New _ Final Agrani Bank.docx

8/18/2019 New _ Final Agrani Bank.docx

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Chapter-1

Orientation of the Report

Introduction of the report

Background

Significance

Scope

Objectives

Methodology

Limitations

“Financial Performance Analysis of Agrani Bank Ltd.

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1.1 !ntrod"ction of the Report#

Banking industry is one of the most promising industries of our country. The importance of the sector

revealed through its contribution in the economic groth of the country. This sector accelerates

economic groth through mobili!ing funds from surplus unit to the deficit unit. Banking industry is

moving toards rapid changes due to technological innovation and diversicified needs of its

customers."s a student of Bachelor of Business "dministration #BB"$ in every student has to

conduct a practical orientation in any organi!ation for fulfilling the re%uirements of the &' eeks

Internship (rogram. The main purpose of the program is to e)pose the students to the real orld

situation .I as assigned to do my internship in "grani Bank Ltd* Sherapara branch* Begum +okeya

Sarani. My report is on the ,-inancial (erformance evaluation of "grani Bank Limited.

1.$Backgro"nd of the Report#It is an opportunity for the students to ac%uire an in/depth knoledge about the practical orientation

and e)periences of dynamic business orld through the internship program. It is obligatory to

undertake an e)tensive study to prepare a report for the students of Business "dministration* B0BT*

ho are desirous to the successfully completion of their BB" program. "s part of the program* I am

highly proud to join ith "grani Bank Ltd as internee and selecting topic ,-inancial (erformance

evaluation of "grani Bank Ltd. I had ork there in several departments* but I had to select an area of

study in hich I can make detail research and present my understanding in the report. This report*

,-inancial (erformance evaluation of "grani Bank Limited1* has been prepared to fulfill the partialre%uirement of BB" program as a mean of Internship (rogram. 2hile preparing this report* I had a

great opportunity to have an in depth knoledge of all the banking activities of "grani Bank Ltd.

1.%&ignificance of the Report#

3ducation ill be the most effective hen theory and practice blends. Theoretical knoledge gets its

perfection ith practical application. "nd the internship is designed to bridge the gap beteen the

theoretical knoledge and real application. The prime reason of this study is to become familiar ith

the practical business orld and to attain practical knoledge about the overall Banking and

4orporate orld* hich is so much essential for each and every student to meet the e)treme groing

challenges in job market.

1.' &cope of the Report#

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The report is mainly confined to the -inancial (erformance evaluation of "grani Bank Limited. In

order to conduct study on this main issue* the folloing aspects come ithin the span of the study.

• "n overvie of "grani Bank Limited

• To kno the function of different division of "BL

• 3valuation of financial performance of "BL through trend analysis of financial ratios of "BL

1.(O)*ecti+e of the Report#

The main objective of education is to ac%uire knoledge. There are to types of objectives of the

report. One is primary objective and the other is Secondary objective.

Primary O)*ecti+e#

The primary objective of this report is to analy!e financial performance of "graniBank Ltd.

&econdary O)*ecti+es#

The secondary objectives are as follos5

• To calculate the financial ratios and identify the areas of corners.

• To calculate and interpret the li%uidity ratio* debt ratio* activity ratio profitability ratio of

"grani Bank Ltd.

• To compare financial position of "grani Bank Ltd. ith industry average.

• To dra some findings give some recommendations to improve the financial performance

of "grani Bank Ltd.

1.,ethodology#

-or smooth accurate study everyone has to follo some rules regulations* the study impute ere

collected from to sources 5

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1.,.1 Primary &o"rces #

(ractical desk ork

-ace to face conversation ith officer

6irect observation

1.,.1 &econdary so"rces # "nnual report of "BL

6emo circulars

7arious publication of bank

2ebsite

1.,.$ !nstr"ments "sed for data analysis #

The ratio analysis is used to analy!e the financial performance of "BL. 6ifferent type of computer

softare such as/ Microsoft ord* Microsoft 3)cel etc. are used for analy!ing and reporting purpose

of the study. The ratio analysis is conducted in form of trend analysis and comparative analysis.

1.,.%.1 rend Analysis #Trend analysis is the analysis of the firm8s performance over the time

using ratios. It is really important to analy!e trends in ratios as ell their absolute levels. This analysis

informs us hether a company8s financial condition improving.

1.,.%.$ Comparati+e Analysis # 4omparative analysis is the comparison of bank8s performance

ith the industry average. The study compares the profitability of the bank ith industry average.

1./ Limitations#

The study mainly covers the financial performance of "BL only. "part from this the folloinglimitations of the study can be mentioned.

ime Limitation# To complete the study* time as limited by three months. It as really very short

time to kno details about an organi!ation like "grani Bank Ltd.

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!nade0"ate ata# Lack of available information about of "grani Bank Ltd. Because of the

unillingness of the busy key persons* necessary data collection became hard. The employees are

e)tremely busy to perform their duty.

Lack of Record# 0navailability of sufficient ritten documents as re%uired making a

comprehensive study as another problems. In many cases up/to/date information as not available.

Lack of e2periences# Lack of e)periences has acted as constraints in the ay of meticulous

e)ploration on the topic. Being a member of the organi!ation9 it as not possible on my part to

e)press some of the sensitive issues.

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Chapter-$

Company profile

:istorical Background of "grani Bank Ltd.

Mission

7ision

Mottos

7alue

Strategic objectives

3thical (rinciples

Managerial :ierarchy

(roduct Services

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$.13istory of Agrani Bank Limited#

"grani Bank Limited* a leading commercial bank ith ;eneral Managers. The bank has && 4ircle

offices* '; 6ivisions in head office* D' !onal offices and ;


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$.( 4al"es#

2e value in integrity* transparency* accountability* dignity* diversity groth and professionalism to

provide high level of services to all our customers stakeholders.

'., &trategic O)*ecti+es#

• 2inning at least D.AF share of deposit A.AF share of loan and advance Bangladeshi market*

• >aining competitive advantage by loering overall cost compared to that of competitors*

• Overtaking competitors by providing %uality customer service*

• "chieving technological leadership among the peer group*

• Strengthening the bank8s brand recognition*

• 4ontributing toards the economic ellbeing of the country by focusing particularly on SM3 and

agricultural sector*

Strengthening research capability for innovative product.

$./ 5thical Principles#

C"stomer Foc"s and Fairness5 "t "BL* our prime focus is to achieve perfection is our

customer service. 4ustomers are our first priority and driving force. 2e ish to gain

customer confidence and be their trusted partner. 2e believe in fair treatment to all customer*

depositors* borroers and client ithout any discrimination.

6"ality#Guality service e)perience is a paramount to our customer and e are strongly

committed to fulfill this idea. 2e have a culture of timely compliance of regulatory

re%uirements.

3onesty and !ntegrity#2e ensure the highest level of integrity to our customer* creating

an ongoing relationship of trust and confidence. 2e treat our customers ith honesty* fairness

and respect.

Belief in O"r People#+ecogni!e that employees are our most valuable asset and our

competitive strength. 2e respect the orth and dignity of individual employees ho devote

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their careers for the progress of the bank. 2e trust in e%ual treatment to all shareholders

irrespective of their individual si!e of shareholdings.

• eam7ork#2e are a firm believer in team ork and feel that loyal and motivated terms can

produce e)traordinary results. 2e are driven by a performance culture here recognition and

reards are based on individual merit and demonstrated track record.• 8ood Corporate 8o+ernance# 3ffective corporate governance procedures are essential to

achieve and maintain public trust and confidence in any company* more so in a banking

company. "t "BL* e are committed to folloing best practices resulting in good corporate

governance.

• Corporate &ocial Responsi)ility#"s a responsible corporate citi!en* e consider it

important to act on a responsible manner toards the environment and society. Our

commitment had alays been to behave ethically.

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$.9 anagerial 3ierarchy of Agrani Bank Limited

There is a figure given belo hich e)presses the employee hierarchy of "grani Bank Ltd.

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$.: Prod"ct and &er+ices of ABL#

"graniBank Ltd. e)tends all the Banking facilities and services to customers.

The Bank has a very ide netork of activities and services both in urban and rural areas through its

;


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$.:.' 5-&er+ices #

Speedy +emittance 2estern 0nion Money Transfer

"utomated clearing

Internet banking

"TM banking

$.:.( A Operation#

6ebit card operation

Salary card operation

'.&< F"nction of Agrani Bank#

"grani bank performs all types of functions of a commercial bank* hich generally includes5

Mobili!ation of saving of the people safe keeping of all types of deposit account

(roviding banking services to common people through the branches

Introduce modern banking services in the country

6iscounting and purchasing bills

-inance for both capital machinery orking capital

6eveloping marketing campaigns

Monitoring forecasting

-inance for household durables

2ork supplication studies

-inance under small business of selfemployed clients

'.&& ifferent department of ABL#

The Bank divides its operation mainly three parts J

>eneral Banking

-oreign 3)change

Loan "dvances

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General Banking

Account OpeningSection

Local Remittancesection

Bills & ClearingSection

Cash section

Dispatch section

$.11.1 8eneral Banking#

>eneral banking is the starting point of all the banking operating. >eneral banking department aids in

taking deposit and simultaneously provides some ancillaries services. It provides those customer hocome one time in banking for enjoying ancillary services.

In some general banking activities* there is no relation beteen banker customer ho ill take

only one service form bank. Bank in confined to provide the service everyday general banking is also

knon as retail banking.

>eneral banking consists of the many sections in the branch. These are J

'.&&.' Foreign 52change#

3very sovereign country in the orld has a currency* hich is a legal tender in its territory* and this

currency cannot be used as money outside its boundaries. So henever a country buys or sells goods

and services from across its boundaries* the resident of the to countries have to e)change currencies.

Feat"re of the foreign 52change arket ;

• >lobal markets

• 'E hours markets

• @o >eographical location

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Foreign 52change rates < Prod"cts ;

• TT

• Bills of collection rate

•

O6 transfer rate• T6K

• Spot

• Tom

-d

$.11.% eposit &chemes#

• Savings 6eposit

• Short term 6eposit

• Term 6eposit

•

"grani 6eposit (ension Scheme.

$.11.'Other Banking &er+ices#

"BL ith its ide ranging branch netork and skilled personnel provides prompt and personali!ed

services like issuing J

• 6emand 6raft

• Telegraphic Transfer

• Mail Transfer

• (ay order

• Security 6eposit +eceipt

$.11.( Comp"teri=ed Banking &er+ices#

More than C


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$.11., One &top &er+ice#

"BL first among the @ationali!ed 4ommercial Banks in Bangladesh* has introduce one stop service.

There are some feature of this system are as under J

" customer can deposit ithdra money from a single counter

• The system of Token Scroll has been discontinued

• 4ustomer are getting prompt personali!ed services from a single counter

• 7erification of signature is very easy as the same is stored in the computer

$.1$ 8eneral Credit line#• The main focus of "BL credit line is financing business* trade industrial activities through

an effective delivery system.

• "BL offers credit to almost all sectors of commercial activities having productive purpose.

• The loan portfolio of the bank encompasses a ide range of credit programs covering about

'overnment.

• "t a reduced interest rate to develop frontier Industries.

• 4redit facilities are offered to individuals* businessmen* small big business houses* traders*

manufactures* corporate bodies etc.

• Loan pricing system in customer is friendly

• (rime customer enjoy prime rate in lending other services

• Guick appreciation* appraisal* decision disbursement are ensured

• 4redit facilities are e)tended as per guide/line of Bangladesh Bank and operational

procedures of the bank

The rates may change time to time depending on the level of competition in the financial

sector.

$.1% R"ral Credit Program#

" vast majority of the Bangladesh live in the rural areas and their main source of income is

agriculture and agro/business."BL has opened branches in rural areas to cater to the banking needs of

rural people. "part from accepting deposits from the rich and moderately ell/off villagers* "BL

encourage the poor people to make small saving through different mechanism. It also lends to the

poor landless so that they can make living. The average loan si!e is about '


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Shrimp culture credit program

• Irrigation agricultural e%uipment

$.1%.1 O)*ecti+e#• To increase "gricultural production improvement it8s %uality

• To gear up socio/economic activities among rural people• To create employment opportunities among rural people through economic support

• 4reating confidence among the beneficiaries on institutional credit and their access to

improved production practices.

• To build up asset by creating saving habit among the rural population

• (overty reduction.

$.1%.$ ForeignRemittance#

• "BL has a netork of more than < domestic branches in Bangladesh covering hole of the

country including the rural areas

• +emittance services are available at all branches and foreign remittances may be sent to any

branch by remitters favoring their beneficiaries

• +emittances are credited to the account of beneficiaries instantly or ithin shortest possible

time

• "BL has correspondent banking relationship ith all major banks e)change houses located

in almost all the countries. 3)patriates Bangladeshis may send their hard earned foreign

currencies through those bank and e)change house or may contact any renoned banks

nearby to send their money to their dear on in Bangladesh.

Chapter-%heoritical Aspect

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-inancial performance analysis

Balance sheet

Incomes Statement

+atio "nalysisSignificance of using ratios

Types of ratio comparisons

>roups of -inancial ratios


%.1 Financial Performance Analysis#

-inancial (erformance is a subjective measure of ho ell a firm can use assets from its primary

mode of business and generate revenues. This term is also used as a general measure of a firm?s

overall financial health over a given period of time* and can be used to compare similar firms across

the same industry or to compare industries or sectors in aggregation.

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basic inputs to ratio analysis are the firm8s income statement and balance sheet for the periods to be

e)amined. +atio analysis is predominately used by proponents offundamental analysis.

In finance* a financial ratio or accounting ratio is a ratio of to selected numerical values taken from

an enterprise8s financial statements. There are many standard ratios used to try to evaluate the overall

financial condition of a corporation or other organi!ation. -inancial ratios may be used by managers

ithin a firm* by current and potential shareholders #oners$ of a firm* and by a firm8s creditors.

Security analysts use financial ratios to compare the strengths and eaknesses in various companies.

If shares in a company are traded in a financial market* the market price of the shares is used in

certain financial ratios.

In short* ratio analysis is essentially concerned ith the calculation of relationships hich* after

proper identification and interpretation may provide information about the operations and state of

affairs of a business enterprise. The analysis is used to provide indicators of past performance in

terms of critical success factors of a business. This assistance in decision/making reduces reliance on

guessork and intuition and establishes a basis for sound judgment.

%.( &ignificance of "sing ratios#

The significance of a ratio can only truly be appreciated hen5

1. It is compared ith other ratios in the same set of financial statements.

$. It is compared ith the same ratio in previous financial statements #trend analysis$.

%. It is compared ith a standard of performance #industry average$.Such a standard may be

either the ratio hich represents the typical performance of the trade or industry* or the ratio

hich represents the target set by management as desirable for the business.

%., ypes of ratio comparisons#

Three types of ratio comparisons can be made5

1. Cross-sectional Analysis#4ross/sectional analysis involves the comparison of different

firms8 financial ratios at the same point in time. The typical business is interested in ho ell

it has performed in relation to its competitors.

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$. ime- series Analysis#Time/series analysis is applied hen a financial analyst evaluates

performance over time. 4omparison of current to past performance utili!ing ratio analysis

allos the firm to determine hether it is progressing as planned.

%. Com)ined Analysis#The most informative approach to ratio analysis is one that 4ombine

cross/sectional and time/series analyses.

%./8ro"ps of Financial Ratios#

-inancial ratios can be divided into four basic groups or categories. They are J

A. Li%uidity ratios

B. "ctivity ratios

C. 6ebt ratios and

. (rofitability ratios

Li%uidity measures the ability to maintain positive cash flo* hile satisfying immediate obligations.

"ctivity ratio measures the speed ith hich accounts are converted into sale or cash. 6ebt ratio

measures the amount of other people8s money used in generating profit. (rofitability measures the

ability to earn income and sustain groth in both short/term and long/term. " company?s degree of

profitability is usually based on the income statement* hich reports on the company?s results of

operations.

%./.1 Analy=ing Li0"idity#

Li%uidity refers to the ability of a firm to meet its short/term financial obligations hen and as they

come due. It also refers to the solvency of the firm8s overall financial position.The main concern of

li%uidity ratio is to measure the ability of the firms to meet their short/term maturing obligations.

-ailure to do this ill result in the total failure of the business* as it ould be forced into li%uidation.

The three basic measures of li%uidity are/

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C"rrent Ratio#

The 4urrent ratio e)presses the relationship beteen the firm8s currentassets and its current liabilities.

" measure of li%uidity calculated by dividing the firm8s current assets by current liabilities.

C"rrent Ratio>C"rrent assets?C"rrent lia)ilities

@et orking Capital#

" measure of li%uidity calculated by subtracting total current assets by current liabilities.4urrent

assets normally include cash* marketable securities* accounts receivable and inventories. 4urrent

liabilities consist of accounts payable* short term notes payable* short/term loans* current maturities

of long term debt* accrued income ta)es and other accrued e)penses #ages$.

@et orking Capital>otal C"rrent Assets-otal C"rrent Lia)ilities

6"ick Ratio#

Guick ratio measures assets that are %uickly converted into cash and they are compared ith current

liabilities. This ratio reali!es that some of current assets are not easily convertible to cash like/

inventories. The %uick ratio* also referred to as acid test ratio* e)amines the ability of the business to

cover its short/term obligations from its ,%uick1 assets only. The %uick ratio is calculated as follos5

6"ick Acid-test Ratio> C"rrent assets-!n+entory?C"rrent lia)ilities

%./.$ Analy=ing Acti+ity#

If a business does not use its assets effectively* investors in the business ould rather take their

money and place it somehere else. In order for the assets to be used effectively* the business needs a

high turnover. 0nless the business continues to generate high turnover* assets ill be idle as it is

impossible to buy and sell fi)ed assets continuously as turnover changes. "ctivity ratios are therefore

used to assess ho active various assets are in the business. "ctivity ratios are discussed ne)t.

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otal Asset "rno+er#

Total asset turnover is the relationship beteen sales and assets.

otal Asset "rno+er>&ales?otal Asset

!n+estment to eposit Ratio#

Investment to 6eposit +atio shos the operating efficiency of a particular bank in promoting it8s

investment product by measuring the percentage of the total deposit disburse by the bank as long and

advance or as investment. The ratio is calculated as follos J

!n+estment to eposit ratio > otal in+estment ? otal deposit

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%./.% Analy=ing e)t#

The debt position of the firm indicates the amount of other people8s money being used in attempting

to generate profits. In general* the more debt a firm uses in relation to its total assets*the greater its

financial leverage* a term used to describe the magnification of risk and return introduced through the

use of fi)ed/cost financing such as debt and preferred stock.

e)t Ratio#

This is the measure of financial strength that reflects the proportion of capital hich has been funded

by debt* including preference shares. " debt ratio greater than &.< means the company has negative

net orth* and is technically bankrupt. This ratio is calculated as follos5

e)t Ratio>otal lia)ilities?otal assets

e)t-e0"ity Ratio#

This ratio indicates the e)tent to hich debt is covered by shareholders funds. It reflects the relative

position of the e%uity holders and the lenders and indicates the company8s policy on the mi) of capital

funds. The debt to e%uity ratio is calculated as follos5

e)t-e0"ity Ratio > Long-term de)t ? &tockholderDs e0"ity

ime !nterest 5arned Ratio#

This ratio measure the e)tent to hich earnings can decline ithout causing financial losses to the

firm and creating an inability to meet the interest cost

ime !nterest 5arned Ratio>5B!?!nterest

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%./.' Analy=ing Profita)ility#

(rofitability is the ability of a business to earn profit over a period of time. "lthough the profit figure

is the starting point for any calculation of cash flo as already pointed out profitable companies can

still fail for lack of cash.

Operating Profit argin#

The operating profit margin represents hat are often called the pure profits earned on each sales

dollar. " higher operating profit margin is preferred. The operating profit margin is calculated as

follos5

Operating Profit argin>Operating Profit?&ales

@et Profit argin#

It measures the percentage of each sales dollar remaining after all costs and e)penses* including

interest* ta)es* and preferred stocks dividend have been deducted.@et (rofit Margin is calculated as

follos5

@et Profit argin>@et Profit after a2? &ales

Ret"rn on !n+estment#

Income is earned by using the assets of a business productively. The more efficient the production* the

more profitable the business. The rate of return on total assets indicates the degree of efficiency

hich management has used the assets of the enterprise during an accounting period.

Ret"rn on !n+estment>@et Profit after a2?otal Assets

Ret"rn of Asset ROA#

+eturn on asset measures the overall effectiveness of management in generating profits ith its

available assets also called the +eturn of "sset.

Ret"rn of Asset ROA > @et profit after ta2es ? total asset

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Ret"rn on 50"ity RO5#

This ratio shos the profit attributable to the amount invested by the oners of the business. It also

shos potential investors into the business hat they might hope to receive as a return. The

stockholders? e%uity includes share capital* share premium* distributable and non/distributable

reserves. The ratio is calculated as follos5

Ret"rn on 50"ity>@et Profit after a2 ? &tockholderEs e0"ity

5arnings per &hare 5P&#

The firms earning per share are generally of interest to present or prospective shareholders and

management. The 3(S represent the number of taka earned on behalf of each outstanding share of

common stock.

5P& > @et profit after ta2 ? @"m)er of share o"tstanding

arket Ratio #

+elate the firmmarket value* as measured by its current share price* to certain accounting values.

These ratios give insight into ho ell investors in the market place feel the firm are doing in term of

risk and return.

Price ? 5arnings Ratio P?5 Ratio#he price H 3arnings +atio of a stock measure of the price paidfor a share relative to income earned by the firm per share. (H3 +atio measures the amount that

investors are illing to pay for each taka of firms earning. The level of this ratio indicates the degree

of confidence investors have in the firm8s future performance. The higher the (H3 +atio the greater

the investor confidence is J

P?5 Ratio > arket price per share ? earning per share

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Chapter-'Financial Performance Analysis

4urrent ratio

@et orking 4apital

Total "ssets Turn Over

Investment to 6eposit ratio6ebt +atio

Time Interest 3arned +atio

@et (rofit Margin

+eturn on "ssets

+eturn on 3%uity

4ost to Income ratio


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'.1 Li0"idity Ratio#

Li%uidity ratiosattempt to measure a bank8s ability to pay off its short term debt obligations.

C"rrent Ratio#

The current ratio* one of the most commonly cited financial ratios* measures the firm8s ability to meet

its short term obligations. The higher the current ratio* the better the li%uidity position of the firm. It is

e)pressed as5

C"rrent Ratio>C"rrent Asset ? C"rrent Lia)ilities.

aka in illions

Gear $HH: $H1H $H11 $H1$ $H1%

C"rrent Asset ;


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Fig"re # 4urrent ratio

!nterpretation#

>enerally higher current ratio indicates a greater degree of li%uidity. The above graph shos a

fluctuating trend of "BL8s li%uidity position from '


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Fig"re # @et orking capital

!nterpretation

2orking capital is blood for every firm because ithout orking capital a firm can8t run its daily

activities perfectly. -romabove figure e can see that* a fluctuating trend in "BL8s orking capital

position from '


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'.$ Analy=ing Acti+ity Ratio #

"ctivity ratio measures ho effectively the bank using the assets employed. In other ord* it

measures the speed ith hich various accounts are converted into sales or cash inflos.

otal Asset "rn O+er #The total asset turnover indicate the efficiency ith hich the firm is able

to use all its assets to generate sales.

otal Asset "rnO+er > &ales !ncome ? otal Assets

aka in illions

Gear $HH: $H1H $H11 $H1$ $H1%O! DEE &


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!n+estment to eposit Ratio #

Investment to deposit ratio shos the operating efficiency of a bank in promoting its investment

product in terms of total deposit.

!n+estment to eposit Ratio > otal !n+estment ? otal deposit

aka in illions

Gear $HH: $H1H $H11 $H1$ $H1%otal !n+estment E


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'.% e)t ratio#

6ebt ratio measures of the degree of protection for long/ term creditors and investors.

e)t Ratio#

The 6ebt +atio measures the proportion of total assets financed by the firm8s creditors.

e)t Ratio> otal Lia)ilities ? otal Assets

aka in illions

Gear $HH: $H1H $H11 $H1$ $H1%

otal Asset '&E


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In '


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ime !nterest 5arned Ratio#

Times interest earned ratio measures the firm8s ability to make contractual interest payments9

sometimes called the interest coverage ratio.

ime !nterest 5arned Ratio >5arnings )efore !nterest < a2es ? !nterest e2pensesaka in illions

Gear $HH: $H1H $H11 $H1$ $H1%

ime !nterest 5arned

Ratio imes

&.= '.&& &.


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'.' Profita)ility Ratio#

(rofitability ratio measures of the degree of successor failure of a given enterprise or division for a

given period of time.

@et Profit argin#

The net profit margin measures the percentage of each dollar revenue remaining after all e)penses*

including ta)es* have deducted. The higher net profit margin is better for the firm. The net profit

margin is a commonly cited measure of the company8s success ith respect to earnings on revenue.

Net Profit margin= Earnings Available for commonstock holders

Sales

aka in illions

Gear $HH: $H1H $H11 $H1$ $H1%

@et Profit argin '&F C'F &=F /&.EF ''F

a)le # @et (rofit Margin&o"rce #"nnual report of "BL#'


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Ret"rn on Asset ROA#

+eturn on asset #+O"$* hich is often called the firms return on total assets* measures the overall

effectiveness of management in generating profits ith its available assets.

ROA= Earnings available for commonstockholdersTotal Asset ×100

aka in illions

Gear $HH: $H1H $H11 $H1$ $H1%

Ret"rn on Asset .DCF &.CCF .='F /E.;'F '.


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In this graph shos that "BL +eturn on "sset has loer for the year '


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Cost to income ratio#

4ost/income ratio is the ratio beteen operating e)penses and operating income. It is a measure of

ho costs are changing compares to income. It is one of the main key performance indicators of a

banks efficiency the loer the ratio the more efficient the bank.

Cost to income ratio > Operating cost? operating income

aka in illions$

Gear $HH: $H1H $H11 $H1$ $H1%Cost to income ratio D


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Chapter-(

Comparati+e Analysis of ABL 7ith

!nd"stry A+erage

4ost to Income ratio

+eturn on "sset

+eturn on 3%uity


(.1 Cost to !ncome ratio#

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Gear ABL !nd"stry A+g.

$HH: D


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Gear ABL !nd"stry A+g.

$HH:


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$H1$ /'A;.;E &.


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a*or FindingsK Recommedations<

Concl"sion

-indings

+ecommendation

4onclusion


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,.1 a*orFindings#

2hile orking at "grani Bank Ltd. Sherapara Branch* I have attained a neer kind of

e)perience. "fter the collecting analy!ing of data I have got some findings.

There is a fluctuating trend in current ratio of "BL. The current ratio of "BL as '.&' in

'


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,.$ Recommendations#

"fter analy!ing the financial performance of "BL* I ant to put some suggestion here hich I think it

folloed ould be definitely help "BL. To promote financial position and there/by its contribution in

the hole economy/

The "BL should maintain its 4" against 4L to meet up short term obligation.

The "BL should efficiently use its assets to convert it into sales* so that the Total "sset

Turn Over has increased.

"BL should efficient in converting their deposit into investment.

The cost to income ratio shos the efficiency of a bank in minimi!ing costs hile

increasing profits. >radually* "BL8s cost has increased. So bank should decrease the

cost.

"BL8s +O3 should increase otherise the oners cannot be benefited this return. It is

loer than industry average in '


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3conomy of Bangladesh is in group of orld most under developed economies. One of the reason

may be it8s under developed banking system. >overnment as ell as different International

organi!ations have also identified that under developed banking system causes some obstacles to the

process of economic development. So* they have highly recommended for reforming financial sector.

Since &;;overnment has taken a lot of financial sector reform measurements for

making financial sector as ell as banking sector more transparent* and formulation

implementation of these reform activities. "t last it can be said that "BL should improve its overall

banking system to influence customers investors. 4ustomer relation should be increased to give

appropriate service to them and treat them as an asset of the company.

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Bi)liography#

,(rincipal of Managerial -inance1 by Larence >itman #&' th 3dition$

,+esearch Methodology 1 by 4. +. Nothari #'nd +evised 3dition$

,Intermediate "ccounting1 by 6onald 3. Nieso* erry . 2eygandt* Terry d. 2arfield #&& th

3dition$

Bangladesh Bank '


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