Welcome To Our
Presentation
Group Members Details
Exam Roll
Reg. No.
Name
1703001
07642
Ehsanul Hasib Pranto
1703002
07643
Sk. Khalid Uz - Zaman
1703003
07644
Golam Rabbani Rasha
1703010
07651
Md. Sakil Ahmed
1703013
07654
Md. Tazwarul Islam Tasnim
1703014
07655
Nafis Fuad
1703016
07657
Mehedi Hasan Anik
Ehsanul Hasib Pranto
ID No.1703001
Analysis of the performance of Eastern Bank Ltd.
Sk. Khalid Uz – Zaman
Id: 1703002
Reg: 07643
Current Ratio = Current Assets / Current
Liabilities
Series 1
1.6
1.34
1.4
1.2
1.23
1.07
1.22
1.14
1
0.8
0.6
0.4
0.2
0
Category 1
Category 2
Category 3
Series 1
Category 4
Category 5
Debt to Equity Capital Ratio= Total
debt/Total equity
Series 1
0.08
0.07
0.07
0.06
0.06
0.051
0.05
Category 1
Category 2
0.06
0.05
0.04
0.03
0.02
0.01
0
Category 3
Series 1
Category 4
Category 5
Total debt to Total Asset ratio= Total
Debt/Total Assets
Series 1
0.0062
0.006
0.006
0.006
0.006
Axis Title
0.0058
0.0056
0.0054
0.0052
0.005
0.005
0.005
0.0048
0.0046
0.0044
Category 1
Category 2
Category 3
Axis Title
Series 1
Category 4
Category 5
Net Profit Margin= Net Income After Tax/ Total
Operating Revenue
Series 1
25.00%
21.09%
22.44%
23.44%
23.13%
19.39%
20.00%
15.00%
10.00%
5.00%
0.00%
Category 1
Category 2
Category 3
Series 1
Category 4
Category 5
Net Operating Margin= (Operating
Revenue-Operating Expense)/Total Asset
Series 1
Series 1
3.36%
3.04%
2.75%
Category 1
Category 2
2.69%
Category 3
Category 4
2.53%
Category 5
Return on Equity= Net income After Tax/
Total Equity Capital
Series 1
16
14
12
10
8
6
4
2
0
13.42
12.91
10.49
10.84
Category 1
Category 2
11.14
Category 3
Series 1
Category 4
Category 5
Return on Asset=Net Income After Tax/Total
Asset
Series 1
1.40%
1.20%
1.00%
1.22%
1.17%
1.26%
1.09%
0.95%
0.80%
0.60%
0.40%
0.20%
0.00%
Category 1
Category 2
Category 3
Series 1
Category 4
Category 5
Return on Deposits (ROD)= Net
Income/Total Deposit
Series 1
3.94%
3.43%
3.76%
3.43%
2.77%
CATEGORY 1
CATEGORY 2
CATEGORY 3
Series 1
CATEGORY 4
CATEGORY 5
Tax Management Ratio= Net Income After
Tax/ Net Income Before Tax
Series 1
0.67
0.65
0.6
0.59
CATEGORY 3
CATEGORY 4
0.53
CATEGORY 1
CATEGORY 2
Series 1
CATEGORY 5
Expense Control Efficiency= Net Income before
Tax and Gain/Total Operating Revenue
Series 1
0.69
0.69
0.66
0.64
0.6
CATEGORY 1
CATEGORY 2
CATEGORY 3
Series 1
CATEGORY 4
CATEGORY 5
Degree of Asset Utilization= Total Operating
Revenue/Total Asset
Series 1
0.04
0.035
0.034
0.03
0.028
0.03
0.027
0.025
0.025
0.02
0.015
0.01
0.005
0
Category 1
Category 2
Category 3
Series 1
Category 4
Category 5
Operating Efficiency Ratio= Total Operating
Revenue/Total Operating Expense
Series 1
2.37
2.27
2.21
2.19
2.11
CATEGORY 1
CATEGORY 2
CATEGORY 3
Series 1
CATEGORY 4
CATEGORY 5
Capital Adequacy Ratio= capital base
(Tier 1+Tier11)/Risk Weighted Assets
Series 1
15.10%
14.23%
14.09%
13.22%
12.16%
CATEGORY 1
CATEGORY 2
CATEGORY 3
Series 1
CATEGORY 4
CATEGORY 5
Investment Deposit Ratio = Total
Investment/ Total deposit
Series 1
6.49%
6.37%
5.03%
4.58%
CATEGORY 1
CATEGORY 2
CATEGORY 3
Series 1
CATEGORY 4
4.87%
CATEGORY 5
Equity Multiplier= Total Assets/Total Equity
Capital
Series 1
11.723
12.299
10.266
8.569
CATEGORY 1
9.249
CATEGORY 2
CATEGORY 3
Series 1
CATEGORY 4
CATEGORY 5
P/E Ratio=Market Value Per Share/Earnings
Per Share
Series 1
4.18
3.45
CATEGORY 1
3.63
3.78
3.26
CATEGORY 2
CATEGORY 3
Series 1
CATEGORY 4
CATEGORY 5
• Recommendations:
In terms of current ratio, it is seen that in 2014, the ratio was 1.07 and in 2015, it
became 1.14. so, it was increasing and till 2017 it continues. But in 2018 accidently
the ratio had decreased. Now the ratio is less than last year. So, it’s in a good
position. The bank should keep this as less as they can.
According to the Dept to Equity capital ratio, the ratio in 2014 was 0.051 and it rose
up to 2017. It’s good that the ratio is of debt is decreasing than equity in 2018.
Total asset ratio said that the result is almost same in these 5 years. In some cases, it
rose up but in 2018 it had decreased again. It is also good for the bank as debt is
decreasing than asset.
The profit was increasing at a good rate till 2017. But in 2017 the ratio had
decreased which is not good for the bank. But in 2018 the ratio had rose again. It had
rose more than ever.
In the net operating margin, we can see, net revenue is decreasing gradually which
can make drastically result for the bank.
In 2014 the return on equity was 10.49%. it was increasing up to 2016. It started
decreasing in 2017 but again rose in 2018. It is good for raising income.
•
•
•
•
•
•
•
•
•
In terms of return on asset we can see it was good in 2014 Though it rose in 2016, it became
less in 2018 which is not good at all.
Return on deposit was 3.43% in 2014. In 2015 it decreased to 2.77%. but in 2018, it rose up
to 3.76%. if income increased the process is definitely good.
In tax management ratio we can see the tax in increasing though it decreased in 2016 and
2017. In 2018, it is increased. If income raised then tax is raised. So, raise of tax is good for
the bank. They should keep this on.
Expenses should be in limit. In 2014, the expense was more and the revenue was less for it.
But in 2018 the ratio was increased. So, the expenses are controlled than previous.
Asset should be properly utilized. In 2014, the operating revenue to asset ratio was 0.034 and
in 2018 it became 0.025. so, it is a good sign for the bank.
Operating revenue ratio to operating expense is decreasing. In 2014 it was 2.37 times and in
2018 it was 2.19 times. Really a good sign for the bank.
The exact ratio of capital adequacy should be 10%. We can see it was 13.22% in 2014. But it
was 12.16% in 2018. So, Eastern bank had maintained the minimum requirement of it.
In 2014, the ratio was 6.49% and in 2018 it was 4.87%. So, the ratio had decreased. It would
be a threat if the ratio is not controlled in future.
The asset to equity capital ratio is unstable. It is not good for the bank. They should control
the asset to equity and capital.
EXIM BANK LTD.
FINANCIAL ANALYSIS OF RATIOS FROM LAST 5 YEARS ANNUAL REPORT
By
Golam Rabbani Rasha
ID: 1703003
Reg: 07644
RATIOS OF EXIM BANK LTD. FOR THE PAST 5 YEARS
Ratios
2018
2017
2016
2015
2014
0.180881164
0.217190433
0.213249978
0.266775702
0.243313032
12.1836753
11.07358214
9.95198489
9.46142772
0.905881519
total debt to total asset ratio
0.924148617
0.91717454
0.90869235
0.904410753
0.090058471
Net profit Margin
0.187610971
0.596550417
0.268782406
0.202104023
0.242773051
Net Operating Margin
0.003578113
0.000960184
0.020310872
0.02398823
0.025832408
Return on Equity
0.081455443
0.115665018
0.110590328
0.086676302
0.107374879
Return on Asset
0.006178508
0.009580008
0.010097743
0.008285322
0.010674704
Return on Deposits (ROD)
0.007620719
0.112452584
0.011808412
0.009742716
0.012386408
Tax Management Ratio
0.548711741
0.614780554
0.601099329
0.583488547
0.562962495
Expense Control Efficiency
0.341911713
0.97034692
0.447151398
0.346371876
0.431241962
Degree of asset Utilization
0.032932551
0.016059009
0.037568467
0.040995337
0.04396989
Operating efficiency ratio
1.121893422
1.063593262
2.176923721
2.410482786
2.424255499
0.10901707
0.121126944
0.118278614
0.121536084
0.117965673
1.095881169
9.714832929
0.962489645
0.953079229
0.969737048
13.1836753
12.07358214
10.95198489
10.46142772
10.05881519
1.623089824
2.261600033
2.078148938
1.552655798
1.75671872
Current ratio
Debt to equity capital ratio
Capital Adequecy Ratio
Investment Deposit Ratio
Equity Multiplier
EPS
Liquidity Ratios: Liquidity ratios are an important class of financial metrics used to determine a debtor's ability to pay off
current debt obligations without raising external capital.
- Current Ratios: The current ratio measures whether or not a firm has enough resources to pay its debts over the next 12
months.
Liquidity
0.3
0.266775702
0.25
0.2
0.243313032
0.217190433
0.213249978
0.180881164
0.15
0.1
0.05
0
Current ratio
2018
0.180881164
2017
0.217190433
Current ratio
2016
0.213249978
Linear (Current ratio)
2015
0.266775702
2014
0.243313032
A LEVERAGE RATIO IS ANY ONE OF SEVERAL FINANCIAL MEASUREMENTS THAT LOOK AT HOW MUCH CAPITAL COMES IN THE
FORM OF DEBT (LOANS) OR ASSESSES THE ABILITY OF A COMPANY TO MEET ITS FINANCIAL OBLIGATIONS.
-DEBT TO EQUITY RATIO
-TOTAL DEBT TO TOTAL ASSET RATIO
Levarage position
14
12
12.1836753
11.07358214
10
9.95198489
9.46142772
8
6
4
2
0.924148617
0.91717454
0.90869235
Debt to equity capital ratio
2018
12.1836753
2017
11.07358214
2016
9.95198489
2015
9.46142772
0.905881519
0.090058471
2014
0.905881519
Debt to equity capital ratio2
0.924148617
0.91717454
0.90869235
0.904410753
0.090058471
0
Debt to equity capital ratio
Debt to equity capital ratio2
0.904410753
2 per. Mov. Avg. (Debt to equity capital ratio)
PROFITABILITY RATIOS ARE A CLASS OF FINANCIAL METRICS THAT ARE USED TO ASSESS A BUSINESS'S ABILITY TO GENERATE EARNINGS
RELATIVE TO ITS REVENUE, OPERATING COSTS, BALANCE SHEET ASSETS, AND SHAREHOLDERS' EQUITY OVER TIME, USING DATA FROM A
SPECIFIC POINT IN TIME.
-NET PROFIT MARGIN
-NET OPERATING MARGIN
-ROE
-ROA
-ROD
Profitability
0.7
0.6
0.596550417
0.5
0.4
0.3
0.268782406
0.2
0.187610971
0.1
Net profit Margin
0.081455443
0.007620719
0.006178508
2018
0.187610971
Net Operating Margin
Return on Equity(ROE)
0.112452584
0.115665018
0.202104023
0.242773051
0.009580008
2017
0.596550417
0.110590328
0.011808412
0.010097743
2016
0.268782406
0.003578113
0.000960184
0.020310872
0.02398823
0.025832408
0.081455443
0.115665018
0.110590328
0.086676302
0.107374879
Return on Asset(ROA)
0.006178508
0.009580008
0.010097743
0.008285322
0.010674704
Return on Deposits (ROD)
0.007620719
0.112452584
0.011808412
0.009742716
0.012386408
0
Net profit Margin
Net Operating Margin
Return on Equity(ROE)
Return on Asset(ROA)
0.086676302
0.009742716
0.008285322
2015
0.202104023
0.107374879
0.012386408
0.010674704
2014
0.242773051
Return on Deposits (ROD)
Linear (Net profit Margin)
AN EFFICIENCY RATIO IS A CALCULATION THAT ILLUSTRATES A BANK’S PROFITABILITY.
-TAX MANAGEMENT RATIO
-EXPENSE CONTROL RATIO
-DEGREE OF ASSET UTILIZATION -OPERATING EFFICIENCY RATIO
Efficiency
3
2.5
2.410482786
2.424255499
0.601099329
0.447151398
0.583488547
0.562962495
0.431241962
0.037568467
2016
0.040995337
2015
2.176923721
2
1.5
1
0.5
0
1.121893422
1.063593262
0.97034692
0.548711741
0.341911713
0.614780554
0.032932551
2018
0.016059009
2017
0.346371876
0.04396989
2014
Tax Management Ratio
0.548711741
0.614780554
0.601099329
0.583488547
0.562962495
Expense Control Efficiency
0.341911713
0.97034692
0.447151398
0.346371876
0.431241962
Degree of asset Utilization
0.032932551
0.016059009
0.037568467
0.040995337
0.04396989
Operating efficiency ratio
1.121893422
1.063593262
2.176923721
2.410482786
2.424255499
Tax Management Ratio
Expense Control Efficiency
Degree of asset Utilization
Operating efficiency ratio
THE ASSET TURNOVER RATIO MEASURES THE VALUE OF A COMPANY'S SALES OR REVENUES RELATIVE TO THE VALUE OF ITS ASSETS. THE ASSET
TURNOVER RATIO CAN BE USED AS AN INDICATOR OF THE EFFICIENCY WITH WHICH A COMPANY IS USING ITS ASSETS TO GENERATE REVENUE.
-INVESTMENT DEPOSIT RATIO
-EQUITY MULTIPLIER
Assets Quantity indicator
14
13.1836753
12.07358214
12
10.95198489
10
9.714832929
10.46142772
10.05881519
8
6
4
2
1.095881169
0
0.962489645
0.953079229
0.969737048
Investment Deposit Ratio
2018
1.095881169
2017
9.714832929
2016
0.962489645
2015
0.953079229
2014
0.969737048
Equity Multiplier
13.1836753
12.07358214
10.95198489
10.46142772
10.05881519
Investment Deposit Ratio
Equity Multiplier
THE CAPITAL ADEQUACY RATIO (CAR) IS A MEASUREMENT OF A BANK'S AVAILABLE CAPITAL EXPRESSED AS A
PERCENTAGE OF A BANK'S RISK-WEIGHTED CREDIT EXPOSURES.
Adequacy Ratio
0.124
0.122
0.121536084
0.121126944
0.12
0.118278614
0.118
0.117965673
0.116
0.114
0.112
0.11
0.108
0.10901707
0.106
0.104
0.102
Capital Adequacy Ratio
2018
0.10901707
2017
0.121126944
Capital Adequacy Ratio
2016
0.118278614
Linear (Capital Adequacy Ratio)
2015
0.121536084
2014
0.117965673
THE MARKET VALUE RATIOS ARE IMPORTANT FOR INVESTORS, MANAGEMENT, ETC AS THESE RATIOS ARE USED TO
DECIDE WHETHER THE VALUATION OF THE SHARES ARE OVERVALUED, UNDERVALUED OR AT PAR WITH THE MARKET.
P/E RATIO THIS YEAR 5.94
Market Ratio
2.5
2.261600033
2.078148938
2
1.75671872
1.5
1.623089824
1.552655798
1
0.5
0
EPS
2018
1.623089824
2017
2.261600033
2016
2.078148938
EPS
Linear (EPS)
2015
1.552655798
2014
1.75671872
RECOMMENDATIONS
•
•
•
•
•
•
•
•
•
•
•
•
•
Branch should introduce a smoother function to deal with the customers.
Adding a fully computerized general banking system to satisfy the customers by providing faster service.
Establishing a networking system inside the branches to transfer data within a short period.
Cancel the introducer system to collect more deposit through the new account which will result satisfying the
customer.
Upgrading the general banking conveniences rather than the conventional banking system for easier understanding.
Setting up sophisticated technology and formulating appropriate programs to develop the captioned activities.
The bank ought to deliberate the customer criticize when they rise any problematic.
The Bank must deliver rapid client service to escape haphazardness.
The Bank should increase their staff according to customer demand.
As soon as possible the bank should launch more branches in Dhaka city as well as in other cities of the country.
There has no facility of working out for intern students.
They can introduce workspace or seminar for short term period training for an intern that will enrich the recital
and knowledge of the intern students.
Every branch should have their capability about the power system and internet connectivity for diminishing the
service down time.






In the report I analyzed the performance of
Prime Bank Bangladesh Ltd. interms of–
Liquidity Ratio
Leverage Position
Profitability
Activity(Efficiency)
Adequacy Ratio
















Debt to Equity Capital Ratio= Total debt/Total equity
Total debt to Total Asset ratio= Total Debt/Total Assets
Net Profit Margin= Net Income After Tax/ Total Operating Revenue
Net Operating Margin= (Operating Revenue-Operating Expense)/Total Asset
Return on Equity= Net income After Tax/ Total Equity Capital
Current Ratio = Current Assets / Current Liabilities
Return on Asset=Net Income After Tax/Total Asset
Return on Deposits (ROD)= Net Income/Total Deposit
Tax Management Ratio= Net Income After Tax/ Net Income Before Tax
Expense Control Efficiency= Net Income before Tax and Gain/Total Operating
Revenue
Degree of Asset Utilization= Total Operating Revenue/Total Asset
Operating Efficiency Ratio= Total Operating Revenue/Total Operating Expense
Capital Adequacy Ratio= capital base (Tier 1+Tier11)/Risk Weighted Assets
Formula Investment Deposit Ratio = Total Investment/ Total deposit
Equity Multiplier= Total Assets/Total Equity Capital
P/E Ratio=Market Value Per Share/Earnings Per Share

Liquidity Ratio:

Current Ratio:
0.94
0.93
0.92
0.91
0.9
0.89
Current ratio of prime bank
0.88
0.87
2014
2015
2016
2017
2018
Current ratio of prime bank




Findings about current ratio:
According to the result of current ratio of Prime bank limited was 0.93 in the year
2014,0.89 in 2015,0.89 in 2016.0.91 in 2017 and 0.89 in the year 2018.
It means that the bank had the following current asset in against of liability.
The company has the more current liabilities than the current asset.

Debt to Equity capital Ratio:

Formula:Debt to Equity capital Ratio:Total debt/Total equity.
Debt to equity capital ratio
3
2.9
2.8
2.7
2.6
Debt to equity capital ratio
2.5
2.4
2.3
2.2
2014



2015
2016
2017
2018
Findings about debt to equity capital ratio:
There is an unstable trend in the debt to equity capital ratio of Prime bank
limited.The debt to equity capital ratio of prime bank limited has decreased
2.93 to 2.46 over 5 years period time.
It means that their liability is increasing than their equity from 2014 to 2018.


Total debt to Total asset Ratio:
Formula: Total debt to total asset Ratio=Total debt /Total
assets.
Total debt to total asset ratio
0.3
0.25
0.2
0.15
Total debt to total asset ratio
0.1
0.05
0
2014



2015
2016
2017
2018
Findings about total debt to total assets ratio:
Prime bank limited has been able to maintain an average debt ratio of 0.21 from
2014 to 2018.Their total asset and their liabilities are decreasing mostly in same
range.
This is good from a risk perspective ,because higher leverage means higher
earnings.



Profitability ratio:
Net profit Margin:
Formula : Net profit Margin=Net income after Tax/Total
operating Revenue.
Net profit margin
0.25
0.2
0.15
Net profit margin
0.1
0.05
0
2014



2015
2016
2017
2018
Findings about Net Profit Margin:
The Net profit margin ratio of prime bank ltd is showing that their margin is
going at same margin.
It remains about same because their total operating revenue is higher than the
net profit after tax.


Net operating margin:
Formula:Net operating margin=(Operating Revenue –
Operating Expense)/Total asset.
Net operating margin
0.0245
0.024
0.0235
0.023
0.0225
0.022
Net operating margin
0.0215
0.021
0.0205
0.02
0.0195
2014



2015
2016
2017
2018
Findings about Net operating Margin:
The year 2014 to 2018,the performance of prime bank limited has not change much
over the 5 year.It is not bad sign for the bank.
Their total operating revenue is more than their total operating expense.


Return on equity (ROE):
Formula:Return on equity= Net income after tax/Total
Equity capital.
Return on equity
0.12
0.1
0.08
0.06
Return on equity
0.04
0.02
0
2014



2015
2016
2017
2018
Findings about Return on Equity:
ROE is very popular ratio toward the shareholders of any bank. The higher the
percentage is better for the bank as well as for shareholders
But the ROE of prime bank shows that the shareholders are receiving decreasing
rate of returns from 2016 to 2017.But after one year it has increased to 0.083.


Return on Asset (ROA):
Formula:Return on asset=Net income after tax/Total
Asset.
Return on asset
0.01
0.009
0.008
0.007
0.006
0.005
Return on asset
0.004
0.003
0.002
0.001
0
2014



2015
2016
2017
2018
Findings about Return on asset:
ROA is the most used profitability ratio.Although PBL was a part of banking
industry and its most of the assets come from the debt its ROA is increasing and
decreasing
As its return on asset is increasing and decreasing so,its the weak point.

Return on Deposits(ROD):

Formula:ROD = Net income /Total Deposit.
Return on Deposit
0.04
0.035
0.03
0.025
0.02
Return on Deposit
0.015
0.01
0.005
0
2014


2015
2016
2017
2018
Findings about return on deposit:
The ratio shows the amount of net income returned as a percentage of total
deposits .Return on deposits measures a bank’s profitability by receiving how
much profit a bank generates with the money savers have kept in the bank.



Efficiency ratio:
Tax Management Ratio:
Formula:Tax Management Ratio= Net income after tax/Net
income before Tax.
Tax managenent ratio.
1
0.9
0.8
0.7
0.6
0.5
Tax managenent ratio.
0.4
0.3
0.2
0.1
0
2014


2015
2016
2017
2018
Findings about tax managenent ratio:
We can observe that from the year 2014 to 2018 ,tax management ratio of prime
bank limited has been increased and decreased.This trend is seen because of
fluctuation in net income after taxes and also in net income before security gains
and losses.

Expense control efficiency:
Expense control efficiency
0.35
0.3
0.25
0.2
Expense control efficiency
0.15
0.1
0.05
0
2014


2015
2016
2017
2018
Findings about Expense Control efficiency:
We have seen that in 2004 it was 0.27,in 2015 it was 0.22,in 2016 it was 0.19 and
in 2018 it was 0.30.so,we can say that in 2014 it was higher rate but day by day it
was decreasing and in 2017 it decreased mostly but in the next year it was also
increased .This implies that prime bank can not efficiently control its expense.


Degree of asset utilization:
Formula:Degree of
Revenue/Total asset.
Asset
utilization=Total
operating
Degree of asset utilization
0.048
0.047
0.046
0.045
Degree of asset utilization
0.044
0.043
0.042
0.041
2014


2015
2016
2017
2018
Findings about Degree of asset utilization:
There has not happen much change .As we have seen that in 2014 it was 0.046
and the next year it was 0.047 ,after that it was little decreased and it was 0.044
and next 2 years it remains same.That tells that the total operating revenue is
less than total asset.


Operating efficiency ratio:
Formula:Operating
efficiency
ratio:Total
revenue/Total operating expense.
operating
Operating efficiency ratio.
2.4
2.3
2.2
2.1
Operating efficiency ratio.
2
1.9
1.8
1.7
2014


2015
2016
2017
2018
Findings about operating efficiency ratio:
we have seen that operating efficiency ratio was increasing year by year.In 2014
it was only 1.93 and after 5 year it had increased significantly and it was 2.28
which was much more than the 1.93.



Adequacy ratio:
Capital adequacy ratio:
Capital Adequacy Ratio= capital base (Tier 1+Tier11)/Risk
Weighted Assets.
Capital adequicy ratio
0.18
0.16
0.14
0.12
0.1
Capital adequicy ratio
0.08
0.06
0.04
0.02
0
2014


2015
2016
2017
2018
Findings about capital adequicy ratio:
The ratio basically determines a banks capital to its risk.There,in Prime bank
limited it had increased from 2014 to 2018.In 2014, the ratio was 0.125% and at the
last year in 2018 ,it was 0.17%.Prime bank has maintained the minimum
requirement .

Asset quality indicator:
Investment deposit ratio:

Formula:Total investment/Total deposit:

Investment deposit ratio
0.4
0.35
0.3
0.25
0.2
Investment deposit ratio
0.15
0.1
0.05
0
2014


2015
2016
2017
2018
Findings about investment deposit ratio:
Investment deposit ratio is very important thing.What we seen from the above
analysis is that in 2014 ,it was a higher rate and it was 0.35 but as year was passing
it was decreasing also.And at the end of the 2018 it was only 0.13.


Equity multiplier:
Formula:Equity multiplier
stockholder's equity
=
Total
assets
/
Total
Equity multiplier
12
11.5
11
10.5
Equity multiplier
10
9.5
9
8.5
2014


2015
2016
2017
2018
Findings about equity multiplier:
After analyzing the 5 year’s ,we have seen that in 2014 it was 10.47 but after it
decreased and in 2016 it was also increased and year by year it was also
increasing.

Price/Earning Ratio:

Formula:Market value per share/EPS
Price/Earning ratio
35
30
25
20
Price/Earning ratio
15
10
5
0
2014


2015
2016
2017
2018
Findings about P/E ratio:
P/E ratio is very important and essential thing for the banking industry.After
analyzing the 5 years P/E ratio,we can conclude after saying that all the P/E
ratio has not change much but in 2017 it increased a higher rate and all the year
remain same.






Recommendation:
Through this study I gained some practical knowledge .I
want to put some suggestion here which I think if followed
would definitely help prime bank ltd.to improve their
performance and there by its whole economy.
Suggestions are:
Current ratio is decreasing so,PBL shouldn’t keep
its decreasing rate of current ratio.
Net profit ratio is decreasing.It is very important to
increase the net profit.By investing the capital more
profitable sector,reducing non expenses and payoff
the liabilities properly bank can increase the net
profit ratio.
Net operating margin ratio is also decreasing .So,it should be
increased by reducing the operating expenses,enhancing the
operating income and total asset.




Return on equity is low.So,the bank should concern on more
net profit after tax which should increase and total equity
capital should reduce.
Capital adequacy ratio is risk weighted asset ratio of atleast
10 percent .This is more than the requirment.So,it
performance is strong over .The bank should keep that in
future.
Return on asset is very low. That implies that the bank is
more on debt compare to its income.So, the bank should
increase the fixed assets more to pay off its liabilities.
Loan to deposit fall is attribute to a greater growth in deposit
than loan which significantly improving the banks liquidity
position.So the bank should cautions in giving loans and
assesing credit worthiness because of then on going fund
crisis.Upward trends of the loans to total asset ratio to
indicate the downward trend for liquidity.So,the bank should
decrease the loan amount and increase the total asset for
improving liquidity position.


To monitor integrity of the financial statements of the
Bank (and any discussion or analysis thereof including
annual and interim reports), and any formal
announcements relating to the Bank’s actual and
forecast financial performance, reviewing significant
financial reporting judgments contained in them.
The top management must ensure the IT in all
branches.
Ratio analysis of
Islami Bank Bangladesh Limited
Year (2014-2018)
Md. Tazwarul Islam Tasnim
ID No:1703013
Reg. No: 07654
Summery of Financial Ratios
Liquidity Ratio:
 Current Ratio





Liquidity Ratio
Leverage Position
Profitability
Activity(Efficiency)
Adequacy Ratio
Leverage Position:
 Debt to Equity Capital Ratio
 Debt to Total Assets Ratio
Profitability:
 Net Profit Margin
 Net Operating Margin
 Return on Equity(ROE)
 Return on Asset(ROA)
 Return on Deposit (ROD)
Efficiency:
 Tax management ratio
 Expense Control Efficiency
 Degree of Asset Utilization
 Operating Efficiency Ratio
Adequacy Ratio:
 Capital Adequacy Ratio
Assets-Quality Indicators:
 Investment Deposit Ratio
 Equity Multiplier
Market Value:
 Price/Earnings (P/E) Ratio
Liquidity Ratio
Current Ratio:
 A liquidity ratio that measures a company's ability to pay short-term and long-term obligations.
 To calculate the ratio, analysts compare current assets to current liabilities.
 Formula: Current Ratio = Current Assets / Current Liabilities
Current Ratio
30
25
25.79
22.59
20
21.04
19.59
15
12.89
10
5
0
2014
2015
2016
2017
2018
Leverage Position
a) Debt to Equity Capital Ratio:
 Indicating that the relative proportion of shareholders' equity and debt used to finance a company's assets.
 Closely related to leveraging, the ratio is also known as risk, gearing or leverage.
 Formula: Debt to Equity Capital Ratio= Total debt/Total equity
18
16
14
12
10
8
6
12.98
14.35
15.34
16.76
16.99
2017
2018
4
2
0
2014
2015
2016
Debt to Equity Capital Ratio
Leverage Position
b) Total debt to Total Asset ratio:
 It can be interpreted as the proportion of a company’s assets that are financed by debt.
 Formula: Total debt to Total Asset ratio= Total Debt/Total Assets
0.95
0.945
0.94
0.935
0.93
0.9437
0.9444
2017
2018
0.9388
0.9348
0.925
0.9285
0.92
2014
2015
2016
Total Debt to Total Asset Ratio
Profitability Ratios
a) Net Profit Margin:
 Represents how much profit generates.
 How much of each dollar/taka collected by a bank as revenue translates into profit.
 Formula: Net Profit Margin= Net Income After Tax/ Total Operating Revenue
18.00%
16.00%
14.00%
12.00%
10.00%
8.00%
15.70%
14.49%
6.00%
13.98%
13.68%
2016
2017
11.23%
4.00%
2.00%
0.00%
2014
2015
Net Profit Margin
Linear (Net Profit Margin)
2018
Profitability Ratios
b) Net Operating Margin:
 The net profit margin is equal to how much net income or profit is generated as a percentage of revenue.
 Formula: Net Operating Margin= (Operating Revenue-Operating Expense)/Total Asset
2.50%
2.00%
1.50%
2.36%
1.00%
2.08%
2.00%
1.79%
1.91%
0.50%
0.00%
2014
2015
Net Operating Margin
2016
Linear (Net Operating Margin)
2017
2018
Profitability Ratios
c) Return on Equity (ROE):




Two-part ratio in its derivation because it brings together the income statement and balance sheet,
where net income or profit is compared to the shareholders’ equity.
The number represents the total return on equity capital and shows the firm’s ability to turn assets into profits.
Formula: Return on Equity= Net income After Tax/ Total Equity Capital
Return On Equity
Linear (Return On Equity)
12.00%
10.00%
8.00%
6.00%
4.00%
11.38%
9.17%
8.54%
9.71%
6.66%
2.00%
0.00%
2014
2015
2016
2017
2018
Profitability Ratios
d) Return on Asset (ROA):
 Return on assets is a profitability ratio that provides how much profit a bank is able to generate from its assets.
 Measures how efficient a bank's management is in generating earnings from their economic resources or
assets on their balance sheet.
 Formula: Return on Asset=Net Income After Tax/Total Asset
0.70%
0.60%
0.50%
0.40%
0.30%
0.63%
0.61%
0.56%
0.55%
2016
2017
0.43%
0.20%
0.10%
0.00%
2014
2015
Return on Asset
Linear (Return on Asset)
2018
Profitability Ratios
e) Return on Deposits (ROD):
 Return on Deposit measures the profits earned on the usage of the money provided by the depositors.
 Formula: Return on Deposits (ROD)= Net Income/Total Deposit
0.90%
0.80%
0.70%
0.60%
0.50%
0.40%
0.77%
0.71%
0.66%
0.65%
2016
2017
0.30%
0.51%
0.20%
0.10%
0.00%
2014
2015
2018
Efficiency Ratios
a) Tax Management Ratio:
 The tax management efficiency ratio of a fund measures what amount of a fund's earnings are lost to taxation.
 Formula: Tax Management Ratio= Net Income After Tax/ Net Income Before Tax
0.5
0.45
0.4
0.35
0.3
0.25
0.2
0.45
0.43
0.39
0.38
0.35
0.15
0.1
0.05
0
2014
2015
2016
Tax Management Ratio
2017
2018
Efficiency Ratios
b) Expense Control Efficiency:




This ratio will tell us how efficiently the company is managing its expense.
It’s very important to manage expense in order to survive in this competitive market.
This ratio can be a major reason for increase and decrease in net profit.
Formula: Expense Control Efficiency= Net Income before Tax and Gain/Total Operating Revenue
0.39
0.38
0.37
0.36
0.35
0.34
0.38
0.33
0.32
0.31
0.35
0.35
2017
2018
0.33
0.32
0.3
0.29
2014
2015
2016
Expense Control Efficiency
Efficiency Ratios
c) Degree of Asset Utilization:
 Used to determine how well a bank is using its available assets to generate a profit.
 The higher the utilization ratio of any given asset, the more profit it makes a bank.
 Formula: Degree of Asset Utilization= Total Operating Revenue/Total Asset
0.0425
0.042
0.0415
0.041
0.0405
0.04
0.042
0.0395
0.039
0.04
0.04
0.04
2016
2017
2018
0.0385
0.039
0.038
0.0375
2014
2015
Degree of Asset Utilization
Efficiency Ratios
d) Operating Efficiency Ratio:
 Shows how efficient a bank's management is at keeping costs low while generating revenue.
 Formula: Operating Efficiency Ratio= Total Operating Revenue/Total Operating Expense
2.5
2
1.5
2.27
2.08
1
2.07
1.81
1.91
0.5
0
2014
2015
2016
2017
2018
Adequacy Ratios
a) Capital Adequacy Ratio:
 known as capital-to-risk weighted assets ratio (CRAR)
 Used to protect depositors and promote the stability and efficiency of financial systems around the world.
 Formula: Capital Adequacy Ratio= capital base (Tier 1+Tier11)/Risk Weighted Assets
13.00%
12.50%
12.00%
11.50%
12.83%
11.00%
11.97%
11.66%
10.50%
11.30%
10.82%
10.00%
9.50%
2014
2015
2016
Capital Adequacy Ratio
2017
2018
Asset Quality Indicator
a) Investment Deposit Ratio:
Investment deposit ratio basically give information that where bank using there deposit may be development,
economy and wealth and many other sector where bank can put their money for investment so that bank earn
more interest.
Formula: Investment Deposit Ratio = Total Investment/ Total deposit
92.00%
90.00%
88.00%
86.00%
84.00%
90.80%
82.00%
87.80%
86.43%
80.00%
83.59%
78.00%
79.88%
76.00%
74.00%
2014
2015
Investment Deposit Ratio
2016
2017
Linear (Investment Deposit Ratio)
2018
Asset Quality Indicator
b) Equity Multiplier:
 Shows the percentage of assets that are financed or owed by the shareholders.
 Shows the level of debt financing is used to acquire assets and maintain operations.
 Like all liquidity ratios and financial leverage ratios, the equity multiplier is an indication of company risk
to creditors.
 Formula: Equity Multiplier= Total Assets/Total Equity Capital
20
18
17.75614
17.99207
2017
2018
16.3354
15.34632
16
13.98408
14
12
10
8
6
4
2
0
2014
2015
2016
Equity Multiplier
Market Value
a) Price Earnings Ratio:
 The ratio for valuing a company that measures its current share price relative to its per-share earnings.
 The price-earnings ratio is also sometimes known as the price multiple or the earnings multiple.
 Formula: P/E Ratio=Market Value Per Share/Earnings Per Share
14
12
10
8
6
11.24
12.24
11.54
10.11
4
6.87
2
0
2014
2015
2016
2017
2018
P/E Ratio(Times)
Banks with a high Price Earnings Ratio are often considered to be growth stocks. This indicates a positive future
performance, and investors have higher expectations for future earnings growth and are willing to pay more for them.
Recommendation
 The bank should try to increase current asset and cash.
 Debt to Equity Ratio is increasing. But higher debt equity ratio also mean that higher risk to the money. So, the bank
should keep its total debt to total asset ratio in control.
 The debt to total asset ratio is increasing over the years. But if the risk goes too high, the investors won’t invest. So, it is
bad. We can say that the bank should keep its total debt to total asset ratio in control.
 Net profit margin was decreasing over the four year and then increasing. It is very important to increase the net profit. By
investing the capital more profitable sector, reducing non-expenses and pay off the liabilities properly bank can increase
the net profit ratio.
 Net operating margin ratio is also decreasing. So it should be increased by reducing the operating expense, enhancing the
operating income and total assets.
 Return on equity was decreasing in 2014 after that it is increasing gradually. The bank should concern on more net profit
after tax.
Recommendation
 Return on asset represents the banks efficiency of managing balance sheet. Higher means the bank can maintain its
resources more efficiently. The ratios show a slight increase in its trend line.
 Tax Management Ratio of Islami bank has been fluctuating. In this case, it is advisable to increase this ratio by increasing
net income after tax compared to before.
 Expense control efficiency ratio will tell us how efficiently the company is managing its expense. The higher the
percentage, the better. It is used to determine how well a bank is using its available assets to generate a profit. But the ratios
of expense control efficiency show that there is less improvement in their expense control efficiency. It is suggested that
Islami bank should more efficiently controlling its expenses.
 There is a slight increase in degree of of Islami bank which is a good sign and the bank should try to maintain it by
increasing total operating revenue compasset utilizationared to total assets.
Recommendation
 The operating efficiency ratio of Islami Bank has been fluctuating over the year. This deceasing trend reflects that the
operating revenue is increasing at a lower rate than the operating expense. The bank should try to increase the operating
revenue than its operating expense.
 The capital adequacy ratio determines a bank’s capital to its risk. The bank has try to minimum requirement and also try
to maintain its increasing trend. But the bank should also look at it in a competitive perspective and increase its tier 1
capital more.
 The investment deposit ratio of Islami Bank has increased over the years which is a good sign for the bank. So, the bank
should keep this increasing trend.
 Equity multiplier is a ratio which is good when it increases. But if it is too high, it is bad for the bank. Higher equity
multiplier means higher risk of insolvency. Islami Bank has a increasing trend in its equity multiplier. Which is not a
good sign. So, the banks focus on this matter should be to not make this go too high.
 Price earnings ratio are often considered to be growth stocks. So, the higher of the ratio is favourable for the bank. But
the price earnings ratio of Islami bank has been fluctuating. So, the bank should increase its price earnings ratio.
Nafis Fuad
ID:1703014
REG. NO:07655
The ratios of Janata Bank Limited in the
last 5 years.
Ratio
2018
2017
2016
2015
2014
Current ratio
4.907
5.08
0.421
2.419
2.71
Debt to total
asset
20.34%
19.62%
19.81%
63.606%
100%
Return on total
asset
0.94%
17.70%
1.70%
1.70%
1.927%
Return on equity
1.18%
2.56%
4.689%
4.689%
3.182%
Earnings per
share
0.120
0.260
0.243
0.455
0.326
Current Ratio: Current ratio is balance-sheet financial performance measure of
company liquidity. Current ratio indicates a company's ability to meet short-term
debt obligations. The current ratio measures whether or not a firm has enough
resources to pay its debts over the next 12 months.
Current Ratio
6
5
4
3
4.907
0
5.08
2
2.419
1
2.71
0.421
0
2018
2017
2016
2015
2014
Debt Ratio: Debt ratio is a solvency ratio that quantifies a firm's overall
liabilities as a percentage of its total assets. In other words, the debt
ratio exhibits a company's ability to pay off its liabilities with its assets
Debt to total Asset
120
100
80
60
100
40
63.606
20
20.34
19.62
19.81
2018
2017
2016
0
2015
2014
Return on asset (ROA): Return on assets (ROA) is an indicator of how profitable a
company is relative to its total assets. ROA gives an idea as to how efficient management
is at using its assets to generate earnings. Calculated by dividing a company's annual
earnings by its total assets, ROA is displayed as a percentage. Sometimes this is referred to
as "return on investment".
20
Return to total asset
18
16
14
12
10
17.7
8
6
4
2
0
0.94
2018
2017
1.7
1.7
1.927
2016
2015
2014
Earnings per Share (EPS)Investors would like to know how much profit is
generated by each share they hold and EPS provides this valuable information.
The market fetches higher prices for high profit growth companies. Small
capitalization companies with high profits will naturally show attractive EPS
Earnings per share
0.5
0.45
0.4
0.35
0.3
0.25
0.455
0.2
0.326
0.15
0.26
0.1
0.05
0.243
0.12
0
2018
2017
2016
2015
2014
Return on Equity: Return on equity (ROE) is the amount of net income returned as a
percentage of shareholders equity. Return on equity measures a corporation's profitability
by revealing how much profit a company generates with the money shareholders have
invested.
Return on Equity
5
4.5
4
3.5
3
2.5
4.689
4.689
2
3.182
1.5
2.5
1
0.5
1.18
0
2018
2017
2016
2015
2014
Findings:











1. In Most cases, after analysing through several variables, it can be said that the year
2017
was not good enough for Janata Bank Limited as most of the ratio displayed several
poor
performances.
2. The debt ratio of 2017 was not good enough compared to the other years and it is
found
that Janata bank might not be done well enough in terms of its long term insolvency.
3. Janata Bank Limited is doing well in its payment of interest on its outstanding debts.
Most
of the investor are highly concerned for this information.
4. Dividend payments to shareholders are quite well and a huge comeback from the
years
2013-2015 when the dividend payment was not good enough.
5. Janata Bank Limited is performing very poor gradually in terms of managing its net
income generated that by its assets.
Recommendation:

1. Janata bank Limited need to provide high concern on their investors and depositor’s

interest as the performances of the bank is decreasing in the most cases, the bank

might face lack of investor deposits in the coming future.

2. There is a tendency in the employees of Janata bank to wasting their time doing

nothing or walking around the bank, therefore, all the employees should be monitored

on daily basis and should be provided specialization training in their own field.

3. I highly felt the absence of ethical or moral obligations while working there as an

intern. If employees are not treated and serve well just because the bank is

government owned and employees are on a permanent salary basis is highly

responsible for the performances of the bank today.

4. The net profit margin, the payments of dividend and the payment of interest on

outstanding debts have improved recently in 2017 and Janata Bank needs maintain

there proportion for saving their current investor’s interest.

5. Managing the banks net income generated that by its assets and profits from its

shareholders' investments were very poor. The bank need to give high importance to

tackle the situation.
Mehedi Hasan Anik
ID:1703016
Reg:07657
Shahjalal Islami Bank
limited
 Shahjalal Islami Bank Limited (SJIBL) is a sharia
compliant private sector commercial bank
in Bangladesh. The Headquarters of Shahjalal Islami
Bank is situated in Dhaka, Bangladesh. Some of its
products are Banking services, Consumer Banking,
Corporate Banking, Investment Banking, etc.
Current Ratio
1.58
1.24
2013
2014
Quick Ratio
1.43
1.4
2015
Column1
1.25
1.26
2016
2017
1.21
2013
2014
1.27
2015
Series 1
1.12
2016
2017
Inventory turnover
14.52
Fixed asset turnover
14.97
82.97
9.97
9.2
30.62
16.13
13.24
2013
2014
2015
Series 1
2016
2017
2.66
2013
2014
2015
Series 1
2016
2017
Debt to total asset
Total asset turnover
0.9
0.92
0.78
26.88%
0.42
18.29%
13.83%
0.145
2013
2014
2015
Series 1
2016
14.97%
14.40%
2016
2017
2017
2013
2014
2015
Series 1
2017
Net profit margin
Return on total asset
32.28%
3.88%
2013
8.11%
7.76%
2014
7.155
2015
Series 1
2016
2017
3.53%
2013
2014
4.70%
2015
Series 1
6.40%
2016
6.13%
2017
Earnings per share
0.74
0.71
0.68
0.55
0.41
2013
2014
2015
Series 1
2016
2017
Findings
• It has declined in 2016 and company has a difficulty of paying its
obligations although the current ratio was in increasing rate.
• SJIBL has some illiquid current ratio it has increased the liabilities
portions
•
Debt to Asset ratio is Decreasing in last few year.
• I also observed that SJIBL is facing cash shortage problem as their
accounts payback period is higher and it took much time to pay
back to its creditors.
Recommendations
• Proper utilization of man power as well as assets is required for
SJIBL in order to increase the sales rate and inventory turnover
ratio.
• I would like to add that SJIBL financial management practice
needed to be improved and they need to take some effective
solution so that SJIBL can hold their reputation as a business icon in
the Banking sector.
Trend Analysis
 According to the current ratio, Islami Bank Bangladesh Ltd. has the higher liquidity than other banks here.
 Here, Islami Bank Bangladesh Ltd. also have a higher ratio if 16.99. Which means, the bank’s ability to pay back their
liabilities is higher. Also their liabilities will decrease.
 The Islami Bank Bangladesh Ltd. has a higher ratio than other banks in total debt to total asset ratio. So, their bank is
exposed to greater risks, also their profit is good, in good times.
 Exim Bank Ltd has the highest net profit margin among these banks. Therefore, their income generated from each
dollar (taka) is higher than other banks.
 Here Eastern Bank Ltd. has the highest net operating margin, so, in case of Net Operating Margin, Eastern Bank is
better than others.
 Jamuna Bank’s profit from shareholders equity is higher that other banks so, it is more desirable to the investors.
 Eastern Bank Ltd. has the highest return on assets. So, its income from asset is more than others.
Trend Analysis
 The Eastern Bank Ltd. has the highest return on deposits ratio over the five years. Which indicates the bank has to pay the
depositors less than its competitors. So, it is good for the bank. But in a depositor’s perspective, Islami Bank Bangladesh
Ltd. best.
 Prime Bank Ltd. has the highest net income after tax on and average of 5 years.
 Eastern Bank is the most efficient in controlling their expense out of the banks here.
 The Jamuna Bank and the prime bank both relatively the same asset utilization ratio and both banks ratio can be seen
declining. But Jamuna Bank has higher average, so, it is utilizing its asset better.
 Exim Bank is the most efficient in operating its works efficiently and thus earning more profit in this perspective.
 Here the Eastern Bank can absorb more losses, in other cases this bank is more durable than other in this perspective.
 Islami Bank Bangladesh’s investment is increasing faster than deposit, more than its competitors.
 Islami Bank Bangladesh Ltd. has higher risk of insolvency. But it also means their profit is more.
 The Islami Bank Bangladesh Ltd. has by far the highest price earnings ratio than other banks. So, it is best in this sector.
Recommendation
 After the comparison, we conclude that Islami Bank Bangladesh Ltd is the best bank among the
banks we have analysed both for the investors and the bank.
 Islami Bank is lacking behind in every ratio in profitability ratio, but on average its profit is
standard.
 The same can be said for the efficiency ratios because its ratios don’t fluctuate too much as a result
the bank doesn’t face insolvency.
 And for the rest of the ratios IBBL is standing at the top among the mentioned banks. The IBBL
should improver their profitability ratios as well as their efficiency ratios.
Thank You All