank in Gujarat Growth chart of bank Total branches of bank History of the Central Bank of India at Lal Darwaa, Surat
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
Nationalization of the Bank on dated 19th July 1969. As on 1st February
the total branches of the Central Bank of India through out of country
is 2848 out of which 1397 branches are rural whereas 644 branches
are in semi urban and 419 branches are functioning at urban center
and 621 branches are spread over in metro.
The total deposits of the bank as on above dated was Rs. 9932
Crore out of which 2036 Crore are in current a/c, 2714 are in saving
and 5172 are in time deposits.
A number of innovative and unique banking activities have
been launched by Central Bank of India and a brief mention of some
of its pioneering services are as under:
1911 First Indian Bank in True sense-established
1921 Introduction to the home saving safe deposit scheme to
build saving / thrift habit in all section of the society.
1923 Advance to industry by allotting shares, commercial
banking stated of initial stage.
1924 Landing Section introduced encourages habit to save
money by ladies.
1926 First ever in India safe deposit vault started at Head
Office Bomaby.
1927 Cheque system stated in home saving.
1929 To own and to assist the bank Tally Executive of Trusty
Co. Ltd. Established.
1931 First ever by any Indian banker-Overseas Branch at
London opened. Three years cash certificates issued.
Travelers’ cheque system in rupee currency started.
Indian banker sent abroad to study advance banking.
1932 To reserve deposits rights deposit benefits insurance co.
Ltd. Started.
1970 Recurring deposit scheme established.
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 38
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
Subsequently even after the nationalization of the Bank in the
year 1969, Central Bank continued to introduce a number of
innovative banking services as under:-
1976 The Merchant Banking Cell was established.
1978 New facility for Customer Deposit Cash in any of 14
selected after of the country.
1980 Central card, the credit card of the Bank was introduced.
1985 For speedy Customers Services Automex Started. All
Regional Officer connected with the by own Secret-
national debtor too.
1986 Platinum deposit special scheme in Platinum Jubilee
Year for Long Term Deposit started. Central Card
Scheme expanded which crossed the territorial
boundary of the country central card which is a boon for
Indians going abroad.
1989 The housing subsidiary Cent Bank Home Finance Ltd.
was started with it does headquarter at Bhopal in
Madhya Pradesh.
1994 Quick Cheque Collection Service (QCC) & Express
Service was set up to enable speedy collection of
outstation cheques.
Further in line with the guidelines from Reserve Bank of India
as also the Government of India, Central Bank has been playing an
increasingly active role in promoting the key thrust areas of
agriculture, small scale industries as also medium and large
industries. The Bank also introduced a number of Self Employment
Schemes to promote employment among the educated youth.
Among the Public Sector Banks, Central Bank of India can be
truly described as an All India Bank, due to distribution of its large
network in 27 out of 28 States as also in 4 out of 7 Union Territories
in India. Central Bank of India holds a very prominent place among
the Public Sector Banks on account of its network of 3541 branches
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 39
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
and 218 extension counters at various centres throughout the length
and breadth of the country.
In view of its large network of branches as also number of
savings and other innovative services offered, the total customer
base of the Bank at over 25 million account holders is one of the
largest in the banking industry.
Customers' confidence in Central Bank of India's wide ranging
services can very well be judged from the list of major corporate
clients such as ICICI, IDBI, UTI, LIC, HDFC as also almost all major
corporate houses in the country
HEAD OFFICE OR REGISTERED OFFICE OF CBI:
Chandar Mukh,
Narimpoint,
Mumbai-400021
ZONAL OFFICE OF CBI IN GUJARAT:
Zonal office,
Central Bank Building,
Lal Darwaza, Ahmedabad-390 001
Phone: - 5503586 Fax:- 5505995
Website: www.Centralbankofindia.co.in,
Email: - [email protected]
BRANCHES OF THE CBI IN GUJARAT:
City NameComputerize
dBranches
Non-Computerize
dBranches
Total No of Branches
Ahmedabad 42 16 58Anand 24 13 37Baroda 19 14 33Jamnagar 28 6 34Rajkot 17 10 27Surat 23 9 32
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 40
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
Total: 153 68 221
The branch of the Central Bank of India at Lal-Darwaja was
established on dated 17th May, 1964 by Shri Dahyabhai Karshanji
Kosmada. In Surat city ago 45 years there was very few banks. So
this time there was not any bank near to this area. So people of this
area feel difficulty for banking transaction, if people want to transact
with bank then they went vent far away. This all difficulty understood
by Shri Dahyabhai Karshanji Kosmada and he had to decide to
establish the bank at Lal-Darwaja. The branch was established on
dated 17th May, 1964. When bank was stated that time it had not any
computer system all work of the bank was done manually. After 33
year the bank was made fully computerized on dated 25th January,
1999. Then after bank is well settle.
ADDRESS OF THE BRANCH:
The Central Bank of India (B.O),
Lal Darwaja,
Nr. Resham Bhavan,
Surat -395003. (Guj.)
Phone: - 0261- 2423145, 2428854, 2457038
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 41
HISTORY OF THE CBI AT LALDARWAJAHISTORY OF THE CBI AT LALDARWAJA2.22.2
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
The various banking products and services on offer at Central Bank
include:
(2.3.a) DEPOSITS
Money Multiplier Deposit Certificate (MMDC): In this the
interest keeps adding to the principal amount giving you an
added advantage to increase your deposits exponentially
Monthly/Quarterly Interest Deposit Receipt (MIDR/QIDR):
The interest is added monthly/Quarterly. An account can be
opened for duration of 12 months to 120 months with a
minimum balance of Rs. 5000.
Cent Uttam Scheme: This deposit scheme by Central Bank
offers you easy liquidity with high returns that allows you to
withdraw a part of the deposit whenever required.
Other Special Savings Accounts: These include Senior
Citizens Savings Account, Tax Saving Deposit Schemes, Smart
Deposit Schemes, Super Deposit Schemes and Special Cent
Bachat Khata
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 42
ACTIVITIES OF THE CBIACTIVITIES OF THE CBI2.32.3
HEAD LINES
Deposits Cards Loans Other Services International banking Central Bank of India Net Banking Central Bank of India Web Sites Rate of Interest on Deposits Rate of interest on Loans
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
(2.3.b) CARDS
Centralcard Electronics: This Central Bank Credit Card is
accepted in all master card electronic terminals in India and
Nepal. This can be both domestic and global.
Centralcard: This card offers you the freedom of shopping at all
the merchant establishments in the country. The internationally
acceptable one is the International Central Master Card.
Debit Card: Its the most safe and secure way of accessing your
account globally 24-hours a day at over 5.3 million merchant
establishments and 6 million ATM's
(2.3.c) LOANS
Housing Loans
Home Renovation Loan
Computer Loan
Personal Loan (Corporate and Non-Corporate)
Education Loans
Special Educational Loans
Finance For Trade
Car Loans
Loans For Commercial Vehicles
Agricultural Loans
Personal Loans For Pensioners And Teachers
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 43
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
(2.3.d) OTHER SERVICES
raveler's Cheques: Issued in the denominations of Rs. 100, Rs.
500, Rs. 1000, Rs. 2500, and Rs. 5000 at a nominal charge of
Re.1 per Rs.100.
Gift Cheques: Available in denominations of Rs.11, Rs. 25, Rs.
51 and Rs. 101 free of cost and payable at any Central Bank of
India branch.
Cash Management Services: These include collections that
can be Central's Cent QCC, Local Cheque collection and bulk
cheque collection services and payment products that include
Demand Drafts (DD), Dividend and Interest Warrants, Bank
Telegraphic Transfer (TT).
Cent Bill Pay: This facility by Central Bank allows you to pay
your bills through the Internet. It is currently available in Mumbai
and is soon going to be launched in New Delhi, Pune,
Ahmedabad, Bangalore, Chennai, Hyderabad and Kolkata
branches.
Special Services: These include Insurance, Mutual Funds and
Demat Account services.
(2.3.e) INTERNATIONAL BANKING
NRI Banking: Special NRI Savings Accounts, facilities to NRI's
Returning to India and Foreign Exchange services along with
Remittance Services are included in this
Other Specialized Services: These include Repatriable and
Non-Repatriable services along with facilities for importers and
exporters.
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 44
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
(2.3.f) Central Bank of India Net Banking
Central Bank of India provides net banking facility to its customers,
all you have to do is login to your Internet Banking Account and
access the banking service you desire. The official website of Central
Bank gives you information about the public issue, issue price, share
price, share value and stock price along with news on the shares. Any
enquiry about the IPO refund, allotment status, registrar address,
money control, listing or the recruitment procedure is entertained on
the Central Bank site.
(2.3.g) Central Bank Website
An online branch and ATM locator is also available on the official
website of Central Bank of India. You can get the exact address and
location of your nearest Central Bank branches and ATM's/ also you
get full information on the ongoing interest rates on the various
credit and deposit schemes along with the service charges for the
services provided at Central Bank. Some addresses are provided
below.
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 45
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
RATE OF INTEREST ON DEPOSIT
In the central bank of India the interest rate of the deposit on Fixed
Deposit applicable from dated 1st May 2000, this is show in the
following table:
MaturityMaturityPeriodPeriod
Up toUp toRs.15 lacsRs.15 lacs
AboveAboveRs.15 lacsRs.15 lacs
to less thanto less than Rs.1 CroreRs.1 Crore
Rs.1 Crore and above
11.11.200911.11.2009 11.11.200911.11.2009ExistingExisting
RateRate11.11.200911.11.2009
RevisedRevised raterate
21.12.200921.12.20097 days-14 days7 days-14 days 2.502.50 2.502.50 2.002.00 2.002.00 15 days to 45 days15 days to 45 days 3.253.25 3.503.50 2.502.50 2.502.50 46 days to 90 days46 days to 90 days 3.753.75 4.004.00 3.003.00 3.003.00 91 days to 179 days91 days to 179 days 5.005.00 5.005.00 3.503.50 3.503.50 180 days to 269 days180 days to 269 days 5.755.75 5.505.50 4.504.50 4.504.50 270 days to 364 days270 days to 364 days 6.256.25 6.006.00 5.005.00 5.505.50 1 year to less than 2 years1 year to less than 2 years 6.506.50 6.256.25 5.505.50 6.006.00 2 years to less than 3 years2 years to less than 3 years 6.756.75 6.506.50 5.505.50 6.006.00 3 years to less than 5 years3 years to less than 5 years 7.007.00 6.506.50 5.505.50 6.006.00 5 years and above5 years and above 7.257.25 7.257.25 5.505.50
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 46
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
RATE OF INTEREST ON LOANS
LOANS
BPLR (w.e.f. 01.04.2009) 12.00% p.a.
Direct Housing Finance Scheme - w.e.f.
10.11.2008Rate of Interest
Processing Charges*
Floating CategoryUpto Rs. 30 Lakhs
Above Rs. 30 Lakhs
Upto 5 Yrs 9.00% 10.25% 1% of Loan Amount, minimum Rs.1000/-
Over 5 Yrs & Less than 10 Yrs.
9.50% 10.75% 1% of Loan Amount, minimum Rs.1000/-
10 Yrs. & above 10.00% 11.25% 1% of Loan Amount, minimum Rs.1000/-
Fixed CategoryUpto Rs. 30 Lakhs
Above Rs. 30 Lakhs
Processing Charges
Upto 5 Yrs 10.00% 11.25% 1% of Loan Amount, minimum Rs.1000/-
Over 5 Yrs & Less than 10 Yrs.
-NA- -NA- 1% of Loan Amount, minimum Rs.1000/-
10 Yrs. & above -NA- -NA- 1% of Loan Amount, minimum Rs.1000/-
*- For changing from fixed Rate of Interest to Floating Rate of
Interest, 1% Service Charges on the balance outstanding as on the
date of change over.
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 47
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
- For changing from floating Rate of Interest to Fixed Rate of Interest,
1% Service Charges on the balance outstanding as on the date of
change over.
Personal Loan Rate of Interest
Processing Charges
Consumer Durable Loan (Cent Buy)
BPLR - 0.25% Rs. 200/- per proposal
Senior Citizen - Loan to Pensioner
For General Pensioners and for ex-staff of Central Bank of India drawing pension
BPLR NIL
Senior Citizen - Cent Swabhimaan (Reverse Mortgage Loan)
10.00% Upfront Fees: 0.15% of loan amount subject to minimum of Rs. 500/- and maximum of Rs.10,000/-
Personal Loan - Loan to corporate employees
BPLR Rs. 500/- per proposal
Personal Loan - Loan to Non-Corporate Employees
BPLR + 1.00% Rs. 500/- per proposal
Personal Loan - Loan to teachers & Employees of Educational Institute
BPLR - 1.25% Rs. 500/- per proposal
Personal Loan - Loan to LIC Agents
BPLR 1% of loan amount, minimum Rs. 250/-
Vehicle Loan Rate of Interest
Processing Charges
Two wheeler Loan
For new vehicles repayable upto 36 months BPLR - 2.00% Rs. 500/- per proposal
For new vehicles repayable beyond 36 months
BPLR - 1.00% Rs. 500/- per proposal
For second hand vehicles BPLR Rs. 500/- per proposal
Four wheeler Loan
For new vehicles repayable upto 36 months BPLR - 2.00% Rs. 2000/- per proposal
For new vehicles repayable beyond 36 months
BPLR - 1.00% Rs. 2000/- per proposal
For second hand vehicles BPLR Rs. 2000/- per proposal
Cent Vidyarthi - Education Loan(Irrespective of Amount of Loan and Place of study i.e. India or Abroad)
Rate of Interest Processing ChargesNormal
StudentIIT/ IIM Students
Male BPLR - BPLR - 2.50% Nil
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 48
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
2.00%Female BPLR -
2.50%BPLR - 3.00% Nil
SC, ST, & Minority Community Student (Female & Male)
BPLR - 2.50%
BPLR - 3.00% Nil
Name of Scheme Rate of Interest Processing Charges
Scheme for Financing Executive MBA
BPLR
Interest to be compounded monthly. Concession of 50 basis points is given if Employers Undertaking is available.Further concession of 50 basis points in RoI may be given if interest is serviced regularly during the study period. Rs.10,000/- lump sum.
Cent Trade BPLR - 1%
-Upto Rs. 25,000/- : NIL
-More than Rs. 25,000/- upto Rs. 2 Lakh: Rs. 250/- per proposal.
-More than Rs. 2 lakh upto Rs. 50 lakh: 0.5% of loan amount
Cent Vyapari BPLR - 1% Rs. 1000/- per proposal
Cent Rental
BPLR + 1.00% for loan upto 3 years
BPLR + 2.00% for loan above 3 years
1% of the loan amount subject to minimum of Rs.5,000/- and maximum of Rs.2.00 lakh.
Cent Computer BPLR Rs. 100/- per proposal
Cent Liquid BPLR1% of loan amount, minimum Rs. 500/-
Cent School BPLR - 1% NIL
Cent Jewel 10.00% Rs. 500/- per proposal
Cent Vivah 10.00% NIL
Cent Safar BPLR Rs. 1000/- per proposal
Cent Suvidha BPLR NIL
Cent Home Loan Plus 1% higher than Housing Loan Rate Rs. 500/- per proposal
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 49
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
INTRODUCTION
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 50
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
INTRODUCTIONINTRODUCTION
This project report is based on the financial analysis of the
central bank of india, and it includes various financial statement,
numerical data and it’s interpretation. From this project study, the
organisation would be able to know about their current and past
financial position and also able to make inter relation among last few
years. In this project there are many tools of financial analysis has
been used like
Ratio Analysis
Comparative Statement Analysis
Common Size Statement Analysis
Trend Analysis
The tools of financial analysis (ratio analysis, Comparative
statement analysis, common size statement analysis, trend analysis) is
helps to know about the financial condition of bank for last few years
by comparing, analyzing and interpreting.
The ratio analysis of the CBI will make necessary comments on it
so as to provide complete idea and core ideology of the bank. So that
we can easily get idea about the financial condition of CBI and it’s
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 51
HEAD LINES
Introduction of Project Objective of Project Potential of Project Limitation of Project
INTRODUCTION OF PROJECTINTRODUCTION OF PROJECT3.13.1
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
potential in future. Comparison of ratio of last few years can also helps
to get ranking of the comparative years to evaluate it on the various
criteria. The detail study of a bank’s trend analysis will be done and
final conclusion will be brought out for know the reliability and
operating performance of the central bank of India. It will provide final
conclusion according to financial analysis.
For the purpose of study the researcher has gathered data regarding
the company and research work by two ways; primary data and
secondary data.
The researcher has gathered primary data through personal interview
of manager and other working people, as the primary data seems to
be best alternative for me.
The researcher has also used secondary data source to collect
information regarding company profile. For this purpose the researcher
has referred company’s websites.
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FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
The main objective of project is to do financial analysis of the
central bank of India.
Secondly to study the present financial condition of the central
bank of India.
To study the capital structure of the central bank of India.
To study the operating performance of the central bank of
India.
To study deposits, investment & pattern & loan & advance.
To do Ratio Analysis for the CBI and make necessary comments
on it so as to provide complete idea and core ideology of the
bank. So that we can easily get idea about the financial
condition of CBI and it’s potential in future.
To make comparison of ratio analysis of last few years and get
ranking of the comparative years to evaluate it on the various
criteria
To know about the Central bank of India and also to compare the
financial condition of bank for last few years by analyzing and
interpreting.
To do Ratio Analysis for the CBI and make necessary comments
on it so as to provide complete idea and core ideology of the
bank. So that we can easily get idea about the financial
condition of CBI and it’s potential in future.
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 53
OBJECTIVE OF PROJECTOBJECTIVE OF PROJECT3.23.2
POTENTIAL OF THE PROJECTPOTENTIAL OF THE PROJECT3.33.3
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
To make comparison of ratio analysis of last few years and get
ranking of the comparative years to evaluate it on the various
criteria.
For the detail study of a bank’s trend analysis will be done and
final conclusion will be brought out for know the reliability and
operating performance of the central bank of India.
Providing final conclusion according to financial analysis.
Above detailed explanation will provide complete idea of the project
and in the last final conclusion will be made. So that the general
people will get advise or suggestions to invest or save their money in
the bank or not.
The data is mostly based on the secondary data so information
may be outdated or wrong
Mistake in the financial statement may be create effect on final
analysis
Final interpretation may be wrong due to mistake in
calculation, tabulating, analysis etc.
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 54
LIMITATION OF PROJECTLIMITATION OF PROJECT3.43.4
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
THEORETICAL CONCEPTTHEORETICAL CONCEPT
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 55
THEORETICAL
CONCEPTHEAD LINES
Meaning of financial analysis Limitation of financial analysis Tools of financial analysis
Ratio analysis Comparative financial statements Common size statements Trend analysis.
Chapter 4
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
The purpose of the conventional revenue statement and
balance sheet are to show, first, the result of operations for the
period under review, and second, the assets and liability of the firm
at the relevant date. But it is difficult to deduce any inference from
the mass of figures included in the usual annual financial statement.
So, in order to accurately gauge the financial health of the firm, it is
generally necessary to regroup and analysis the figure as disclosed
by these conventional statements to measure business performance.
The analysis of financial statement consists in breaking down a
complex set of factors or figures into simple elements. The analysis
may generally be of two types:
Analysis of financial statements over a number of years – in
such a case the trend is important;
Analysis of financial position of the concern as a particular
date- here the detailed position as disclosed by one set of
financial statements is sought to be examined.
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 56
MEANING OF FINANCIAL ANALYSISMEANING OF FINANCIAL ANALYSIS4.14.1
LIMITATIONLIMITATION OF FINANCIAL STATEMENT OF FINANCIAL STATEMENT4.24.2
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
The financial position of a business concern is affected by
several factors- economic, social and financial, but only
financial factors are being recorded in these financial
statements. Economic and social factors are felt out. Thus the
financial position disclosed by this statement is not correct and
accurate.
The profit revealed by the profit and loss account and financial
position disclosed by the balanced sheet cannot be exact: they
are essentially interim reports. Exact position can be known
when the business is liquidated.
Facts which have not been recorded in the financial books are
not depicted in the financial statement. Only quantitative
factors are taken into account. But qualitative factors such as
reputation and prestige of the business with the public, the
efficiency and loyalty of its employees, integrity of
management etc. which are equally important for the business
success, are not capable of being translated in terms of money,
and as such, they do not appear in the financial statement.
Money items are left to the personal judgment of the
accountant. For instance, provision of depreciation, stock
valuation, bad debts provision etc. depends on the personal
judgment of accountant.
On the account of convention of conservations the income
statement may not disclose true income of the business since
problem losses are considered while problem incomes are
ignored.
The fixed assets are shown at cost less depreciation on the
basis of “going concern concept.” But the value placed on the
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 57
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
fixed assets may not be the same which may be realized on
their sale.
The data contained in the financial statement are dumb; they
do not speak themselves. It is also worth while to note that
human judgment is always involved in the interpretation of
statement. It rarely happens that the users of financial
statements may have the same opinion and meaning in respect
of a particular accounting figure.
Information conveyed by these statements mat not be
comparable on account of difference between dates of
preparation of these statements. Different methods of
accounting followed by different concerns or difference in the
nature of business of different concern etc. may render the
financial statements of two concerns impossible or difficult for
the purpose of comparison.
Financial analyses adopt the following tools for analysis of the
financial statements. These are termed as method of financial
analysis:
Ratio analysis
Comparative financial statements
Common size statements
Trend analysis.
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 58
TOOLS OFTOOLS OF FINANCIAL ANALYSISFINANCIAL ANALYSIS4.34.3
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
RATIO ANALYSIS
A ratio is only a comparison of the numerator with the denominator.
The term ratio refers to the numerical or quantitative relationship
between two figures. A ratio is the relationship between two figures,
and obtained by dividing the former by the latter. Ratio are design to
show how one number is related to another. It is worked out by
dividing one number by another.
Ratio analysis is important and age old technique of financial
analysis. The data given in financial statements, in absolute from, are
dump and are unable to communicate anything. Ratios are relative
form of financial data and very useful technique to check upon the
efficiency of a firm. Some ratios indicate the trend or progress or
downfall of the firm.
Importance of ratio analysis:
The importances of ratio analysis are as follow:
Aid to measure general efficiency:
Ratios enable the mass of accounting data to be summarized
and simplified. They act as an index of the efficiency of the
enterprise. As such they served as instrument of management
control.
Aid to measure financial solvency:
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FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
Ratio are useful tools in the hands of management and other
concerned to evaluate the firms performance over a period of
time by comparing the present ratio with the past ones. They
point out firm’s liquidity position to meet its short term
obligations and long term solvency.
Aid in forecasting and planning:
Ratio analysis is an invaluable aid to management in the
discharge of its basic function such as planning, forecasting,
control etc. the ratio that are derived after analyzing and
scrutinizing the past result, helps the management to prepared
budgets to formulate policies and to prepared the future plan of
action etc.
Facilitate decision making:
It shows light on the degree of efficiency of the management
and utilization of the assets and that is why it is called surveyor
of efficiency. They help management in decision making.
Effective tool:
Ratio analysis is help in making effective control of the
businessmen. Ratio ensures secrecy.
Limitation of ratio analysis:
Ratio analysis is, as already mentioned, a widely- used tool of
financial analysis. It is because ratio is simple and easy to
understand. But they must be used very carefully. They suffer from
various limitations. If due care is not taken, they might confuse than
clarity the situation. Different firms may use these terms in different
senses or the same firm may use them to mean different things at
different times. Some of the limitations of the ratio analysis are given
below:
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FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
Limitation of accounting records:
Ratio analysis is based on financial statements which are
themselves subject to limitations. Thus, ratios calculated on the
figures given in the financial statements, also suffers from
similar limitation.
No allowances for price level changes:
Due to change in price level of various years, comparison of
ratio of such years cannot give correct conclusion. A change in
the price level can seriously affect the validity of comparison of
ratio computed for different time periods. For instance, a firm
which has purchased an assets at a lower price, will show a
higher return, then the firm which has purchased the at an
assets at a higher price.
Changes in accounting procedure:
Comparison between two variables proves worth provided their
basis of valuation is identical. But in reality, it is not possible,
such as methods of valuation of stick or charging different firms
for their valuation, and then comparison will practically be of no
use.
Limited used of single ratio:
A single ratio would not be able to convey anything. Ratio can
be useful only when they are computed in a sufficient large
number. If too many ratios are calculated, they are likely to
instead of revealing meaningful conclusion.
Background is overlooked:
When inter- firm comparison is made, they differ substantially
in age, size, nature of product etc. when an inter firm
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 61
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
comparison is made, these factors are not considered.
Therefore, ratio analysis cannot give satisfactory result.
Changing policies:
Ratio is computed on the basis of past result. Past is not an
indicator of future. Ratios computed from historical data are
used for predicting and projecting the likely events in the
future. Such ratio may provide a glimpse of firm’s past
performance. But forecast for nature may not be correct as
several other factors like management policies, market
condition etc. may induce future operations.
COMMON SIZE STATEMENTS
Ratio analysis apart, another useful way of analyzing financial
statement is to convert them into common size statement by
expressing absolute rupee amount into percentages. When this
method is pursued the income statement exhibits each expense item
or group of expense items as a percentage of net sales and net sales
are taken as 100 percent
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FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
Common Size Financial Statements
Common size ratios are used to compare financial statements of
different-size companies, or of the same company over different
periods. By expressing the items in proportion to some size-related
measure, standardized financial statements can be created, revealing
trends and providing insight into how the different companies
compare.
The common size ratio for each line on the financial statement is
calculated as follows:
Common Size
Ratio =
Item of
Interest
Reference
Item
For example, if the item of interest is inventory and it is referenced to
total assets (as it normally would be), the common size ratio would
be:
Common Size Ratio for
Inventory =
Inventory
Total
Assets
The ratios often are expressed as percentages of the reference
amount. Common size statements usually are prepared for the
income statement and balance sheet, expressing information as
follows:
Income statement items - expressed as a percentage of total
revenue
Balance sheet items - expressed as a percentage of total assets
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FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
The following example income statement shows both the dollar
amounts and the common size ratios:
Common Size Income Statement
Income
Statement
Common-Size
Income
Statement
Revenue 70,134 100%
Cost of Goods
Sold
44,221 63.1%
Gross Profit 25,913 36.9%
SG&A Expense 13,531 19.3%
Operating Income 12,382 17.7%
Interest Expense 2,862 4.1%
Provision for Taxes 3,766 5.4%
Net Income 5,754 8.2%
For the balance sheet, the common size percentages are referenced
to the total assets. The following sample balance sheet shows both
the dollar amounts and the common size ratios:
Common Size Balance Sheet
Balance
Sheet
Common-Size
Balance
Sheet
ASSETS
Cash & Marketable
Securities
6,029 15.1%
Accounts Receivable 14,378 36.0%
Inventory 17,136 42.9%
Total Current Assets 37,543 93.9%
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FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
Property, Plant, &
Equipment
2,442 6.1%
Total Assets 39,985 100%
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities 14,251 35.6%
Long-Term Debt 12,624 31.6%
Total Liabilities 26,875 67.2%
Shareholders' Equity 13,110 32.8%
Total Liabilities & Equity 39,985 100%
The above common size statements are prepared in a vertical
analysis, referencing each line on the financial statement to a total
value on the statement in a given period.
The ratios in common size statements tend to have less variation
than the absolute values themselves, and trends in the ratios can
reveal important changes in the business. Historical comparisons can
be made in a time-series analysis to identify such trends.
Common size statements also can be used to compare the firm to
other firms.
Comparisons Between Companies (Cross-Sectional Analysis)
Common size financial statements can be used to compare multiple
companies at the same point in time. A common-size analysis is
especially useful when comparing companies of different sizes. It
often is insightful to compare a firm to the best performing firm in its
industry (benchmarking). A firm also can be compared to its industry
as a whole. To compare to the industry, the ratios are calculated for
each firm in the industry and an average for the industry is
calculated. Comparative statements then may be constructed with
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FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
the company of interest in one column and the industry averages in
another. The result is a quick overview of where the firm stands in
the industry with respect to key items on the financial statements.
Limitations
As with financial statements in general, the interpretation of common
size statements is subject to many of the limitations in the
accounting data used to construct them. For example:
Different accounting policies may be used by different firms or
within the same firm at different points in time. Adjustments
should be made for such differences.
Different firms may use different accounting calendars, so the
accounting periods may not be directly comparable.
COMPARATIVE STATEMENT
The benefits of a comparative statement are varied for a corporation.
Because of the uniform format of the statement, it is a simple
process to compare the gross sales of a given product or all products
of the company with the gross sales generated in a previous month,
quarter, or year. Comparing generated revenue from one period to a
different period can add another dimension to analyzing the
effectiveness of the sales effort, as the process makes it possible to
identify trends such as a drop in revenue in spite of an increase in
units sold.
Along with being an excellent way to broaden the understanding of
the success of the sales effort, a comparative statement can also
help address changes in production costs. By comparing line items
that catalog the expense for raw materials in one quarter with
another quarter where the number of units produced is similar can
make it possible to spot trends in expense increases, and thus help
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FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
isolate the origin of those increases. This type of data can prove
helpful to allowing the company to find raw materials from another
source before the increased price for materials cuts into the overall
profitability of the company.
A comparative statement can be helpful for just about any
organization that has to deal with finances in some manner. Even
non-profit organizations can use the comparative statement method
to ascertain trends in annual fund raising efforts. By making use of
the comparative statement for the most recent effort and comparing
the figures with those of the previous year’s event, it is possible to
determine where expenses increased or decreased, and provide
some insight in how to plan the following year’s event.
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FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
RESEARCH METHODOLOGY
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 68
Chapter 5
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
RESEARCH METHODOLOGYRESEARCH METHODOLOGY
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 69
HEAD LINES
Research Methodology Meaning of Research. Research Problem. Research Design. Sampling Design. Data Collection method. Analysis and interpretation of Data.
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
The procedure adopted for conducting the research requires a lot of
attention as it has direct bearing on accuracy, reliability and
adequacy of results obtained. It is due to this reason that research
methodology, which we used at the time of conducting the research,
needs to be elaborated upon. Research Methodology is a way to
systematically study and solve the research problems. If a researcher
wants to claim his study as a good study, he must clearly state the
methodology adapted in conducting the research the research so
that it way be judged by the reader whether the methodology of work
done is sound or not.
Meaning of Research.
Research Problem.
Research Design.
Sampling Design.
Data Collection method.
Analysis and interpretation of Data.
Meaning of Research
Research is defined as “a scientific and systematic search for
pertinent information on a specific topic”. Research is an art of
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 70
RESEARCH METHODOLOGYRESEARCH METHODOLOGY5.1
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
scientific investigation. Research is a systematized effort to gain now
knowledge. It is a careful investigation or inquiry especially through
search for new facts in any branch of knowledge. Research is an
academic activity and this term should be used in a technical sense.
Research comprises defining and redefining problems, formulating
hypothesis or suggested solutions. Making deductions and reaching
conclusions to determine whether they if the formulating hypothesis.
Research is thus, an original contribution to the existing stock of
knowledge making for its advancement. The search for knowledge
through objective and systematic method of finding solutions to a
problem is research.
Research Problem
The first step while conducting research is careful definition of
Research Problem. “To ERR IS THE HUMAN” is a proverb which
indicates that no one is perfect in this world. Every researcher has to
face many problems which conducting any research that’s why
problem statement is defined to know which type of problems a
researcher has to face while conducting any study. It is said that,
“Problem well defined is problem half solved.”
Basically, a problem statement refers to some difficulty, which
researcher experiences in the context of either a theoretical or
practical situation and wants to obtain the solution for the same.
The problem statement here is:
“To make a Financial Analysis of Financial statements of The
Central Bank of India”
Research Design
A research designs is the arrangement of conditions for collection
and analysis data in a manner that aims to combine relevance to the
research purpose with economy in procedure. Research Design is the
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FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
conceptual structure with in which research in conducted. It
constitutes the blueprint for the collection measurement and analysis
of data. Research Design includes and outline of what the researcher
will do form writing the hypothesis and it operational implication to
the final analysis of data. A research design is a framework for the
study and is used as guide in collection and analyzing the data. It is a
strategy specifying which approach will be used for gathering and
analyzing the data. It also includes the time and cost budget since
most studies are done under these two cost budget since most
studies are done under theses tow constraints.
The design is such studies must be rigid and not flexible and most
focus attention on the following.
1. What is the study about?
2. Why is the study being made?
3. Where will the study be carried out?
4. What type of data is required?
5. Where can be required data be found?
6. What period of time will the study include?
7. What will be sample design?
8. What techniques of data collection will be used?
9. How will the data be analyzed?
10. In what style will the report be prepared?
TYPES OF RESEARCH DESIGN
EXPERIMENTAL RESEARCH DESIGN
EXPLORATORY RESEARCH DESIGN
DESCRIPTIVE& DIAGNOSTIC RESEARCH
Exploratory Research Design: This research design is preferred
when researcher has a vague idea about the problem the researcher
has to explore the subject.
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 72
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
Experimental Research Design – The research design is used to
provide a strong basis for the existence of casual relationship
between two or more variables.
Descriptive Research Design – It seeks to determine the answers
to who, what, where, when and how questions. It is based on some
previous understanding of the matter.
Diagnostic Research Design It determines the frequency with
which something occurs or its association with something else.
Research Design Used in this Project
Research Design chosen for this study is Descriptive Research
Design. Descriptive study is based on some previous understanding
of the topic. Research has got a very specific objective and clear cut
data requirements.
Sampling Design
Sampling is necessary because it is almost impossible to examine the
entire parent population (i.e. the entire universe) various factors such
as time available cost, purpose of study etc. make it necessary for
the researchers to choose a sample. It should neither be too small
nor too big. It should be manageable. THE sample size of past 3 years
is taken for present study due to time limitation.
DATA COLLECTIONS
The process of data collection begins after a research problem has
been defined and research design ahs been chalked out. There are
two types of data –
METHODS OF PRIMARY DATA
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 73
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
OBSERVATION METHOD
INTERVIEW METHODS
QUESTIONAIRE METHOD
SCHEDULE METHOD
PRIMARY DATA -
It is first hand data, which is collected by researcher itself. Primary
data is collected by various approaches so as to get a precise,
accurate, realistic and relevant data. The main tool in gathering
primary data was investigation and observation. It was achieved by a
direct approach and observation from the officials of the company.
SECONDARY DATA - it is the data which is already collected by
someone else. Researcher has to analyze the data and interprets the
results. It has always been important for the completion of any
report. It provides reliable, suitable, adequate and specific
knowledge.
I took data comprise annual financial statement and past records.
Bank has provided me annual financial statement from 2006-07 to
2008-09 by help of which, I prepared my report.
The valuable cooperation extended by staff members contributed a
lot to fulfill the requirements in the collection of data in order to
complete the project. Various statistical tools are applied depending
on the research problem. In this study ratio analysis, comparative
financial statements analysis, and common size statements has been
used for analyzing and interpreting the result.
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 74
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
ANALYSIS AND INTERPRETATION
OF THE DATA
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 75
Chapter 6
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
CENTRAL BANK OF INDIALAL-DARWAJA, SURAT-395003
PROFIT & LOSS A/C FOR THE HALF YEAR ENDED 31-3-2008
PARTICULAR AMOUNT Ps.TOTAL
AMOUNTPs.
(A) INCOME: - (1) Interest earned :--
<i> Interest on Advances other than Bank:
- Term Loans 40,65,337 23 - Demand Loans 2,44,360 95 - Cash Credits 4,55,539 08 - Over Draft 8,00,261 06 - Export / Import Loans - - - Other
Sub-Total<i> -------------- ---- 55,65,487 37
<ii> Interest on Advances to Banks:
- -
<iii>Interest on Bills Purchased / Discounted :
- Interest on bill purchased / discounted / Negotiated (Inland) 3227 00
- Int. on bills purchased / Discounted / Negotiated (Foreign)
- -
- Overdue Interest on T.T. Discounted by others banks.
- -
Sub-Total <iii> -------------- ---- 3227 00
<iv>Discount on Bills, TTS etc. - - - -<v> Income on Investment (C.O.
Item)- - - -
<vi>Interest on Balances with reserve Bank of India
- - - -
<vii> Others: - Interest Received from
Branches / NBO - Interest Received from central
office. 2,03,63,474 00Sub-Total<vii> -------------- ---- 2,03,63,474 00
Total Interest Earned:-- -
2,59,28,971
37
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 76
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
(2) Other Income:--
<i> Commission Exchange Income:
(a)Commission / Brokerage :- - Bill for collection 29,270 00 - Letter of credit - - - Letter of guarantee(DPG) 28,177 35 - Bill purchase - Payment of dividend - - - Safe custody Accounts - - - Sales & Purchase of Shares &
Securities- -
- Under writing commission - - - Incident / Service charges 4,62,121 01 - Processing charges 86,790 00 - Government Business
Transaction - -
- Commission on travelers cheques
- -
- Commission on bank assurance-life
2,382 00
- Commission on bank assurance non-life
5,820 00
- Commission on mutual fund poducts
1,409 91
Sub-Total(a) -------------- ---- 616970 27 (b) Commission / Brokerage
(Foreign):- - Bill for collection - - - Letter of credit [export] - - - Letter of credit [Import] - Letter of guarantee / DPG - - - Bill purchased Discounted - -
Sub-Total(b) -------------- ---- - - (c) Exchange:- - DD / TT (Inland) 2,58,983 19 - DD / TT (Foreign) - -
Sub-Total(c) -------------- ---- 2,58,983 19Total of commission , Exchange & Brokerage (a + b + c)
- -8,75,953 46
<ii> Profit / Loss on sales of Investments (C.O. Item)
- -
<iii> Profit & Loss on - -
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 77
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
Revaluation of Investment
<iv> Profit & Loss on sale of land, Buildings & Other Assets.
- -
<v> Profit & Loss on Exchanges Transactions
- -
<vi> Income Earned by way of dividends etc. From subsidiary and/or joint ventures abroad / in India.
- -
<vii> Miscellaneous Income: - - Rent of safe Deposit Lockers 2,26,977 - Recovery received in accounts
written off- -
- Rent received from occupants of bank’s own premises
- -
- Others 1,446 80Total of other income ( i to vii) -------------- ---- 11,04,376 46
TOTAL INCOME (1+2)- -
2,70,33,347
83
PARTICULAR AMOUNT PsTOTAL
AMOUNTPs
2,39,49,366 95
(B) EXPENDITURE:- (3) Interest Expected :-
<1> Interest on Deposit : (a) Banks :- - Demand Deposits - - - Term Deposit - -
Sub-Total (a) ------------- ---- - - (b) Others :- 1. Interest on Saving Deposit: 32,29,747 26 2. Interest on Term Deposits: - Interest on Fixed Deposit 3,61,521 54 - Interest on Quarterly Deposit 3,79,189 10 - Interest on Money Multiplier
Deposit 69,63,617 12 - Interest on Recurring Deposit 24,549 60 - Interest on Khazana Deposit
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 78
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
- Interest on FCNR(B) Deposit 2,51,505 62 - Interest on Certificate of Dep. - - - Interest on Other Term Deposit 1,84,753 80
Total of 2. -------------- ---- 81,65,136 84 Sub Total(a + b) 1,13,94,884 04
<ii> Interest on Reserve Bank of India / Inter Bank Borrowings
- - - -
<iii> Interest Paid to Others - - - - - Interest on Borrowing paid to - -
<iv> Others :- - Interest Paid to Branches / NBO - - - Interest paid to Central office 70,72,628 00
Sub-Total<iv> -------------- ---- 70,72,628
Total Interest Expended ( i to iv)-------------- ----
1,84,67,512 04
(4) Operating Expenses :-
<i> Payments to and Provisions for Employees:
- Basic pay / Personal pay 19,79,448 00 - Special Pay 1,79,672 12 - Dearness Allowances 6,92,567 00 - City compensatory Allowances 55,691 19 - House Rent Allowances 1,53,756 70 - Medical Aid 52,343 50 - Leave fare concession 10,576 00 - Leave Encashment 91,456 69 - Bonus 16,460 00 - Other Expenses 23,321 55 - Staff Welfare Expenses - Contribution to provident fund 44,645 00 - Ex-gratia paid to pre. 1986
retirees (C.O. Item)- -
Sub Total <i> -------------- ---- 33,96,050 16
<ii> Rent, Taxes and Lighting :- - Rent paid for office premises 1,99,368 00 - Rent paid for other premises 23,400 00 - Municipal / other Taxes on
bank’s property
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 79
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
- Lighting generator Expenses 68,860 00Sub Total <ii> -------------- ---- 2,91,628 93
<iii> Printing & Stationary 31,285 59
<iv> Advertisement & publicity
<v> Depreciation on Bank’s property ( C.O. Item) : -
- Depreciation on building - - - Depreciation on Furniture &
fixtures - -
Sub Total<v> -------------- ---- - -
<vi> Director’s Fees Allowances & Expenses
- -
<vii> Auditor’s fees & Expenses :-
- Statutory central Auditors - - - Branch Auditors - - - Traveling and others expenses - -
Sub Total <vii> -------------- ---- - -
<viii> Law charges 3,57,942 00
<ix> Postages, Telegrams, Telephones etc.:-
- Postage & Telegrams 4,142 00 - Telephones & Telex / Fax 3,697 00 - Amount paid for leased line 3,816 00
Sub Total <ix> -------------- ---- 8,365 00
<x> Repairs & Maintenance : - - Bank’s own property - - - Furniture & Fixtures 7,525 00 - Annual maintenance charge 4,264 00
Sub Total <x> -------------- ---- 11,889 00
<xi> Insurance: - - Insurance - - - Deposit Insurance - -
Sub Total <xi> -------------- ---- - -
<xii> Other Expenditure:- - Traveling exp. 22,096 18 - Boarding exp. 4,326 00
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 80
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
- Local conveyance paid / Reimbursed 21,748 00
- Diem allowances paid-officer 17,355 00 - Diem allowances paid-clerk 8,000 00 - Diem allowances paid-sub staff 780 00 - Reimbursement of conveyance
Exp. To eligible officers - Petrol Exp. For motors vehicles - - - Maintenance Exp. Of Transit
House- -
- Entertainment Exp. - Hospital exp. 5,913 50 - Wages paid to sweepers and
casual labor 3,460 00 - Petty cash Expenses 5,781 16 - Currency chest guarding exp. 2,70,000 00 - Clearing House Charges 1,14,035 00 - Fees for Revenue / Concurrent /
other Auditors 98,452 00 - Professional Fees paid - - - Premium paid to ECGC & other
corporations - -
- News papers / Journals 4,847 00 - Donations to Institution - - - Others 12,594 93
Sub Total <xii> -------------- ---- 5,94,388 71
<xiii> Provisions and Contingencies
- -
Total Operating Expenses <i to xii>
46,91,548 46
TOTAL EXPENDITURE ( 3 + 4 )-------------- ----
2,31,59,060
86
PROFIT BALANCE ( A – B ) 38,74,287 14
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 81
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
COMPARATIVE BALANCE SHEET STATEMENT
CENTRAL BANK OF INDIALAL-DARWAJA, SURAT-395003
COMPARATIVE BALANCE SHEET STATEMENT FOR THE 3 YRS
PARTICULAR 2007 2008 2009
(A) CAPITAL AND LIABILITIES :-
(1) Capital (Fully owned by central Government)
(2) Reserves & surplus
(3) Deposits:-<I> Demand Deposit :- - Current / call Deposit a. From Bank b. From Others 7,66,96,927 9,26,66,535 73335300
<II> Saving Bank Deposits 18,08,81,307 19,88,34,956 234270014
<III> Term Deposit :- a. From Bank b. From Others:- - Fixed Deposits 1,04,58,175 1,08,30,348 4067737 - QID 1,43,19,795 1,54,89,177 28318799 - MMD 15,64,35,938 21,99,69,789 440504862 - Cent uttam Deposit 1,93,686 1,93,686 193686 - Recurring Deposit 8,71,946 7,38,298 860660 - FNCR 55,68,522 5445660 1461073 - Certificate of Deposit - Other Term Deposit 41,65,526 50,57,513 10350157
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 82
COMPARATIVE STATEMENT ANALYSISCOMPARATIVE STATEMENT ANALYSIS5.15.1
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
Total Deposit(3) 44,95,97,826 54,92,25,958 793249310
(4) Borrowing
(5) Other Liabilities & Provisions.
<I> Bills Payable : - Bills payable / MIS Payable - T.T.’S Payable - Pay slips / Banker’s cheques
Issued. 18,25,445 30,47,703465980
- Others 1,414 1,414 1414
<II> Inter-Office , Adjustment (Net) i.e. Branch Adjustment)
<III> Interest Accrued : - On Deposits 17,12,343 20,82,337 2522608 - On Borrowings<IV> Other Liabilities:- - Accrued Expenses 40,900 40,000 106600 - Reversal of Unrealized ,
Interest 1,12,392 1,12,392 237778 - Amount received from court
Receiver / Borrowers & held pending adjustments 1,60,696 1,60,696
- Income tax & other Taxes to be remitted 4,41,210 1327607
- Commission on guaranteed LC 1,15,468 1,25,744 128300
- Advance rent Reserved from locker holder. 3,19,510 2,83,837 320368
- Others 71,049 1,97,528 237662
Total other Liabilities & Provisions(5) 43,68,593 64,83,486 5348317
TOTAL 45,39,66,419
55,57,09,445 798597627
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 83
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
PARTICULAR 2007 2008 2009
(B) ASSETS: (6) Cash & Balances with
Reserve Bank of India:-<I> Cash : - In Hand 57,41,098 71,86,591 15013378 - In Foreign Currency Notes
<II> Balance with Reserve Bank of India :
- Incurrent Account - In other Account
Total of (6) 57,41,098 71,86,591 15013378
(7) Balance with Banks And Money at call and short notice:
- In India - out side in India
(8) Investments:(9) Advances: <I> Bill purchased and
discounted33,60,423 31,82,025
3163004<II> Cash credits, overdraft, &
loan repayable on demand - Cash credit 4,79,01,002 4,74,63,883 51019908 - Overdraft 4,50,33,805 4,73,57,980 50128530 - Loan repayable on demand 43,65,180 49,53,204 5078500<III> Term loan 9,70,48,629 11,65,89,119 135680795
Total Advances(9) 19,77,09,042
21,95,46,212 241907733
(10) Fixed Assets:- - Premises (C.O. Item) - Other Fixed Assets ( Including furniture &
36,24,509 36,54,074 3455597
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 84
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
Fixtures)Total Fixed Asset(10) 36,24,509 36,54,074 3455597
(11) Other Assets:-<I> Other Assets:- - Inter office Adjustment i.e. Branch Adjustment 24,61,58,808 32,43,38,322 537180116 - Stationary and stamps on
hand 1,11,871 1,51,979153379
<II> Amount Not in the Nature of Advances :-
- Prepaid expenses 11,000 11,000 - Advance to staff 15000 - Interest free advances to
staff 57,76,50 4,71,450317693
- Deposit with Government and other Departments 9,850 9,850
9850
- Staff loan advance 21700 - On account payments made
to other16250
- Advance payment to land lord of office and other premises 20,100 11,700
31900
- Amount paid to pensioners 1,14,080 - Difference in clearing 2,14,163 107990 - Others 2210 336313 - Miscellaneous Inter Branch
Transactions (MIBT):-a. cash b. Funds Transferred.c. Staff and Advance
against LFC, TA, Salary etc.
d. Letter of credit claimed e. D.D.s issued by other
Banks paid f. other transaction 2,400 30728
- Share Application money
Total of other Assets(11)24,68,91,68
032,43,22,56
7 538220919
TOTAL45,39,66,41
955,57,09,44
5 798597627
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 85
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
COMPARATIVE PROFIT & LOSS A/C
CENTRAL BANK OF INDIALAL-DARWAJA, SURAT-395003
COMPARATIVE PROFIT & LOSS A/C FOR THE 3 YRS
PARTICULAR 2007 2008 2009(A) INCOME: -
(1) INTEREST EARNED :--
<i> Interest on Advances other than Bank:
- Term Loans 19,31,691 40,65,337 5927523 - Demand Loans 2,19,085 2,44,360 216384 - Cash Credits 5,42,000 4,55,539 128102 - Over Draft 7,60,352 8,00,261 978901 - Export / Import Loans - - Other
Sub-Total<i> 34,53,099 55,65,487 7250910
<ii> Interest on Advances to Banks:
-
<iii>Interest on Bills Purchased / Discounted :
- Interest on bill purchased / discounted / Negotiated (Inland) 3,227
- Int. on bills purchased / Discounted / Negotiated (Foreign)
-
- Overdue Interest on T.T. -
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 86
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
Discounted by others banks.Sub-Total <iii> 3,227
<iv>Discount on Bills, TTS etc. - -<v> Income on Investment (C.O.
Item)- -
<vi>Interest on Balances with reserve Bank of India
- -
<vii> Others: - Interest Received from
Branches / NBO - Interest Received from central
office. 1,63,38,545 2,03,63,474 32063360Sub-Total<vii>
1,63,38,5452,03,63,47
432063360
TOTAL INTEREST EARNED:- 1,97,94,8712,59,28,97
1 393142702) OTHER INCOME:--
<i> Commission Exchange Income:
(a)Commission / Brokerage :- - Bill for collection 37,042 29,270 19247 - Letter of credit - - Letter of guarantee(DPG) 84,500 28,177 7451 - Bill purchase - Payment of dividend - - Safe custody Accounts - 500 - Sales & Purchase of Shares &
Securities-
- Under writing commission - - Incident / Service charges 5,66,506 4,62,121 - Processing charges 2,05,069 86,790 984341 - Government Business
Transaction -
- Commission on travelers cheques
-
- Commission on bank assurance-life
2,3825000
- Commission on bank assurance non-life
25,825 5,82012919
- Commission on mutual fund poducts
1,410
Sub-Total(a) 9,18,942 616970 1029459 (b) Commission / Brokerage
(Foreign):- - Bill for collection -
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 87
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
- Letter of credit [export] - - Letter of credit [Import] - Letter of guarantee / DPG - - Bill purchased Discounted -
Sub-Total(b) -------------- - (c) Exchange:- - DD / TT (Inland) 2,77,269 2,58,983 290320 - DD / TT (Foreign) -
Sub-Total(c) 2,77,269 2,58,983 290320Total of commission , Exchange & Brokerage (a + b + c) 11,96,210 8,75,953 1319779
<ii> Profit / Loss on sales of Investments (C.O. Item)
-
<iii> Profit & Loss on Revaluation of Investment
-
<iv> Profit & Loss on sale of land, Buildings & Other Assets.
-
<v> Profit & Loss on Exchanges Transactions
-
<vi> Income Earned by way of dividends etc. From subsidiary and/or joint ventures abroad / in India.
-
<vii> Miscellaneous Income: - - Rent of safe Deposit Lockers 2,22,747 2,26,977 198869 - Recovery received in accounts
written off-
- Rent received from occupants of bank’s own premises
-
- Others 241 1,446Total of Miscellaneous Income 2,22,988 2,28,423 198869
TOTAL OF OTHER INCOME ( I TO VII) 14,19,198 11,04,376 1518648
TOTAL INCOME (1+2) (A) 2,12,14,0692,70,33,34
7 40832918
PARTICULAR 2007 2008 2009
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 88
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
(B) EXPENDITURE:- (3) INTEREST EXPECTED :-
<1> Interest on Deposit : (a) Banks :- - Demand Deposits - - Term Deposit -
Sub-Total (a) ------------- - (b) Others :- 1. Interest on Saving Deposit: 30,32,755 32,29,747 3732257 2. Interest on Term Deposits: - Interest on Fixed Deposit 3,43,883 3,61,521 120843 - Interest on Quarterly Deposit 3,40,490 3,79,189 947008 - Interest on Money Multiplier
Deposit 43,76,405 69,63,617 19719599 - Interest on Recurring Deposit 87,978 24,549 22879 - Interest on uttam Deposit 14,810 - Interest on FCNR(B) Deposit 20,57,161 2,51,505 - Interest on Certificate of Dep. - - Interest on Other Term Deposit 1,00,533 1,84,753 400864
Total of 2. 54,69,815 81,65,136 21211193 Sub Total(a + b)
85,04,5701,13,94,88
4 24943450
<ii> Interest on Reserve Bank of India / Inter Bank Borrowings
- -
<iii> Interest Paid to Others - - - Interest on Borrowing paid to -
<iv> Others :- - Interest Paid to Branches / NBO - - Interest paid to Central office 49,80,865 70,72,628 9450917
Sub-Total<iv> 49,80,865 70,72,628 9450917
TOTAL INTEREST EXPENDED ( I TO IV) 1,34,85,435
1,84,67,512 34394367
(4) OPERATING EXPENSES :-
<i> Payments to and Provisions for Employees:
- Basic pay / Personal pay 21,14,272 19,79,448 2499604 - Special Pay 1,76,024 1,79,672 214447 - Dearness Allowances 5,57,341 6,92,567 1195133
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 89
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
- City compensatory Allowances 66,203 55,691 60884 - House Rent Allowances 1,60,099 1,53,756 164476 - Medical Aid 98,803 52,343 135792 - Leave fare concession 28,639 10,576 41200 - Leave Encashment 5,44,248 91,456 52076 - Bonus 5,824 16,460 4793 - Other Expenses 22,280 23,321 34510 - Staff Welfare Expenses - Contribution to provident fund 91,849 44,645 108610 - Ex-gratia paid to pre. 1986
retirees (C.O. Item)-
Sub Total <i> 33,75,763 33,96,050 4511525
<ii> Rent, Taxes and Lighting :- - Rent paid for office premises 1,49,526 1,99,368 284143 - Rent paid for other premises 27,300 23,400 74400 - Municipal / other Taxes on
bank’s property - Lighting generator Expenses 67,983 68,860 86849
Sub Total <ii> 4,51,987 2,91,628 445392<iii> Printing & Stationary 40,024 31,285 155505
<iv> Advertisement & publicity
<v> Depreciation on Bank’s property ( C.O. Item) : -
- Depreciation on building - - Depreciation on Furniture &
fixtures -
Sub Total<v> -------------- -
<vi> Director’s Fees Allowances & Expenses
-
<vii> Auditor’s fees & Expenses :-
- Statutory central Auditors - - Branch Auditors - - Traveling and others expenses -
Sub Total <vii> -------------- -
<viii> Law charges 11,700 3,57,942 6584
<ix> Postages, Telegrams, Telephones etc.:-
- Postage & Telegrams 13,696 Cr 4,142 Cr 6764
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 90
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
- Telephones & Telex / Fax 15,516 Dr 3,697 Dr 14073 - Amount paid for leased line 3,810 Dr
Sub Total <ix> 1,820 8,365 20837
<x> Repairs & Maintenance : - - Bank’s own property - - Furniture & Fixtures 39,105 7,525 47892 - Annual maintenance charge 4,264 5313
Sub Total <x> 39,105 11,889 53205
<xi> Insurance: - - Insurance 4,895 - - Deposit Insurance -
Sub Total <xi> 4,895 -------------- -
<xii> Other Expenditure:- - Traveling exp. 17,493 22,096 136422 - Boarding exp. 893 9,326 8736 - Local conveyance paid /
Reimbursed 3,356 21,74835663
- Diem allowances paid-officer 31,760 17,355 4575 - Diem allowances paid-clerk 30,595 8,000 - Diem allowances paid-sub staff 780 - Reimbursement of conveyance
Exp. To eligible officers 56,81580
- Petrol Exp. For motors vehicles - - Maintenance Exp. Of Transit
House-
- Entertainment Exp. - Hospital exp. 1,956 5,913 4341 - Wages paid to sweepers and
casual labor 16,635 3,4601414
- Petty cash Expenses 14,010 5,781 20415 - Currency chest guarding exp. 2,70,000 53414 - Clearing House Charges 66,140 1,14,035 78643 - Fees for Revenue / Concurrent /
other Auditors 69,649 98,45280895
- Professional Fees paid - - Premium paid to ECGC & other
corporations -
- News papers / Journals 4,567 4,847 6252 - Donations to Institution - - Others 24,222 12,594 1614
Sub Total <xii> 3,48,639 5,94,388 432464
<xiii> Provisions and -
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 91
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
ContingenciesTOTAL OPERATING EXPENSES
<I TO XII> 42,71,936 46,91,548 5625512
TOTAL EXPENDITURE ( 3 + 4 ) (B)
1,77,57,3712,31,59,06
040019879
PROFIT BALANCE ( A – B ) 34,56,698 38,74,287 813039
(By taking data of 2005 as a base year)
31/3/2005 31/3/2006 31/3/2007 31/3/2008 31/3/2009
Advances 171580590 165005256 197709042 219546212 241907733
Current A/c 59866450 68564840 76696927 92666535 73335300
Saving A/c 160045556 150564500 180881307 198834956 234270014
Time Deposit 164523560 202510595 192013589 257724467 485643995
(Data In %)
31/3/2006 31/3/2007 31/3/2008 31/3/2009
Growth in Advances -3.8% 19.8% 11.0% 10.20%
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 92
TREND ANALYSIS OF BALANCESHEETTREND ANALYSIS OF BALANCESHEET4.24.2
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
Growth in Current A/c 14.5% 11.9% 20.8% -20.90%
Growth in Saving A/c -5.9% 20.1% 9.9% 17.80%
Growth in Time Deposit 23.1% -5.2% 34.2% 88.40%
31/3/2005 31/3/2006 31/3/2007 31/3/2008 31/3/20090
50000000
100000000
150000000
200000000
250000000
300000000
171580590 165005256
197709042219546212
241907733
Advances
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 93
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
31/3/2006 31/3/2007 31/3/2008 31/3/2009
-5.00%
0.00%
5.00%
10.00%
15.00%
20.00%
25.00%
-3.80%
19.80%
11.00% 10.20%
Growth in Advances
Interpretation
The amount of advances of CBI is increases since last 4 years,
but it is increasing with decreasing rate because in 2008
growth rate of advances was 11% while in 2009 it 10.20%
31/3/2005 31/3/2006 31/3/2007 31/3/2008 31/3/20090
10000000
20000000
30000000
40000000
50000000
60000000
70000000
80000000
90000000
100000000
5986645068564840
76696927
92666535
73335300
Current A/c
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 94
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
31/3/2006 31/3/2007 31/3/2008 31/3/2009
-25.00%
-20.00%
-15.00%
-10.00%
-5.00%
0.00%
5.00%
10.00%
15.00%
20.00%
25.00%
14.50%11.90%
20.80%
-20.90%
Growth in Current A/c
Interpretation
The amount of current a/c was in increasing rate since 2005,
but in 2009 it was decreased by 20%
31/3/2005 31/3/2006 31/3/2007 31/3/2008 31/3/20090
50000000
100000000
150000000
200000000
250000000
160045556 150564500
180881307198834956
234270014
Saving A/c
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 95
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
31/3/2006 31/3/2007 31/3/2008 31/3/2009
-10.00%
-5.00%
0.00%
5.00%
10.00%
15.00%
20.00%
25.00%
-5.90%
20.10%
9.90%
17.80%
Growth in Saving A/c
Interpretation
The amount of saving deposits of CBI is increases since last 4
years, but it is increasing with fluctuating growth rate because
in 2007 growth rate of saving deposit was 20.1% ,in 2008 it
was 9.9%, while in 2009 it was again 17.80%
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 96
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
31/3/2005 31/3/2006 31/3/2007 31/3/2008 31/3/20090
100000000
200000000
300000000
400000000
500000000
600000000
164523560202510595 192013589
257724467
485643995
Time Deposit
31/3/2006 31/3/2007 31/3/2008 31/3/2009
-20.00%
0.00%
20.00%
40.00%
60.00%
80.00%
100.00%
23.10%
-5.20%
34.20%
88.40%
Growth in Time Deposit
Interpretation
The amount of time deposit was increase with high rate of
growth in 2009 it was around double compare to 2008
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 97
TREND ANALYSIS OF PROFIT & LOSS A/CTREND ANALYSIS OF PROFIT & LOSS A/C4.34.3
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
(By taking data of 2005 as a base year)
(Amount in Rs.)
31/3/2005 31/3/2006 31/3/2007 31/3/2008 31/3/2009
Interest Earned 1,45,89,500 1,50,98,785 1,97,94,871 2,59,28,971 3,93,14,270Other income 10,26,356 12,05,560 14,19,198 11,04,376 15,18,648Total income 1,56,15,856 1,63,04,345 2,12,14,069 2,70,33,347 4,08,32,918Interest Expended 98,45,698 1,02,56,565 1,34,85,435 1,84,67,512 3,43,94,367Operating Expenses 35,45,566 38,58,580 42,71,936 46,91,548 56,25,512Total expenditure 1,33,91,264 1,41,15,145 1,77,57,371 2,31,59,060 4,00,19,879
Profit 22,24,592 21,89,200 34,56,698 38,74,287 8,13,039
2006 2007 2008 2009
Growth in Interest Earned 3% 31% 31% 52%
Growth in Other income 17% 18% -22% 38%
Growth in Total income 4% 30% 27% 51%
Growth in Interest Expended
4% 31% 37% 86%
Growth in Operating Expenses
9% 11% 10% 20%
Growth in Total expenditure 5% 26% 30% 73%
Growth in Profit -2% 58% 12% -79%
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 98
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
31/3/2005 31/3/2006 31/3/2007 31/3/2008 31/3/20090
5000000
10000000
15000000
20000000
25000000
30000000
35000000
40000000
45000000
14589500 15098785
19794871
25928971
39314270
Interest Earned
2006 2007 2008 20090%
10%
20%
30%
40%
50%
60%
3%
31% 31%
52%
Growth in Interest Earned
Interpretation:
The amount of the interest earned was increased with increasing rate
so it is good sign for the bank and profitability point of view, in 2007
and 2008 the growth rate was became stable but in 2009 it was
increased and became around 52%
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 99
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
31/3/2005 31/3/2006 31/3/2007 31/3/2008 31/3/20090
200000
400000
600000
800000
1000000
1200000
1400000
1600000
1026356
1205560
1419198
1104376
1518648
Other income
2006 2007 2008 2009
-30%
-20%
-10%
0%
10%
20%
30%
40%
50%
17% 18%
-22%
38%
Growth in Other income
Interpretation:
The amount of other income was also increased with 38% of growth
rate, while in 2008 it was decreased by 22%, so overall it is good sign
for the bank
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 100
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
31/3/2005 31/3/2006 31/3/2007 31/3/2008 31/3/20090
5000000
10000000
15000000
20000000
25000000
30000000
35000000
40000000
45000000
15615856 16304345
21214069
27033347
40832918
Total income
2006 2007 2008 20090%
10%
20%
30%
40%
50%
60%
4%
30%27%
51%
Growth in Total income
Interpretation:
The total income of the bank was also increased due to increases in
the interest earning and other income
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 101
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
31/3/2005 31/3/2006 31/3/2007 31/3/2008 31/3/20090
5000000
10000000
15000000
20000000
25000000
30000000
35000000
40000000
9845698 1025656513485435
18467512
34394367
Interest Expended
2006 2007 2008 20090%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
4%
31%37%
86%
Growth in Interest Expended
Interpretation:
The amount of the interest expended was increased with increasing
rate since 2005, but in 2009 it was increased by 86% which is very
high compare to previous years. The reason may be that increased
the dependability on the out side debt like deposits and borrowing.
And this is not good sign for the bank
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 102
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
31/3/2005 31/3/2006 31/3/2007 31/3/2008 31/3/20090
1000000
2000000
3000000
4000000
5000000
6000000
35455663858580
42719364691548
5625512
Operating Expenses
2006 2007 2008 20090%
5%
10%
15%
20%
25%
9%11% 10%
20%
Growth in Operating Expenses
Interpretation:
The operating expenditure also increased with increasing rate since
2005. In 2008 it was increased by 10% while in 2009 it was increased
by 20%
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 103
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
31/3/2005 31/3/2006 31/3/2007 31/3/2008 31/3/20090
5000000
10000000
15000000
20000000
25000000
30000000
35000000
40000000
45000000
13391264 1411514517757371
23159060
40019879
Total expenditure
2006 2007 2008 20090%
10%
20%
30%
40%
50%
60%
70%
80%
5%
26%30%
73%
Growth in Total expenditure
Interpretation:
The total expense of the bank was increased with increasing rate, but
in 2009 it was increased by 73%, As said earlier that because of the
high increasing rate in interest expense the total expenses also
increased
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 104
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
31/3/2005 31/3/2006 31/3/2007 31/3/2008 31/3/20090
500000
1000000
1500000
2000000
2500000
3000000
3500000
4000000
4500000
2224592 2189200
34566983874287
813039
Profit
2006 2007 2008 2009
-100%
-80%
-60%
-40%
-20%
0%
20%
40%
60%
80%
-2%
58%
12%
-79%
Growth in Profit
Interpretation:
The profit of the bank was decline by 79% the reason may be that
due to increased in the level of the expenditure the profit margin was
cut down. It is true that the income level of the bank was also
increased but the increasing rate of income is less than the
increasing rate of expenditure
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 105
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
PROFIT & LOSS A/COF CENTRAL BANK OF INDIA
INCOME 2007 2008 2009
TOTAL INTEREST EARNED:- Term Loans 1931691 4065337 5927523 Demand Loans 219085 244360 216384 Cash Credits 542000 455539 128102 Over Draft 760352 800261 978901 Interest on bill purchased 3227 Interest Received from central office. 16338545 20363474 32063360TOTAL OF COMMISSION , EXCHANGE & BROKERAG
1196210 875953 1319779
TOTAL OF MISCELLANEOUS INCOME 222988 228423 198869
TOTAL INCOME (1+2) (A)2121406
92703334
74083291
8
EXPENSES 2007 2008 2009
INTEREST EXPENDED :- Interest on Saving Deposit: 3032755 3229747 3732257 Interest on Term Deposits: 5469815 8165136 21211193 Interest paid to Central office 4980865 7072628 9450917
OPERATING EXPENSES :- Payments to and Provisions for Employees
3375763 3396050 4511525
Rent, Taxes and Lighting 451987 291628 445392 Printing & Stationary 40024 31285 155505 Law charges 11700 357942 6584 Postages, Telegrams, Telephones etc.
1820 8365 20837
Repairs & Maintenance 39105 11889 53205 Insurance 4895 Other Expenditure 348639 594388 432464
TOTAL EXPENDITURE ( 3 + 4 ) (B)1775736
82315905
84001987
9
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 106
COMMON SIZE STATEMENT ANALYSISCOMMON SIZE STATEMENT ANALYSIS4.44.4
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
COMMON SIZE PROFIT & LOSS A/C
INCOME 2007 2008 2009
TOTAL INTEREST EARNED:- 93.31 95.91 96.28 Term Loans 9.11 15.04 14.52 Demand Loans 1.03 0.90 0.53 Cash Credits 2.55 1.69 0.31 Over Draft 3.58 2.96 2.40 Interest on bill purchased 0.02 0.00 0.00 Interest Received from central office. 77.02 75.33 78.52TOTAL OF COMMISSION, EXCHANGE & BROKERAG 5.64 3.24 3.23TOTAL OF MISCELLANEOUS INCOME 1.05 0.84 0.49
TOTAL INCOME (1+2) (A) 100 100 100
EXPENSES 2007 2008 2009
INTEREST EXPENDED :- 75.93 79.74 85.95 Interest on Saving Deposit: 17.08 13.95 9.33 Interest on Term Deposits: 30.80 35.26 53.00 Interest paid to Central office 28.05 30.54 23.62
OPERATING EXPENSES :- 24.07 20.26 14.05Payments to and Provisions for Employees 19.01 14.66 11.27Rent, Taxes and Lighting 2.55 1.26 1.11Printing & Stationary 0.23 0.14 0.39Law charges 0.07 1.55 0.02Postages, Telegrams, Telephones 0.01 0.04 0.05Repairs & Maintenance 0.22 0.05 0.13Insurance 0.03 0.00 0.00Other Expenditure 1.96 2.57 1.08
TOTAL EXPENDITURE ( 3 + 4 ) (B) 100 100 100
Interpretation:
From above analysis we can says that most portion of income of
banks is comes from the interest earned on loan and advances
So the interest is one of the big sources of income generation for any
bank
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 107
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
Another things is that the most of the expenditure is comes from the
interest payment on deposits, in case of CBI majority of expenses is
accured due to the interest payment on term deposit
Composition of Total income out of 100%
2007 2008 20090%
10%20%30%40%50%60%70%80%90%
100%
93.31% 95.92% 96.28%
5.64% 3.24% 3.23%1.05% 0.84% 0.49%
Composition of INCOME
Interest Earned commission, Exchange, Brokerage Miscellaneous income
Composition of Total Expenses out of 100%
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 108
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
2007 2008 20090
20
40
60
80
100
120
75.93% 79.74%85.95%
24.07% 20.26% 14.05%
Composition of EXPENSES
INTEREST EXPENDED OPERATING EXPENSES
BALANCE SHEETOF CENTRAL BANK OF INDIA
LIABILITIES 2007 2008 2009
Deposits:-Demand Deposit 76696927 92666535 73335300Saving Bank Deposits 180881307 198834956 234270015Term Deposit 192013589 257724468 485643995Total other Liabilities & Provisions 4368593 6483486 5348317
TOTAL LIABILITIES 453966420 55570944679859762
7
ASSETS 2007 2008 2009
Cash balance with RBI 5741098 7186591 15013378Advance 197709042 219546212 241907733Fixed Assets 3624599 3654074 3455597Other assets 246891680 324322567 538220919
TOTAL ASSETS 453966419 55470944479859762
7
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 109
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
COMMON SIZE BALANCE SHEET
LIABILITIES 2007 2008 2009
Deposits:-Demand Deposit 16.89 16.68 9.18Saving Bank Deposits 39.84 35.78 29.34Term Deposit 42.30 46.38 60.81Total other Liabilities & Provisions 0.96 1.17 0.67
TOTAL LIABILITIES 100 10
0 100
ASSETS 2007 2008 2009
Cash balance with RBI 1.26 1.30 1.88Advance 43.55 39.58 30.29Fixed Assets 0.80 0.66 0.43Other assets 54.39 58.47 67.40
TOTAL ASSETS 100 100 100
9.18%
29.34%
60.81%
0.67%
Composition of total Liability 2009
Demand Deposit Saving Deposits Term Deposit Liabilities & Provisions
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 110
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
16.68%
35.78%
46.38%
1.17%
Composition of total Liability 2008
Demand Deposit Saving Deposits Term Deposit Liabilities & Provisions
16.89%
39.84%
42.3%
0.96%
Composition of total Liability 2007
Demand Deposit Saving Deposits Term Deposit Liabilities & Provisions
1.88%
30.29%
0.43%67.4%
Composition of total Assets 2009
Cash balance with RBI AdvanceFixed Assets Other assets
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 111
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
1.3%
39.58%
0.66%
58.47%
Composition of total Assets 2008
Cash balance with RBI AdvanceFixed Assets Other assets
1.26%
43.55%
0.8%
54.39%
Composition of total Assets 2007
Cash balance with RBI AdvanceFixed Assets Other assets
Interpretation :
The contribution of call deposits or demand deposit to the total
liability is decreased by year to year so it is not good sign for
the bank.
The main reason behind it may be that the current account
facility provided by the bank is not very good compare to the
other bank
The contribution of saving deposits to total liability is also
decreases by year to year.
The contribution of time deposit to the total liability is increases
by year to year so it is good sign for the bank, and it also
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 112
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
determine that the trust worthiness of peoples are built by year
to year
The cash balance with RBI is also increases by year to year
which increase the confidence of investors toward bank
The contribution of the advances decreases by year to year
which is not good sign for the bank, reason may be the
increasing rate if BPLR.
Here the performance of the central bank of India as whole is given
BALANCE SHEET OF THE CENTRAL BANK OF INDIA AS WHOLE
( In Crore)
LIABILITIES
MAR '05
MAR '06
MAR '07
MAR '08
MAR '09
Total Share Capital
1,124.14
1,124.14
1,124.14 1,204.14 1,321.14
Equity Share Capital
1,124.14
1,124.14 324.14 404.14 404.14
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 113
CENTRAL BANK OF INDIA AS WHOLECENTRAL BANK OF INDIA AS WHOLE4.54.5
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
Preference Share Capital 0.00 0.00 800.00 800.00 917.00
Reserves1,617.5
01,810.1
92,179.8
4 2,699.95 3,081.99Revaluation Reserves 523.57 507.64 485.85 2,038.67 2,008.92
Net Worth3,265.2
13,441.9
73,789.8
3 5,942.76 6,412.05
Deposits60,751.
6766,482.
6582,776.
28110,319.
67131,271.
85Borrowings 139.69 310.81 782.01 449.10 804.25
Total Debt60,891.
3666,793.
4683,558.
29110,768.
77132,076.
10Other Liabilities & Provisions
4,439.32
4,445.61
5,659.97 7,244.26 9,167.07
Total Liabilities
68,595.89
74,681.04
93,008.09
123,955.79
147,655.22
ASSETSMAR '05
MAR '06
MAR '07
MAR '08
MAR '09
Cash & Balances with RBI
5,571.81
3,382.86
5,473.67
11,537.19
11,036.91
Balance with Banks, Money at Call
1,481.13
1,411.23
3,339.22 1,302.05 1,214.34
Advances27,277.
3237,483.
4851,795.
4772,997.4
385,483.2
0Investments
30,834.76
28,639.09
27,741.89
31,455.19
43,060.72
Gross Block1,333.1
21,369.1
21,483.0
4 3,119.80 3,181.69Accumulated Depreciation 580.96 644.28 715.77 799.51 903.70Net Block 752.16 724.84 767.27 2,320.29 2,277.99
Other Assets2,678.7
23,039.5
43,890.5
7 4,343.64 4,582.08Total
Assets68,595.
9074,681.
0493,008.
09123,955.
79147,655.
24
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 114
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
Mar '05 Mar '06 Mar '07 Mar '08 Mar '090.00
1,000.00
2,000.00
3,000.00
4,000.00
5,000.00
6,000.00
7,000.00
3,265.21 3,441.973,789.83
5,942.766,412.05
Net Worth
Interpretation :
Net worth of the bank was increased with increasing rate from
2005 to 2008, in 2008 it was increased by around 57%
compare to 2007, but in 2009 the increasing rate was became
around 8%.
Mar '05 Mar '06 Mar '07 Mar '08 Mar '090.00
20,000.00
40,000.00
60,000.00
80,000.00
100,000.00
120,000.00
140,000.00
60,751.6766,482.65
82,776.28
110,319.67
131,271.85
Deposits
Interpretation :
The amount of the deposits is also increased with increasing
rate till 2008 but in 2009 the growth rate was fall by 19%.
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 115
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
Mar '05 Mar '06 Mar '07 Mar '08 Mar '090.00
10,000.00
20,000.00
30,000.00
40,000.00
50,000.00
60,000.00
70,000.00
80,000.00
90,000.00
27,277.32
37,483.48
51,795.47
72,997.43
85,483.20
Advances
Interpretation :
The amount of advances of bank is increased by year to year,
and in 2009 it was increased by about 17%
Mar '05 Mar '06 Mar '07 Mar '08 Mar '090.00
5,000.00
10,000.00
15,000.00
20,000.00
25,000.00
30,000.00
35,000.00
40,000.00
45,000.00
50,000.00
30,834.7628,639.09 27,741.89
31,455.19
43,060.72
Investments
Interpretation :
The amount of the investment is also increased with increasing
rate in 2009 it was increased by 37% compare to previous year
PROFIT & LOSS A/C OF THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 11
6
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
CENTRAL BANK OF INDIA AS WHOLE(Amt in CR)
INCOMEMar '05
Mar '06
Mar '07
Mar '08
Mar '09
Interest Earned 5,204.88
5,385.58
6,234.21
7,995.54
10,455.19
Other Income 938.87 551.24 561.83 902.35 1,069.97
Total Income 6,143.75
5,936.82
6,796.04
8,897.89
11,525.16
EXPENDITUREMar '05
Mar '06
Mar '07
Mar '08
Mar '09
Interest expended 2,829.93
3,005.51
3,759.79
5,772.47
8,226.72
Employee Cost 1,277.56
1,275.74
1,175.42
1,214.34
1,272.59
Selling and Admin Expenses
804.55 296.00 701.64 563.59 653.17
Depreciation 53.17 50.90 65.00 73.61 83.59Miscellaneous Expenses
877.04 1,051.26
596.18 723.71 717.86
Preoperative Exp Capitalised
0.00 0.00 0.00 0.00 0.00
Operating Expenses 2,284.57
1,782.22
2,133.16
2,034.89
2,184.05
Provisions & Contingencies
727.75 891.68 405.08 540.36 543.16
Total Expenses 5,842.25
5,679.41
6,298.03
8,347.72
10,953.93
Net Profit for the Year
301.50
257.42
498.01
550.16 571.24
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 117
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
(The amounts in the following charts are in CR)
Mar '05 Mar '06 Mar '07 Mar '08 Mar '090.00
2,000.00
4,000.00
6,000.00
8,000.00
10,000.00
12,000.00
5,204.88 5,385.586,234.21
7,995.54
10,455.19
Interest Earned
Mar '06 Mar '07 Mar '08 Mar '090.0
5.0
10.0
15.0
20.0
25.0
30.0
35.0
3.5%
15.8%
28.3%30.8%
Interest Earned
Interpretation :
The amount of interest earned was increases with increasing
rate
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 118
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
It was increased by 31% in 2009 compare to 2008. So it shows
the healthiness condition of bank.
Mar '05 Mar '06 Mar '07 Mar '08 Mar '090.00
2,000.00
4,000.00
6,000.00
8,000.00
10,000.00
12,000.00
14,000.00
6,143.75 5,936.826,796.04
8,897.89
11,525.16
Total Income
Mar '06 Mar '07 Mar '08 Mar '09
-10
-5
0
5
10
15
20
25
30
35
-3.4%
14.5%
30.9% 29.5%
Total Income
Interpretation :
Due to increases in interest earnings the income of the bank
also increases, but here the increasing rate with compare to
previous year is almost equal for both 2008 and 2009, it is
around 30%.
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 119
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
Mar '05 Mar '06 Mar '07 Mar '08 Mar '090.00
1,000.00
2,000.00
3,000.00
4,000.00
5,000.00
6,000.00
7,000.00
8,000.00
9,000.00
2,829.93 3,005.513,759.79
5,772.47
8,226.72
Interest expended
0
10
20
30
40
50
60
6.2%
25.1%
53.5%
42.5%
Interest expended
Interpretation :
The amount of interest expended is also increases, but it is
increases with decreasing rate because in 2008 it was
increased by 54%, while in 2009 it was increased by 42%.
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 120
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
Mar '05 Mar '06 Mar '07 Mar '08 Mar '090.00
500.00
1,000.00
1,500.00
2,000.00
2,500.002,284.57
1,782.22
2,133.16 2,034.892,184.05
Operating Expenses
Mar '06 Mar '07 Mar '08 Mar '09
-25
-20
-15
-10
-5
0
5
10
15
20
25
-22%
19.7%
-4.6%
7.3%
Operating Expenses
Interpretation :
The operating expenses of the bank is on fluctuating rate
because in 2008 it was decreased by 5% while in 2009 it was
increased by 7%.
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 121
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
Mar '05 Mar '06 Mar '07 Mar '08 Mar '090.00
2,000.00
4,000.00
6,000.00
8,000.00
10,000.00
12,000.00
5,842.25 5,679.416,298.03
8,347.72
10,953.93
Total Expenses
Mar '06 Mar '07 Mar '08 Mar '09-5
0
5
10
15
20
25
30
35
-2.8%
10.9%
32.5% 31.2%
Total Expenses
Interpretation :
As increases in working of the bank the total expenditure of the
bank is also increases, but good things was that in 2008 it was
increased by 33% while in 2009 it was increased by 31%.
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 122
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
Mar '05 Mar '06 Mar '07 Mar '08 Mar '090
100
200
300
400
500
600
301.5 257.419999999999
498.01550.16 571.24
Net Profit for the Year
Mar '06 Mar '07 Mar '08 Mar '09
-40
-20
0
20
40
60
80
100
120
-14.6%
93.5%
10.5%3.8%
Net Profit for the Year
Interpretation :
The amount of profit of the bank was increased by decreasing
rate the reason behind it may be that the rate of growth in total
income was decreased or almost equal but the rate of
employee cost and administrative cost were increased
Other reason may be that the other income of the bank in 2008
grow by 60% while in 2009 it was grow just by 18% so it may
cut the total income of the bank.
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 123
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
NET PROFIT MARGIN
Net profit margin= Net Profit before interest and taxes *
100
Sales (operation)
2005 2006 2007 2008 2009
6.21 4.92 7.69 6.31 4.99
2005 2006 2007 2008 20090
1
2
3
4
5
6
7
8
9
6.21
4.92
7.69
6.31
4.99
Net profit margin
Interpretation :
The net profit margin arising from business operation before
interest and tax is deducted. The convention is to express profit
as a percentage of total operation of the bank.
Here the profit margin is declining so it is not good for the bank
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 124
RATIO ANALYSISRATIO ANALYSIS4.64.6
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
RETURN ON NET WORTH
Return on net worth= Net Profit after interest and taxes *
100
Net worth
2005 2006 2007 2008 2009
11.65 9.07 15.89 15.46 14.43
2005 2006 2007 2008 20090
2
4
6
8
10
12
14
16
18
11.65
9.07
15.89 15.4614.43
Return on Networth
Interpretation :
This ratio expresses the net profit in terms of the equity
shareholders funds. This ratio indicates the return on the funds
employed by them
Here there is not much more different in the return on Networth
since last three years so it is good sign for the bank.
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 125
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
RETURN ON ASSETS
Return on Assets= Net Profit after taxes * 100
Total Assets
2005 2006 2007 2008 2009
0.44 0.34 0.54 0.44 0.39
2005 2006 2007 2008 20090
0.1
0.2
0.3
0.4
0.5
0.6
0.44
0.34
0.54
0.44
0.39
Return on Assets
Interpretation :
The profitability of the firm is measured by establishing relation
of net profit with the total assets of the organization. The ratio
indicates the efficiency of utilization of assets in generating
revenue
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 126
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
Debt-equity ratio
Debt-equity ratio= Long term debt
Share holders equity
2005 2006 2007 2008 2009
18.65:1 19.41:1 22.05:1 18.64:1 20.60:1
2005 2006 2007 2008 200916
17
18
19
20
21
22
23
18.65
19.41
22.05
18.64
20.6
Debt-Equity Ratio
Interpretation :
This ratio shows the relationship between the loan fund and
networth of the company. It shows the proportion of the dedts
or borrowing funds to owner’ fund, Here the ratio is high in
2009 compare to 2008 which is not good sign for the bank.
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 127
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
DEBT TO TOTAL ASSETS RATIO
Debt to total assets ratio= Total Debt
Total Assets
2005 2006 2007 2008 2009
0.89:1 0.89:1 0.90:1 0.89:1 0.89:1
2005 2006 2007 2008 20090.884
0.886
0.888
0.89
0.892
0.894
0.896
0.898
0.9
0.902
0.89 0.89
0.9
0.89 0.89
Debt to Assets ratio
Interpretation :
This ratio indicates that what proportion of the permanent
capital of the firm consist of long term debt. Here the
proportion is same since last two years which shows the
stability of the bank.
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 128
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
INTEREST EXPENSE RATIO
Interest expense ratio= Interest expense * 100
Income
2005 2006 2007 2008 2009
46.06% 50.62% 55.32% 64.87% 71.38%
2005 2006 2007 2008 20090
10
20
30
40
50
60
70
80
46.0650.62
55.32
64.8771.38
Interest Expense Ratio
Interpretation :
This Ratio indicates that what is the proportion of the total
interest expenses to the Income. So that we can know about
profitability of firm. Here the proportion of the expenditure is
increases so it may caused in the decreasing rate of profit.
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 129
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
OPERATING EXPENSES RATIO
Operating expenses ratio= Operating Expenses *100
Income
2005 2006 2007 2008 2009
37.19% 30.02% 31.39% 22.87% 18.95%
2005 2006 2007 2008 20090
5
10
15
20
25
30
35
40 37.19
30.0231.39
22.87
18.95
Operating Expense Ratio
Interpretation :
This Ratio indicates that how much expenses has been spent
on selling and administration use of organization. This Ratio
indicates that what is the proportion of the total Operating
expenses to the Income. So that we can know about
profitability of firm. Here the proportion of the operating
expenditure is decreases so it is good sign for the bank, and it
also shows the increases in the level of efficiency and utilization
of resources
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 130
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
INTEREST EXPENDED/INTEREST EARNED
Interest Expended/Interest Earned= Interest Expended
*100
Interest Earned
2005 2006 2007 2008 2009
54.37% 55.81% 60.31% 72.20% 78.69%
2005 2006 2007 2008 20090
10
20
30
40
50
60
70
80
90
54.37 55.8160.31
72.278.69
Interest Exp/Interest Ernd
Interpretation :
This ratio indicates the proportion of the total interest
expended into the total interest earned. Means if in 2009 if the
bank earned 100 rs as interest than they paid rs 79 as interest
expended
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 131
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
RETURN ON SHARE HOLDERS’ FUNDS
Return on share holders’ funds= Profit after tax * 100
Share holders funds
2005 2006 2007 2008 2009
13.41% 11.45% 22.15% 22.84% 21.62%
2005 2006 2007 2008 20090
5
10
15
20
25
13.4111.45
22.15 22.8421.62
Return on Share holders' fund
Interpretation :
Indicates the percentage return on share holders’ funds, from
the above chart we can says that the rate of return on fund is
about constant since last three years so it is good things for the
bank point of view
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 132
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 133
FINDINGS &
CONCLUSION
Chapter 6
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
FINDINGS & CONCLUSIONFINDINGS & CONCLUSION
PERFORMANCE OF THE CENTRAL BANK OF INDIA, LAL DARWAJA
Performance of the bank according to Profit & Loss A/c
Overall rating of the Profit & Loss A/c
(Best condition 5…4…3…2…1 Poor condition)
Criteria 2005
2006
2007
2008
2009
Average
Profit 3 3 4 5 1 3.2Interest Earned 2 2 3 3 5 3Other income 2 3 3 3 4 3Total income 2 2 3 3 5 3Interest Expended 3 3 3 2 1 2.4Operating Expenses 3 2 2 2 1 2Total expenditure 3 3 3 2 1 2.4
Performance of bank out of 100%
Profit
Interes
t Ear
ned
Other
inco
me
Total
inco
me
Interes
t Exp
ended
Operati
ng Exp
ense
s
Total
expen
diture
0
10
20
30
40
50
60
70 64%60% 60% 60%
48%40%
48%
From the above table we can easily find out the overall performance
of the bank
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 134
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
If we talk about the overall profitability condition of the bank is
around average condition because it falls at around 3.2 rating
out of 5 which is quite near to the average
The income level of the central bank of India is quite better in
2009, the income from interest and other income is around
best position, it is 5 and 4 respectively. Which show the better
position in income earning, And if we talk about the overall
income position then it is around average.
The expenditure level was increased with increasing rate the
overall rating of the expenses is into between poor and average
which show the poor condition of the bank
Performance of the bank according to Balance sheet
Overall rating of balance sheet
(Best condition 5…4…3…2…1 Poor condition)
Criteria 2005
2006
2007
2008
2009
Average
Advances 3 2 3 3 4 3Current A/c 2 3 3 4 3 3Saving A/c 3 2 3 3 4 3Time Deposit 2 2 2 3 5 2.8
Performance of bank out of 100%
Advances Current A/c Saving A/c Time Deposit54
55
56
57
58
59
60
61
60% 60% 60%
56%
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 135
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
The level of advances increased with increasing rate in 2009 it
was in better position, if we talk about the overall performance
of the bank in case of level of advances then it is around
average
The amount of deposits was also increased with increasing
rate, when we talk about the average performance of bank for
last five year then the position of current deposits, saving
deposits and demand deposits fall in the average category.
PERFORMANCE OF PERFORMANCE OF THE CENTRAL BANK OF INDIA AS WHOLETHE CENTRAL BANK OF INDIA AS WHOLE
Performance of the bank according to profit & Loss A/c
Overall rating of the Profit & Loss A/c
(Best condition 5…4…3…2…1 Poor condition)
Criteria 2005
2006
2007
2008
2009
Average
Interest Earned 2 2 3 3 4 2.8Total Income 2 2 3 3 4 2.8Interest expended 3 3 3 2 1 2.4Operating Expenses 3 3 3 3 3 3Total Expenses 4 4 3 3 1 3Net Profit for the Year 2 2 3 4 4 3
Performance of bank out of 100%
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 136
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
Interest Earned Total Income Interest expended
Operating Expenses
Total Expenses Net Profit for the Year
0
10
20
30
40
50
60
70
56% 56%
48%
60% 60% 60%
From the above table we can say that the overall condition of the
central bank of India is at the average position because the rating
fall at the average or near to average spot for all criteria
Performance of the bank according to Balance sheet
Overall rating of balance sheet
(Best condition 5…4…3…2…1 Poor condition)
Criteria 2005 2006 2007 2008 2009 Average
Net Worth 2 2 2 4 4 2.8Deposits 2 2 3 4 4 3Advances 1 2 3 4 5 3Investments 3 3 3 3 4 3.2Total Assets 2 2 3 4 4 3
Performance of bank out of 100%
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 137
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
Net Worth Deposits Advances Investments Total Assets52
54
56
58
60
62
64
66
56%
60% 60%
64%
60%
Over all performance
From the above chart we can say that the overall position of the
central bank of India is average
NOTE
The rating of each criteria is given on the bases of the average of the
five consecutive year
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 138
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 139
RECOMMENDATION
Chapter 7
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
RECOMMENDATIONRECOMMENDATION
Bank should improve the performance in case of the
facility provided to the current account holder, because
the facility provided by the bank is not very good.
The dependability of the bank on out side fund is very
high and so it may be very dangerous for the bank.
If the bank wants to maintain their reputation then they
have to improve the profitability by reducing the
maximum cost.
The infrastructural facility of the bank is very poor,
because they till working with the old infrastructural
facility
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 140
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
BIBLIOGRAPHYBIBLIOGRAPHY
BOOKS:
Financial Management – M. Y. Khan & P. K.
Jain
Financial Management – I. M. Pandey
Management Accounting – R. S. N. Pillai and
Bagvati
REFERENCES:
Indian banking system
India banking 2010
Search engines – Google & Yahoo
www.Centralbankofindia.co.in
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 141
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
ANNEXURECENTRAL BANK OF INDIA
LAL-DARWAJA, SURAT-395003PROFIT & LOSS A/C FOR THE HALF YEAR ENDED 31-3-2008
PARTICULAR AMOUNT Ps.TOTAL
AMOUNTPs.
(A) INCOME: - (1) Interest earned :--
<i> Interest on Advances other than Bank:
- Term Loans 40,65,337 23 - Demand Loans 2,44,360 95 - Cash Credits 4,55,539 08 - Over Draft 8,00,261 06 - Export / Import Loans - - - Other
Sub-Total<i> -------------- ---- 55,65,487 37
<ii> Interest on Advances to Banks:
- -
<iii>Interest on Bills Purchased / Discounted :
- Interest on bill purchased / discounted / Negotiated (Inland) 3227 00
- Int. on bills purchased / Discounted / Negotiated (Foreign)
- -
- Overdue Interest on T.T. Discounted by others banks.
- -
Sub-Total <iii> -------------- ---- 3227 00
<iv>Discount on Bills, TTS etc. - - - -<v> Income on Investment (C.O.
Item)- - - -
<vi>Interest on Balances with reserve Bank of India
- - - -
<vii> Others: - Interest Received from
Branches / NBO - Interest Received from central
office. 2,03,63,474 00
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 142
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
Sub-Total<vii> -------------- ---- 2,03,63,474 00 Total Interest Earned:-
- -2,59,28,97
137
(2) Other Income:--
<i> Commission Exchange Income:
(a)Commission / Brokerage :- - Bill for collection 29,270 00 - Letter of credit - - - Letter of guarantee(DPG) 28,177 35 - Bill purchase - Payment of dividend - - - Safe custody Accounts - - - Sales & Purchase of Shares &
Securities- -
- Under writing commission - - - Incident / Service charges 4,62,121 01 - Processing charges 86,790 00 - Government Business
Transaction - -
- Commission on travelers cheques
- -
- Commission on bank assurance-life
2,382 00
- Commission on bank assurance non-life
5,820 00
- Commission on mutual fund poducts
1,409 91
Sub-Total(a) -------------- ---- 616970 27 (b) Commission / Brokerage
(Foreign):- - Bill for collection - - - Letter of credit [export] - - - Letter of credit [Import] - Letter of guarantee / DPG - - - Bill purchased Discounted - -
Sub-Total(b) -------------- ---- - - (c) Exchange:- - DD / TT (Inland) 2,58,983 19 - DD / TT (Foreign) - -
Sub-Total(c) -------------- ---- 2,58,983 19Total of commission , Exchange & Brokerage (a + b + c)
- -8,75,953 46
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 143
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
<ii> Profit / Loss on sales of Investments (C.O. Item)
- -
<iii> Profit & Loss on Revaluation of Investment
- -
<iv> Profit & Loss on sale of land, Buildings & Other Assets.
- -
<v> Profit & Loss on Exchanges Transactions
- -
<vi> Income Earned by way of dividends etc. From subsidiary and/or joint ventures abroad / in India.
- -
<vii> Miscellaneous Income: - - Rent of safe Deposit Lockers 2,26,977 - Recovery received in accounts
written off- -
- Rent received from occupants of bank’s own premises
- -
- Others 1,446 80Total of other income ( i to vii) -------------- ---- 11,04,376 46
TOTAL INCOME (1+2)- -
2,70,33,347
83
PARTICULAR AMOUNT PsTOTAL
AMOUNTPs
2,39,49,366 95
(B) EXPENDITURE:- (3) Interest Expected :-
<1> Interest on Deposit : (a) Banks :- - Demand Deposits - - - Term Deposit - -
Sub-Total (a) ------------- ---- - - (b) Others :- 1. Interest on Saving Deposit: 32,29,747 26 2. Interest on Term Deposits: - Interest on Fixed Deposit 3,61,521 54 - Interest on Quarterly Deposit 3,79,189 10
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 144
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
- Interest on Money Multiplier Deposit 69,63,617 12
- Interest on Recurring Deposit 24,549 60 - Interest on Khazana Deposit - Interest on FCNR(B) Deposit 2,51,505 62 - Interest on Certificate of Dep. - - - Interest on Other Term Deposit 1,84,753 80
Total of 2. -------------- ---- 81,65,136 84 Sub Total(a + b) 1,13,94,884 04
<ii> Interest on Reserve Bank of India / Inter Bank Borrowings
- - - -
<iii> Interest Paid to Others - - - - - Interest on Borrowing paid to - -
<iv> Others :- - Interest Paid to Branches / NBO - - - Interest paid to Central office 70,72,628 00
Sub-Total<iv> -------------- ---- 70,72,628
Total Interest Expended ( i to iv)-------------- ----
1,84,67,512
04
(4) Operating Expenses :-
<i> Payments to and Provisions for Employees:
- Basic pay / Personal pay 19,79,448 00 - Special Pay 1,79,672 12 - Dearness Allowances 6,92,567 00 - City compensatory Allowances 55,691 19 - House Rent Allowances 1,53,756 70 - Medical Aid 52,343 50 - Leave fare concession 10,576 00 - Leave Encashment 91,456 69 - Bonus 16,460 00 - Other Expenses 23,321 55 - Staff Welfare Expenses - Contribution to provident fund 44,645 00 - Ex-gratia paid to pre. 1986
retirees (C.O. Item)- -
Sub Total <i> -------------- ---- 33,96,050 16
<ii> Rent, Taxes and Lighting :-
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 145
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
- Rent paid for office premises 1,99,368 00 - Rent paid for other premises 23,400 00 - Municipal / other Taxes on
bank’s property - Lighting generator Expenses 68,860 00
Sub Total <ii> -------------- ---- 2,91,628 93<iii> Printing & Stationary 31,285 59
<iv> Advertisement & publicity
<v> Depreciation on Bank’s property ( C.O. Item) : -
- Depreciation on building - - - Depreciation on Furniture &
fixtures - -
Sub Total<v> -------------- ---- - -
<vi> Director’s Fees Allowances & Expenses
- -
<vii> Auditor’s fees & Expenses :-
- Statutory central Auditors - - - Branch Auditors - - - Traveling and others expenses - -
Sub Total <vii> -------------- ---- - -
<viii> Law charges 3,57,942 00
<ix> Postages, Telegrams, Telephones etc.:-
- Postage & Telegrams 4,142 00 - Telephones & Telex / Fax 3,697 00 - Amount paid for leased line 3,816 00
Sub Total <ix> -------------- ---- 8,365 00
<x> Repairs & Maintenance : - - Bank’s own property - - - Furniture & Fixtures 7,525 00 - Annual maintenance charge 4,264 00
Sub Total <x> -------------- ---- 11,889 00
<xi> Insurance: - - Insurance - - - Deposit Insurance - -
Sub Total <xi> -------------- ---- - -
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 146
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
<xii> Other Expenditure:- - Traveling exp. 22,096 18 - Boarding exp. 4,326 00 - Local conveyance paid /
Reimbursed 21,748 00 - Diem allowances paid-officer 17,355 00 - Diem allowances paid-clerk 8,000 00 - Diem allowances paid-sub staff 780 00 - Reimbursement of conveyance
Exp. To eligible officers - Petrol Exp. For motors vehicles - - - Maintenance Exp. Of Transit
House- -
- Entertainment Exp. - Hospital exp. 5,913 50 - Wages paid to sweepers and
casual labor 3,460 00 - Petty cash Expenses 5,781 16 - Currency chest guarding exp. 2,70,000 00 - Clearing House Charges 1,14,035 00 - Fees for Revenue / Concurrent /
other Auditors 98,452 00 - Professional Fees paid - - - Premium paid to ECGC & other
corporations - -
- News papers / Journals 4,847 00 - Donations to Institution - - - Others 12,594 93
Sub Total <xii> -------------- ---- 5,94,388 71
<xiii> Provisions and Contingencies
- -
Total Operating Expenses <i to xii>
46,91,548 46
TOTAL EXPENDITURE ( 3 + 4 )-------------- ----
2,31,59,060
86
PROFIT BALANCE ( A – B ) 38,74,287 14
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 147
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
CENTRAL BANK OF INDIALAL-DARWAJA, SURAT-395003
COMPARATIVE BALANCE SHEET STATEMENT FOR THE 3 YRS
PARTICULAR 2007 2008 2009
(A) CAPITAL AND LIABILITIES :-
(1) Capital (Fully owned by central Government)
(2) Reserves & surplus
(3) Deposits:-<I> Demand Deposit :- - Current / call Deposit a. From Bank b. From Others 7,66,96,927 9,26,66,535 73335300
<II> Saving Bank Deposits 18,08,81,307 19,88,34,956 234270014
<III> Term Deposit :- a. From Bank b. From Others:- - Fixed Deposits 1,04,58,175 1,08,30,348 4067737 - QID 1,43,19,795 1,54,89,177 28318799 - MMD 15,64,35,938 21,99,69,789 440504862 - Cent uttam Deposit 1,93,686 1,93,686 193686 - Recurring Deposit 8,71,946 7,38,298 860660 - FNCR 55,68,522 5445660 1461073 - Certificate of Deposit - Other Term Deposit 41,65,526 50,57,513 10350157
Total Deposit(3) 44,95,97,826 54,92,25,958 793249310
(4) Borrowing
(5) Other Liabilities &
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 148
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
Provisions.<I> Bills Payable : - Bills payable / MIS Payable - T.T.’S Payable - Pay slips / Banker’s cheques
Issued. 18,25,445 30,47,703465980
- Others 1,414 1,414 1414
<II> Inter-Office , Adjustment (Net) i.e. Branch Adjustment)
<III> Interest Accrued : - On Deposits 17,12,343 20,82,337 2522608 - On Borrowings<IV> Other Liabilities:- - Accrued Expenses 40,900 40,000 106600 - Reversal of Unrealized ,
Interest 1,12,392 1,12,392 237778 - Amount received from court
Receiver / Borrowers & held pending adjustments 1,60,696 1,60,696
- Income tax & other Taxes to be remitted 4,41,210 1327607
- Commission on guaranteed LC 1,15,468 1,25,744 128300
- Advance rent Reserved from locker holder. 3,19,510 2,83,837 320368
- Others 71,049 1,97,528 237662
Total other Liabilities & Provisions(5) 43,68,593 64,83,486 5348317
TOTAL 45,39,66,419
55,57,09,445 798597627
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 149
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
PARTICULAR 2007 2008 2009
(B) ASSETS: (6) Cash & Balances with
Reserve Bank of India:-<I> Cash : - In Hand 57,41,098 71,86,591 15013378 - In Foreign Currency Notes
<II> Balance with Reserve Bank of India :
- Incurrent Account - In other Account
Total of (6) 57,41,098 71,86,591 15013378
(7) Balance with Banks And Money at call and short notice:
- In India - out side in India
(8) Investments:(9) Advances: <I> Bill purchased and
discounted33,60,423 31,82,025
3163004<II> Cash credits, overdraft, &
loan repayable on demand - Cash credit 4,79,01,002 4,74,63,883 51019908 - Overdraft 4,50,33,805 4,73,57,980 50128530 - Loan repayable on demand 43,65,180 49,53,204 5078500<III> Term loan 9,70,48,629 11,65,89,119 135680795
Total Advances(9) 19,77,09,042
21,95,46,212 241907733
(10) Fixed Assets:- - Premises (C.O. Item)
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 150
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
- Other Fixed Assets ( Including furniture &
Fixtures) 36,24,509 36,54,074 3455597Total Fixed Asset(10) 36,24,509 36,54,074 3455597
(11) Other Assets:-<I> Other Assets:- - Inter office Adjustment i.e. Branch Adjustment 24,61,58,808 32,43,38,322 537180116 - Stationary and stamps on
hand 1,11,871 1,51,979153379
<II> Amount Not in the Nature of Advances :-
- Prepaid expenses 11,000 11,000 - Advance to staff 15000 - Interest free advances to
staff 57,76,50 4,71,450317693
- Deposit with Government and other Departments 9,850 9,850
9850
- Staff loan advance 21700 - On account payments made
to other16250
- Advance payment to land lord of office and other premises 20,100 11,700
31900
- Amount paid to pensioners 1,14,080 - Difference in clearing 2,14,163 107990 - Others 2210 336313 - Miscellaneous Inter Branch
Transactions (MIBT):-a. cash b. Funds Transferred.c. Staff and Advance
against LFC, TA, Salary etc.
d. Letter of credit claimed e. D.D.s issued by other
Banks paid f. other transaction 2,400 30728
- Share Application money
Total of other Assets(11)24,68,91,68
032,43,22,56
7 538220919
TOTAL45,39,66,41
955,57,09,44
5 798597627
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 151
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
CENTRAL BANK OF INDIALAL-DARWAJA, SURAT-395003
COMPARATIVE PROFIT & LOSS A/C FOR THE 3 YRS
PARTICULAR 2007 2008 2009(A) INCOME: -
(1) INTEREST EARNED :--
<i> Interest on Advances other than Bank:
- Term Loans 19,31,691 40,65,337 5927523 - Demand Loans 2,19,085 2,44,360 216384 - Cash Credits 5,42,000 4,55,539 128102 - Over Draft 7,60,352 8,00,261 978901 - Export / Import Loans - - Other
Sub-Total<i> 34,53,099 55,65,487 7250910
<ii> Interest on Advances to Banks:
-
<iii>Interest on Bills Purchased / Discounted :
- Interest on bill purchased / discounted / Negotiated (Inland) 3,227
- Int. on bills purchased / Discounted / Negotiated (Foreign)
-
- Overdue Interest on T.T. Discounted by others banks.
-
Sub-Total <iii> 3,227
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 152
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
<iv>Discount on Bills, TTS etc. - -<v> Income on Investment (C.O.
Item)- -
<vi>Interest on Balances with reserve Bank of India
- -
<vii> Others: - Interest Received from
Branches / NBO - Interest Received from central
office. 1,63,38,545 2,03,63,474 32063360Sub-Total<vii>
1,63,38,5452,03,63,47
432063360
TOTAL INTEREST EARNED:- 1,97,94,8712,59,28,97
1 393142702) OTHER INCOME:--
<i> Commission Exchange Income:
(a)Commission / Brokerage :- - Bill for collection 37,042 29,270 19247 - Letter of credit - - Letter of guarantee(DPG) 84,500 28,177 7451 - Bill purchase - Payment of dividend - - Safe custody Accounts - 500 - Sales & Purchase of Shares &
Securities-
- Under writing commission - - Incident / Service charges 5,66,506 4,62,121 - Processing charges 2,05,069 86,790 984341 - Government Business
Transaction -
- Commission on travelers cheques
-
- Commission on bank assurance-life
2,3825000
- Commission on bank assurance non-life
25,825 5,82012919
- Commission on mutual fund poducts
1,410
Sub-Total(a) 9,18,942 616970 1029459 (b) Commission / Brokerage
(Foreign):- - Bill for collection - - Letter of credit [export] - - Letter of credit [Import]
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 153
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
- Letter of guarantee / DPG - - Bill purchased Discounted -
Sub-Total(b) -------------- - (c) Exchange:- - DD / TT (Inland) 2,77,269 2,58,983 290320 - DD / TT (Foreign) -
Sub-Total(c) 2,77,269 2,58,983 290320Total of commission , Exchange & Brokerage (a + b + c) 11,96,210 8,75,953 1319779
<ii> Profit / Loss on sales of Investments (C.O. Item)
-
<iii> Profit & Loss on Revaluation of Investment
-
<iv> Profit & Loss on sale of land, Buildings & Other Assets.
-
<v> Profit & Loss on Exchanges Transactions
-
<vi> Income Earned by way of dividends etc. From subsidiary and/or joint ventures abroad / in India.
-
<vii> Miscellaneous Income: - - Rent of safe Deposit Lockers 2,22,747 2,26,977 198869 - Recovery received in accounts
written off-
- Rent received from occupants of bank’s own premises
-
- Others 241 1,446Total of Miscellaneous Income 2,22,988 2,28,423 198869
TOTAL OF OTHER INCOME ( I TO VII) 14,19,198 11,04,376 1518648
TOTAL INCOME (1+2) (A) 2,12,14,0692,70,33,34
7 40832918
PARTICULAR 2007 2008 2009(B) EXPENDITURE:-
(3) INTEREST EXPECTED :-
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 154
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
<1> Interest on Deposit : (a) Banks :- - Demand Deposits - - Term Deposit -
Sub-Total (a) ------------- - (b) Others :- 1. Interest on Saving Deposit: 30,32,755 32,29,747 3732257 2. Interest on Term Deposits: - Interest on Fixed Deposit 3,43,883 3,61,521 120843 - Interest on Quarterly Deposit 3,40,490 3,79,189 947008 - Interest on Money Multiplier
Deposit 43,76,405 69,63,617 19719599 - Interest on Recurring Deposit 87,978 24,549 22879 - Interest on uttam Deposit 14,810 - Interest on FCNR(B) Deposit 20,57,161 2,51,505 - Interest on Certificate of Dep. - - Interest on Other Term Deposit 1,00,533 1,84,753 400864
Total of 2. 54,69,815 81,65,136 21211193 Sub Total(a + b)
85,04,5701,13,94,88
4 24943450
<ii> Interest on Reserve Bank of India / Inter Bank Borrowings
- -
<iii> Interest Paid to Others - - - Interest on Borrowing paid to -
<iv> Others :- - Interest Paid to Branches / NBO - - Interest paid to Central office 49,80,865 70,72,628 9450917
Sub-Total<iv> 49,80,865 70,72,628 9450917
TOTAL INTEREST EXPENDED ( I TO IV) 1,34,85,435
1,84,67,512 34394367
(4) OPERATING EXPENSES :-
<i> Payments to and Provisions for Employees:
- Basic pay / Personal pay 21,14,272 19,79,448 2499604 - Special Pay 1,76,024 1,79,672 214447 - Dearness Allowances 5,57,341 6,92,567 1195133 - City compensatory Allowances 66,203 55,691 60884 - House Rent Allowances 1,60,099 1,53,756 164476
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 155
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
- Medical Aid 98,803 52,343 135792 - Leave fare concession 28,639 10,576 41200 - Leave Encashment 5,44,248 91,456 52076 - Bonus 5,824 16,460 4793 - Other Expenses 22,280 23,321 34510 - Staff Welfare Expenses - Contribution to provident fund 91,849 44,645 108610 - Ex-gratia paid to pre. 1986
retirees (C.O. Item)-
Sub Total <i> 33,75,763 33,96,050 4511525
<ii> Rent, Taxes and Lighting :- - Rent paid for office premises 1,49,526 1,99,368 284143 - Rent paid for other premises 27,300 23,400 74400 - Municipal / other Taxes on
bank’s property - Lighting generator Expenses 67,983 68,860 86849
Sub Total <ii> 4,51,987 2,91,628 445392<iii> Printing & Stationary 40,024 31,285 155505
<iv> Advertisement & publicity
<v> Depreciation on Bank’s property ( C.O. Item) : -
- Depreciation on building - - Depreciation on Furniture &
fixtures -
Sub Total<v> -------------- -
<vi> Director’s Fees Allowances & Expenses
-
<vii> Auditor’s fees & Expenses :-
- Statutory central Auditors - - Branch Auditors - - Traveling and others expenses -
Sub Total <vii> -------------- -
<viii> Law charges 11,700 3,57,942 6584
<ix> Postages, Telegrams, Telephones etc.:-
- Postage & Telegrams 13,696 Cr 4,142 Cr 6764 - Telephones & Telex / Fax 15,516 Dr 3,697 Dr 14073 - Amount paid for leased line 3,810 Dr
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 156
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
Sub Total <ix> 1,820 8,365 20837
<x> Repairs & Maintenance : - - Bank’s own property - - Furniture & Fixtures 39,105 7,525 47892 - Annual maintenance charge 4,264 5313
Sub Total <x> 39,105 11,889 53205
<xi> Insurance: - - Insurance 4,895 - - Deposit Insurance -
Sub Total <xi> 4,895 -------------- -
<xii> Other Expenditure:- - Traveling exp. 17,493 22,096 136422 - Boarding exp. 893 9,326 8736 - Local conveyance paid /
Reimbursed 3,356 21,74835663
- Diem allowances paid-officer 31,760 17,355 4575 - Diem allowances paid-clerk 30,595 8,000 - Diem allowances paid-sub staff 780 - Reimbursement of conveyance
Exp. To eligible officers 56,81580
- Petrol Exp. For motors vehicles - - Maintenance Exp. Of Transit
House-
- Entertainment Exp. - Hospital exp. 1,956 5,913 4341 - Wages paid to sweepers and
casual labor 16,635 3,4601414
- Petty cash Expenses 14,010 5,781 20415 - Currency chest guarding exp. 2,70,000 53414 - Clearing House Charges 66,140 1,14,035 78643 - Fees for Revenue / Concurrent /
other Auditors 69,649 98,45280895
- Professional Fees paid - - Premium paid to ECGC & other
corporations -
- News papers / Journals 4,567 4,847 6252 - Donations to Institution - - Others 24,222 12,594 1614
Sub Total <xii> 3,48,639 5,94,388 432464
<xiii> Provisions and Contingencies
-
TOTAL OPERATING EXPENSES 42,71,936 46,91,548 5625512
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 157
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
<I TO XII>
TOTAL EXPENDITURE ( 3 + 4 ) (B)
1,77,57,3712,31,59,06
040019879
PROFIT BALANCE ( A – B ) 34,56,698 38,74,287 813039
BALANCE SHEET OF THE CENTRAL BANK OF INDIA AS WHOLE
( In Crore)
LIABILITIES
MAR '05
MAR '06
MAR '07
MAR '08
MAR '09
Total Share Capital
1,124.14
1,124.14
1,124.14 1,204.14 1,321.14
Equity Share Capital
1,124.14
1,124.14 324.14 404.14 404.14
Preference Share Capital 0.00 0.00 800.00 800.00 917.00
Reserves1,617.5
01,810.1
92,179.8
4 2,699.95 3,081.99Revaluation Reserves 523.57 507.64 485.85 2,038.67 2,008.92
Net Worth3,265.2
13,441.9
73,789.8
3 5,942.76 6,412.05
Deposits60,751.
6766,482.
6582,776.
28110,319.
67131,271.
85Borrowings 139.69 310.81 782.01 449.10 804.25
Total Debt60,891.
3666,793.
4683,558.
29110,768.
77132,076.
10Other 4,439.3 4,445.6 5,659.9 7,244.26 9,167.07
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 158
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
Liabilities & Provisions 2 1 7
Total Liabilities
68,595.89
74,681.04
93,008.09
123,955.79
147,655.22
ASSETSMAR '05
MAR '06
MAR '07
MAR '08
MAR '09
Cash & Balances with RBI
5,571.81
3,382.86
5,473.67
11,537.19
11,036.91
Balance with Banks, Money at Call
1,481.13
1,411.23
3,339.22 1,302.05 1,214.34
Advances27,277.
3237,483.
4851,795.
4772,997.4
385,483.2
0Investments
30,834.76
28,639.09
27,741.89
31,455.19
43,060.72
Gross Block1,333.1
21,369.1
21,483.0
4 3,119.80 3,181.69Accumulated Depreciation 580.96 644.28 715.77 799.51 903.70Net Block 752.16 724.84 767.27 2,320.29 2,277.99
Other Assets2,678.7
23,039.5
43,890.5
7 4,343.64 4,582.08Total
Assets68,595.
9074,681.
0493,008.
09123,955.
79147,655.
24
PROFIT & LOSS A/C OF CENTRAL BANK OF INDIA AS WHOLE
(Amt in CR)
INCOMEMar '05
Mar '06
Mar '07
Mar '08
Mar '09
Interest Earned 5,204.88
5,385.58
6,234.21
7,995.54
10,455.19
Other Income 938.87 551.24 561.83 902.35 1,069.97
Total Income 6,143.75
5,936.82
6,796.04
8,897.89
11,525.16
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 159
FINANCIAL ANALYSIS OF CENTRAL BANK OF INDIA
EXPENDITUREMar '05
Mar '06
Mar '07
Mar '08
Mar '09
Interest expended 2,829.93
3,005.51
3,759.79
5,772.47
8,226.72
Employee Cost 1,277.56
1,275.74
1,175.42
1,214.34
1,272.59
Selling and Admin Expenses
804.55 296.00 701.64 563.59 653.17
Depreciation 53.17 50.90 65.00 73.61 83.59Miscellaneous Expenses
877.04 1,051.26
596.18 723.71 717.86
Preoperative Exp Capitalised
0.00 0.00 0.00 0.00 0.00
Operating Expenses 2,284.57
1,782.22
2,133.16
2,034.89
2,184.05
Provisions & Contingencies
727.75 891.68 405.08 540.36 543.16
Total Expenses 5,842.25
5,679.41
6,298.03
8,347.72
10,953.93
Net Profit for the Year
301.50
257.42
498.01
550.16 571.24
THE S.P.B. COLLEGE OF BUSINESS ADMINISTRATION 160