A Project Report

on
Profitability Analysis
Of

Submitted in the fulfillment of the requirement of +3 3rd Year(Commerce)

By

Name-Barsha Rani Nayak

Class- Final Year (6th Sem)
Roll Number-
Sub- Business Research Method
Fundamental of Investment
(DSE-4)
Under the guidance of

Dr. Sabitri Sahu

(Lecturer Of Commerce)
1
 CERTIFICATE

This is to certify that the project report

entitled “PROFITABILITY ANALYSIS OF BANK OF
BARODA” is a record of research work done by Barsha
Rani Nayak during the period of study under my
guidance and supervision. This thesis has not formed the
basis for the award of any degree, diploma, fellowship or
other similar title. It represents an independent work on
the part of the candidate.

Date: Signature
Place: Berhampur (Dr. Sabitri Sahu)

2
 DECLARATION
I hear by declare that the Project Work with
the title “PROFITABILITY ANALYSIS OF BANK OF
BARODA” submitted by me under the guidance of Dr.
Sabitri Sahu for the partial fulfillment of the degree of
B.com. Honours in Accountancy under Mahamayee
Mahila Degree Mahavidyalaya are my original work and
has not been submitted earlier to any other
University/Institution for the fulfillment of the
requirement of any course of study.

I also declare that no chapter of this

manuscript in whole or in part has been incorporated in
this report from any earlier work done by others or by
me. However, extracts of any literature which has been
used for this report has been duly acknowledged
providing details of such literature in the references.

Signature of the Candidate

(BARSHA RANI NAYAK)

3
 Acknowledgement

I feel delighted to express my gratitude and response to

all those distinguished personalities who gave guided and
inspired me for the successful completion of this project
report.

I am extremely thankful to the Dr. Sabitri Sahu and all

faculties members of B.com of Mahamayee Mahila
Degree Mahavidyalaya for their condition and
cooperation and for there kind guidance and
encouragement.

I also thankful to my friends who gave more or less

contributed to the preparation of this project report. I
will be always indicated to them.

The study has indeed helped me to explore more

knowledgeable avenues related to my topic and I am sure
it will help me in my future.

Barsha Rani Nayak

B.com 3 rd year

4
 CONTENTS
Sl.No CHAPTERS Page
No
CHAPTER-1 INTRODUCTION 6
1.1 Introduction
1.2 Objective Of The Study
1.3 Justification Of The Study
1.4 Research Methodology
1.5 Limitation Of The Study
1.6 Top 10 Commercial Bank
CHAPTER-2 PROFILE OF BANK OF BARODA 15
2.1 Introduction
2.2 Vision
2.3 History
2.4 Logo
2.5 Key members
2.6 Products And Services
CHAPTER-3 Data Analysis And Interpretation 34
3.1 Introduction
3.2 Concept Of Probability
3.3 Analysis Of Probability
3.4 Profitability Analysis from the view Point
of Management
3.5 Profitability Analysis from the view Point
of Share-holders
CHAPTER-4 CONCLUSION 48
BIBLIOGRAPHY 53

5
 CHAPTER-1
INTRODUCTION

1.1 INTRODUCTION:
Financial performance is the process of measuring how
effectively a company utilizes its assets from primary mode of
business to raise incomes it also measures organizations whole
financial health over a particular period of time. Financial
performance of the organization deals with the financial
strength and weaknesses of bank accurately establishing a
relationship between the balance sheet and income statement.
This process used to clearly understand the growth of long- term
and short-term of bank. There are several ways to analyze data
the researcher used ratio analysis in this research. This analysis
also helpful determines the credit worthiness of the bank to
evaluate the market position among the competitors.

A commercial bank is a type of bank that provides

services such as accepting deposits, making business loans, and
offering basic investment products that is operated as a business
for profit.

It can also refer to a bank, or a division of a large bank,

which deals with corporations or large/middle-sized business to
differentiate it from a retail bank and an investment bank. A
commercial bank is where most people do their banking, as
opposed to an investment bank.

6
1.2 OBJECTIVE OF THE STUDY:
Objectives are the ends that states specifically how
goal be achieved. Every study must have an objective for which
all the efforts have been done. Without objective no research can
be conducted and no result can be obtained. On the basis of
objective all the research process is followed. Objectives are the
main aspect of every study. The objective of the study gives
direction to go through the research problem. It guides the
researcher and keeps him on track.
I have two objectives regarding my research project. These are
shown below :-
1. Primary objective
2. Secondary objective

1.Primary objective :-
1. To study the software used in Bank of Baroda.
2. To analyse the financial statements of the corporation to
it’s true financial position by the use of ratios.

2. Secondary objective :-
1. To find out the shortcomings in Bank of Baroda
2. To see whether BOB is going well or not in different areas
3. To inform the management about the financial condition of
Bank of Baroda
4. To inform the investor, enabling them to take the
investment decision.

7
1.3 JUSTIFICATION OF THE STUDY:
Financial Statements are prepared primarily for
decision-making. They play a dominant role in setting the
framework of managerial decisions. But the information in the
financial statement is not an end in itself as no meaningful can
be drawn from these statements alone.

The information provided in the financial statement is of

immense usein making decisions through analysis and
interpretation of financial statements. The financial analysis is
the process of identifying the financial strength and weakness of
the firm by properly establishing relationship between the items
of the balance sheet and P&L A/C.

There are various methods or techniques used in

analyzing financial statement such as comparative statement,
trend analysis, common size statement, schedule of changes in
working capital, fund flow and cash flow analysis, cost volume
profit analysis and "RATIO ANALYSIS".

Ratio analysis is one of the most powerful tool of financial

analysis. It is a process of establishing and interpreting various
ratios that the financial statements can be analyzed more clearly
and decisions made from such analysis. Just like a DOCTOR
examines his patient by recording his body Temperature, blood
pressure etc before making his conclusion regarding the illness
and before giving his treatment, a financial analyst analysis the
financial statement with various tools of analysis before
commenting upon the financial health or weaknesses of an
enterprise.
8
 The purpose of financial analysis is to diagnose the
information contained in financial statements so as to judge the
profitability and financial soundness of the firm. Financial
statement analysis is an attempt to determine the significance
and meaning of financial statement data so that forecast may be
made of the future earning, ability to pay interest and debt
maturities and profitability of a sound dividend policy.

A financial ratio is the relationship between two

accounting figures expressed mathematically ratio provide clues
to the financial position of the concern. These are the pointers
and indicators of financial strength, soundness, position or
weakness of an enterprise. One can draw conclusions about the
exact financial position of a concern with the help of ratios.

1.4 RESEARCH METHODOLOGY:

This study is quantitative nature meaning it
primarily deals with financial statement of Bank of Baroda for
the past five years. This study is based on secondary data which
is taken from banks website and the annual reports. The data is
analyzed by the ratio analysis .

1.5 LIMITATION OF THE STUDY:

 The study is restricted only the five financial years
i.e.2016,2017,2018,2019 and 2020.
 The study completely based on secondary data and the
accuracy of the analysis depends on the data obtained.
 This study may not be extensive enough to cover all the
ratios to be considered in evaluating the financial
soundness of the bank accurately.
9
1.6 TOP 10 COMMERCIAL BANKS:
1. State Bank of India (SBI):
State Bank of India is the largest and one of the
oldest banks operating in India. It is a government-owned
company established in 1955 and has its headquarters in
Mumbai. SBI deals in banking and financial-related services
having a presence internationally. Forbes has ranked this bank at
the 216th position in its “Fortune Global 500” list which contains
the names of the largest corporations all over the world in 2017.
After merging with its 5 associate banks and Bharatiya Mahila
Bank on April 1, 2017, this bank has accomplished in serving
more than 42 crore customers through more than 24,000
branches and over 59,000 ATM facilities. The bank also enjoys
an international presence with 233 offices set up in 32 counties.

Market Capitalisation: Rs. 3,67,738 crores

Total Assets: Rs. 48,45,619 crores

2. ICICI Bank:
ICICI(Industrial Credit and Investment Corporation of
India)Bank is India’s largest private sector bank. The bank,
which was a wholly owned subsidiary of ICICI Limited, is a
multinational banking and financial company based in Mumbai,
Maharashtra, India with its registered office in Vadodara,
Gujarat.
ICICI Bank was the first Indian bank to list on the
NYSE in 2000, along with its 5 million American Depository
Shares, which was oversubscribed 13 times the offer size. It

10
operates a network of 5,288 branches and 15,158 ATMs in India
and is present in 19 countries worldwide.

3. HDFC Bank:
Founded in 1994, HDFC Bank is headquartered in
Mumbai, Maharashtra. HDFC is India’s largest private sector
bank in terms of assets and market capitalization. It employs
around 1,16,971 staff as of March 2017 and operates a
distribution network of 5,485 branches and 15,541 ATMs across
2,866 cities & towns.
The bank is also present in Bahrain, Hong Kong, and
Dubai. The company’s financials as of March 2020 are below:
Total Revenues: 1,47,068.27 cr.(US$21 billion)
Total Assets: 15,80,830.44 cr.(US$220 billion)
Profits: 27,253.95 crores (US$3.8 billion)
4. Axis Bank:
Axis Bank is the third largest private sector bank in
India after ICICI and HDFC. It manages 4,050 branches and
11,801 ATMs & 4,917 Cash Recyclers across the country as of
31st March 2019.
The bank’s financial data as of March 2020 is as follows:
Revenue: 80,057.67 crores(US$11 billion)
Net Income:1853.11 crores(US$260 million)
Total Assets: 9,71,871 crores(US$130 billion)
Total Equity: 85,776.09 crores(US$12 billion)
No. of Employees: 78,300
5. Kotak Mahindra Bank:
Kotak Mahindra Bank is considered one of the
upcoming commercial banks in India and is the fourth biggest
private-sector bank in the country according to market
11
capitalization. The bank was founded by Uday Kotak in 1985. It
operates a network of 1,600 branches and 2,519 ATMs across
the country. It employs 46,500 staff following its Rs 15,000 crore
(US$2.3 billion) merger with ING Vyasa Bank in 2015. The
bank’s financial results as of March 2020 numbers are as follows:

Revenues: INR 50,365.74 crores(US$7.1 billion)

Net Income: INR 8,593.36 crores(US$1.2 billion)
Total Assets: 4,43,172.71 crores(US$62 billion)

6. IndusInd Bank:
The bank was founded in 1994 by Hinduja Group.
Known for its strong remittance business, IndusInd Bank’s
market capitalization is Rs 77,720 crores. The bank employs
around 30,674 staff through a network of 2,000+ branches and
around 2,545 ATMs across the country. As of March 2020, total
revenue was US$5.0 billion and total assets were US$43 billion.

7. Bank of Baroda (BOB):

Established in 1908, Bank of Baroda is the second
largest nationalized bank having its headquarters in Vadodara in
Gujarat and corporate office in Mumbai. The bank provides
services relating to banking and finance. Currently, it has 8,230
branches functioning all over the world (including 96 overseas
branches) and more than 13,193 ATM facility centers across
India. BOB caters to more than 120 million customers in around
25 countries all over the world. Its services include debit and
credit card facilities, loans, and wealth management.

Market Capitalisation: Rs. 42,069 crores

12
Total Assets: Rs. 11,99,942 crore

8. Punjab National Bank (PNB):

Punjab National Bank was established on 12th April
1895 in Lahore under the leadership of Lala Lajpat Rai as a part
of the Swadeshi movement. It became the first bank on the
Indian soil to be solely managed by the Indians by utilizing
Indian capital. PNB has its headquarters in New Delhi. Since the
bank came into operations, it has merged with seven banks.
There are over 13,000+ ATM centers and 12,248 branches of this
bank which includes 62% of the branches set up in semi-urban
and rural areas.

Market Capitalisation: Rs. 43,823 crores

Total Assets: Rs. 8,51,457.25 crore(US$120 billion)

9. YES Bank:
Founded in 2004 by Mr. Rana Kapoor and Mr. Ashok
Kapoor, YES Bank is known as a “FullService Commercial Bank.”
The bank is known for its excellent Non-Performing Assets
(NPA) ratio, which is the lowest in the industry. YES Bank lists
total assets of INR 2,73,543 crores as of March 2020. It also
posted total revenues of INR 14,257 crores and a net profit of
INR 2,665 crores in the same period.

10. IDBI Bank:

IDBI Bank (Industrial Development Bank of India) is
counted among the largest commercial banks of India. The bank
was established in 1964 and is headquartered in Mumbai. IDBI
13
has played a major role in building the nation during the last 55
years. It functioned as a pinnacle Development Financial
Institution (DFI) from 01st July 1964 to 30th September 2004 in
the industrial sector and from 01st October 2004 onwards, the
bank became a full-fledged commercial bank. The bank has
about 3394 ATM centers and 2095 branches including one in
Dubai. The Life Insurance Corporation of India (LIC) has
received a final approval on 29th June 2018 from Insurance
Regulatory and Development Authority of India (IRDAI) to hold
up to 51% stake in IDBI.

Market Capitalisation: Rs. 42,041 crores

Total Assets: Rs. 3,00,713 crore(US$42 billion

14
 CHAPTER-2
PROFILE OF BANK OF BARODA

2.1 INTRODUCTION:
Bank of Baroda (BOB) is an Indian government
owned banking and financial services company. It is under the
ownership ofMinistry of Finance , Government of India. It is the
third largest government owned bank in India, with million
customers, a total business of US$218 billion, and a global
15
presence of 100 overseas offices. Based on 2019 data, it is ranked
1145 on Forbes Global 2000 list.

The government of India announced the merger of Bank of

Baroda, Vijaya Bank and Dena Bank on September 17, 2018, to
create the country's second largest lender. The amalgamation is
the first-ever three-way consolidation of banks in the country,
with a combined business of Rs14.82 trillion (short scale),
making it the third largest bank after State Bank of India (SBI)
and ICICI Bank.

The Maharaja of Baroda, Mahara0ja Sayajirao Gaekwad III,

founded the bank on 20 July 1908 in the Princely State of
Baroda, in Gujarat. The Government of India nationalized the
bank, along with 13 other major commercial banks of India on
19 July 1969; the bank has been designated as a profit-making
public sector undertaking (PSU).

2.2 VISION:
To be the leading provider of financial services in India and
a major global bank.

MISSION:
It will leverage the people, technology, speed and financial
capital to:
o Be the banker of first choice for the customers by delivering
high quality, world-class products and services.
o Expand the frontiers of the business globally.

16
 o Play a proactive role in the full realization of India‟s
potential.
o Maintain a healthy financial profile and diversify the
earnings across businesses and geographies.
o Maintain high standards of governance and ethics.
o Contribute positively to the various countries and markets
in which we operate.
o Create value for the stakeholders.
2.3 HISTORY:
In 1908, Maharaja Sayajirao Gaekwad III, set up the
Bank of Baroda (BoB), with other stalwarts of industry such as
Sampatrao Gaekwad, Ralph Whitenack, Vithaldas Thakersey,
Tulsidas Kilachand and NM Chokshi. Two years later, BoB
established its first branch in Ahmedabad. The bank grew
domestically until after World War II. Then in 1953 it crossed
the Indian Ocean to serve the communities of Indians in Kenya
and Indians in Uganda by establishing a branch each in
Mombasa and Kampala. The next year it opened a second
branch in Kenya, in Nairobi, and in 1956 it opened a branch in
Tanzania at Dar-es-Salaam. Then in 1957, BoB took a big step
abroad by establishing a branch in London. London was the
center of the British Commonwealth and the most important
international banking center. In 1958 BoB acquired Hind Bank
(Calcutta; est. 1943), which became BoB's first domestic
acquisition.

1990s
In 1992, BoB opened an OBU in Mauritius, but closed its
representative office in Sydney. The next year BoB took over the
London branches of Union Bank of India and Punjab & Sind
17
Bank (P&S). P&S's branch had been established before 1970 and
Union Bank's after 1980. The Reserve Bank of India ordered the
takeover of the two following the banks' involvement in the
Sethia fraud in 1987 and subsequent losses.

Then in 1992 BoB incorporated its operations in Kenya

into a local subsidiary. The next year, BoB closed its OBU in
Bahrain.

In 1996, BoB Bank entered the capital market in

December with an initial public offering (IPO). The Government
of India is still the largest shareholder, owning 66% of the bank's
equity.
In 1997, BoB opened a branch in Durban. The next year
BoB bought out its partners in IUB International Finance in
Hong Kong. Apparently this was a response to regulatory
changes following Hong Kong's reversion to the People's
Republic of China. The now wholly owned subsidiary became
Bank of Baroda (Hong Kong), a restricted license bank. BoB also
acquired Punjab Cooperative Bank in a rescue. BoB incorporate a
wholly–owned subsidiary, BOB Capital Markets, for broking
business.

In 1999, BoB merged in Bareilly Corporation Bank in another

rescue. At the time, Bareilly had 64 branches, including four in
Delhi. In Guyana, BoB incorporated its branch as a subsidiary,
Bank of Baroda Guyana. BoB added a branch in Mauritius and
closed its Harrow Branch in London.

2000s
18
 In 2000 BoB established Bank of Baroda (Botswana). The
bank has three banking offices, two in Gaborone and one in
Francistown. In 2002, BoB converted its subsidiary in Hong
Kong from deposit taking company to a Restricted License Bank.
In 2002 BoB acquired Benares State Bank (BSB) at the Reserve
Bank of India's request. BSB had been established in 1946 but
traced its origins back to 1871 and its function as the treasury
office of the Benares state. In 1964 BSB had acquired Bareilly
Bank (est. 1934), with seven branches in western districts of
Uttar Pradesh; BSB also had taken over Lucknow Bank in 1968.
The acquisition of BSB brought BoB 105 new branches. Lucknow
Bank, a unit bank with its only office in Aminabad, had been
established in 1913. Also in 2002, BoB listed Bank of Baroda
(Uganda) on the Uganda Securities Exchange (USE). The next
year BoB opened an OBU in Mumbai.

In 2004 BoB acquired the failed south Gujarat Local Area Bank.
BoB also returned to Tanzania by establishing a subsidiary in
Dar-es-Salaam. BoB also opened a representative office each in
Kuala Lumpur, Malaysia, and Guangdong, China.
In 2005 BoB built a Global Data Centre (DC) in Mumbai for
running its centralised banking solution (CBS) and other
applications in more than 1,900 branches across India and 20
other counties where the bank operates. BoB also opened a
representative office in Thailand.

In 2006 BoB established an Offshore Banking Unit (OBU) in

Singapore.

In 2007, its centenary year, BoB's total business crossed 2.09

trillion (short scale), its branches crossed 2000, and its global
19
customer base 29 million people. In Hong Kong, Bank got Full
Fledged Banking license and business of its Restricted License
Banking subsidiary was taken over Bank of Baroda branch in
Hong Kong w.e.f.01.04.2007.

In 2008 BoB opened a branch in Guangzhou, China

(02/08/2008) and in Kenton, Harrow United Kingdom. BoB
opened a joint venture life insurance company with Andhra
Bank and Legal & General (UK) called IndiaFirst Life Insurance
Company.

2010
In 2010 Malaysia awarded a commercial banking licence to a
locally incorporated bank to be jointly owned by Bank of Baroda,
Indian Overseas Bank and Andhra Bank.

In 2011 BoB opened an Electronic Banking Service Unit (EBSU)

at Hamriya Free Zone, Sharjah (UAE). It also opened four new
branches in existing operations in Uganda, Kenya (2), and
Guyana. BoB closed its representative office in Malaysia in
anticipation of the opening of its consortium bank there. BoB
received 'In Principle' approval for the upgrading of its
representative office in Australia to a branch. Bob also acquired
Mumbai-based Memon Cooperative Bank, which had 225
employees and 15 branches in Maharashtra and three in Gujarat.
It had to suspend operations in May 2009 due to its precarious
financial condition.

The Malaysian consortium bank, India International Bank

Malaysia (IIBM), finally opened in Kuala Lumpur, which has a
large population of Indians. BOB owns 40%, Andhra Bank owns

20
25%, and IOB the remaining 35% of the share capital. IIBM
seeks to open five branches within its first year of operations in
Malaysia, and intends to grow to 15 branches within the next
three years.

On 17 September 2018, the Government of India proposed the

merger of Dena Bank and Vijaya Bank with the Bank of Baroda,
pending approval from the boards of the three banks. The

merger was approved by the Union Cabinet and the boards of

the banks on 2 January 2019. Under the terms of the merger,
Dena Bank and Vijaya Bank shareholders received 110 and 402
equity shares of the Bank of Baroda, respectively, of face value
₹2 for every 1,000 shares they held. The merger came into effect
on 1 April 2019. Post-merger, the Bank of Baroda is the third
largest bank in India, after State Bank of India and HDFC Bank.
The consolidated entity has over 9,500 branches, 13,400 ATMs,
85,000 employees and serves 120 million customers.

Bank of Baroda announced in May 2019 that it would either

close or rationalise 800–900 branches to increase operational
efficiency and reduce duplication post-merger. The regional and
zonal offices of the merged companies would also be closed. PTI
quoted an unnamed senior bank official as stating that Bank of
Baroda would look to expand in eastern India as it already had a
strong presence in the other regions.

2.4 Logo:
21
 The logo is a unique reresentation of a universal
symbol. It comprises dual “B” letterforms that hold the rays of
rising sun. The bank calls this the ‘Boarada Sun’, The sun is an
excellent representation of what the bank stands for. It is the
single most powerful source of light and energy, its far-reaching
rays dispel darkness to illuminate everything they touch.

Products and Services offered by the Bank

o Personal Banking
o Corporate Banking
o NRI Banking
o Rural & Agri Banking
o Loans-Home, Vechile,Education,Personal
o Cards-credit,Debit,Prepaid
o Wealth Management
o Supply Chain Fainance
o Digital Services-Internet Banking Mobile Banking and
other services

Rebarnding in 2005:
Even as the bank expanded its presence-both
nationaly and in the overseas markets, in 2005, it shed its
original logo of a hand and a wheel of industry and agriculture
within a circle and adopted a new logo – the Baroda Sun. Then,
on the thresold of adopting new international standards, the
Bank clearly intended to project itself as a modern and
technologically savvy bank. The new logo and the singing of
Rahul Dravid as a brand ambassador was a clear indication that
the bank was trying to adress the needs of the yunger
generation.

22
 Old logo Of Bank Of Baroda

Ever since the rebranding, the Bank has consistently proeted its
major strength with large interational presence ,technological
advanement and superior customer servise . with digitization all
around the bank has been leveraging this opportunity to
penetrate into masses and build a stronger brand presence.

2.5 KEY MEMBERS

KEY EXECUTIVES

Chairman (Non-Executive): Dr Hasmukh Adhia

Managing Director & CEO: Sri Sanjiv Chadha

BOARD OF DIRECTORS

Board Members

Dr. Hasmukh Adhia , Chairman

Sri Sanjiv Chadha, CEO

Sri Amit Agrawal

23
Shri Srinivasan Sridhar

Smt. Soundara Kumar

Smt. Parvathy V. Sundaram

Managing Director & CEO

Sri Sanjiv Chadha

Executive Director

Sri S.L. Jain

Executive Director

Shri Vikramaditya Singh Khichi

Executive Director

Sri Ajay K Khurana

2.6 Products And Services offered

2.6.1 PRODUCTS OFFERED:
A) DEPOSITS OFFERED
1.Fixed deposit:
Bank of Baroda offers simple Fixed Deposits (at very
competitive interest rates). which can be opened with a
minimum investment of Rs 1,000. The tenure of their deposit
must be a minimum of 7 days for deposit amount of Rs. 100- lacs
and above & minimum I5 days for amounts less than Rs.l lac.
Fixed deposit accounts can be opened with instructions payable
24
to 'either or Survivor’, payable jointly, payable to any one of the
depositor's etc.

2.Current deposit:
Current Deposits product is ideal for firm, companies,
institutions, HUF, individuals etc., who need banking facility
more frequently and provides flexibility through overdraft
facility. This is one of the most basic and flexible deposit
options, allowing transaction without limiting the numbers.
Bank of Baroda's Current Deposits are the back-bone of all
trading activities.

 Baroda Advantage Current Account

 Baroda Premium Current Account (BPCA)
 Baroda Premium Current Account-Privilege (BPCAP)

3.Saving deposit:
Depending on the nature of the account and the governing
terms and conditions, Bank of Baroda offers following Savings
Accounts:

 Baroda Centenary Savings Account

 Savings Bank Account o Super Savings Account
 Baroda Basic Savngs AC
 Baroda Salary Advantage Saving Account o Baroda Bachat
Mitra

B) LOANS OFFERED
25
  Home Loan
 Home Loans to NRIs / PIOs
 Home Improvement Loan
 Interest Subsidy Scheme for Housing The Urban Poor
(ISHUP)
 Loan Against Future Rent Receivables
 Mortgage Loan
 Advance Against Securities
 Education Loan
 Baroda Career Development Loan
 Auto Loan
 Two Wheeler Loan
 Car Loan to NRI
 Traders Loan
 Loan to Doctors
 Baroda Ashray (Reverse Mortgage Loan)
 Personal Loan
 Baroda Advance Against Gold Ornaments / Jewellery (At
Urban & Metro Center)
 Loan for financing Individuals for subscription to Public
Issues /IPO
 Baroda Additional Assured Advance (AAA)
(Resident/NRIs /PIOs)
 Baroda Traders Loan Against the Security of Gold
Ornaments /Jewellries (At Urban & Metro centers)
 Credit Risk Guarantce Fund Scheme for Low Income
Housing (CRGFS)  Baroda Traders Gold Card Scheme 
Baroda Premium Personal Loan

C)CREDIT CARDS OFFERED

26
1. BOBCARD Signature Offered (VISA):
BOBCARD presents these premium cards to offer its gratitude
to the High Net worth Individuals. Exclusively designed, these
cards are packed with great features and benefits. So, get your
signature Visa today and be a part of the evolution.

2. BOBCARD Platinum (VISA, MASTER &

ASSURE):
Bob card Platinum Credit Cards are designed to suit lifestyle
and stature and to empower the distinction and recognition you
desire. Its inbuilt offers and privileges bring elegance to your life
at case.

3. BOBCARD Titanium (MASTER):

Bob card Titanium is an innovation to take you beyond the
boundaries of Classic & Gold Cards. It is a value-added,
distinctive credit card that brings together exclusive MasterCard
privileges with inherited economy and suite of Bobcards. This
card is guaranteed to assist you to transform your lifestyle in the
most cost effective manner.

4. Co-Branded Card:
Bob card BBA cobranded Platinum Credit Card is an attempt to
pay gratitude to enduring and enreaching relationship of Bank
of Baroda and Bombay Bullion Association over several years.
The card is exclusively designed for BBA members. Its
distinctive features, benefits and privileges give an extra mileage
to BOB BBA relationship.

D) DEBIT CARDS OFFERED

27
1.Baroda Vision Electron:
Baroda Visa Elcctron Debit Card is an ideal choice for your
requirement of performance, simplicity, flexibility, and
worldwide recognition. For securing hotel reservations, buying
books online, or making everyday purchases Baroda Electron
offers value proposition, reliable form of payment, recognized in
more than 170 countries around the globe.

2. Baroda Maestro:
Baroda Maestro meets the growing requirement of enhanced
security in debit card usage and creates customer confidence. In
this card, authorization happens through Personal ldentification
Number, even for shopping transactions, similar to ATM
transaction. The card is issued in affiliation with Master Card
and is usable at any ATM/ Merchant outlet having MasterCard
logo and NFS member bank ATMs in the country. Baroda
Maestro card is an International debit card which can be used
within the country and abroad.

3. Baroda Master Card ‘Combi’ Gold:

Baroda Master Card 'Combi' Gold, a golden choice for our
premium customers, which is envisaged to meet their
requirement of higher spend/cash withdrawal. The card is
issued in affiliation with Master Card and is usable at any ATM/
Merchant outlet having MasterCard logo and NFS member bank
ATMs. The card makes merchant and online shopping very
convenient and safe. Baroda Gold debit card is usable within
India and abroad.

28
4.Baroda Visa Platinum:
Baroda Visa Platinum is an exclusive offer for all our esteemed
customers allows higher spending power, more cash withdrawal
limits apart from a host of offers extended by Visa International
and Bank. A true privileged class experience.

5.RuPay Debit Card:

It can be used only with PIN hence a more secured debit card.
Card would be accepted only at secured PIN based POS
terminals. It is available to all customers eligible for debit card
issuance.

2.6.2 SERVICES OFFERED:

A. Demat:
An individual, Non-Resident Indian, Foreign Institutional
Investor, Trusts, Clearing Houses, Financial Institution,
Clcaring Members and Mutual Funds can open a Demat
account.

Key Benefits:
 Buy and sell shares and stock of any company listed on the
stock exchange of India NSE and BSE
 Make on-line investment in mutual fund.
 Apply in IPO
 Trade in Futures and Options

29
  No threat of loss of shares due to faulty/bogus/forged
delivery.
 Dividend and issuance of bonus shares are directly credited
into linked accounts and Demat accounts respectively.
 No share transfer fees or stamp duty.
 Application can be made vide facility of ASBA (Application
Supported by Blocked Amount) wherein amount does not
get debited into the account and is remitted only when
shares are allotted.
 The shares trading account enables you to view live prices
watch lists and place transactions. The deposit account is
linked to the trading account for seamless transfer of funds.

B) Baroda Health
It is a Medical Insurance Scheme, available only to account
holders of our Bank, which takes care of the hospitalization
expenses incurred by the customer up to the amount of sum
insured.

Key Benefits:
 very low premium
 In this co-branded product, single premium (generally
payable for a single person) is payable and Medical Health
insurance cover is available to family of -4-(self. spouse and
2 dependent children) up to the amount insured without
any additional premium.
30
  A member or all the members in insured family can avail
hospitalization benefits during the policy period, to the
extent of aggregate sum not exceeding the sum insured.
 Premium paid is eligible for Income Tax exemption under
Section 80 D as per Income Tax Rules.

C) Remittances (Baroda Money Express):

The Baroda Money Express remittance facility ensures instant
payments and transfer of funds, saving you and your associates
from waiting endlessly for funds to get credited. The facility is
available at 345 branches across 53 centers in India inclusive of
all branches in Ahmadabad. Bangalore. Chennai, Delhi,
Hyderabad, Mumbai, and Pune. This facility is available for both
retail and corporate customers enabling efficient and casy
transfer of money. So no more delays in transfer of funds typical
of Bankers Cheque, Demand Drafts. Mail Transfers and
Telegraphic Transfers.

D) Collection Services:
All branches of Bank of Baroda have the facility of collecting
Cheque, Demand Drafts, and Interest Warrants. Dividend
Warrants. And Refund Orders, Clean Bills and Documentary
Bills from Customers and various centers. All Cheque and other
instruments are collected into properly introduced accounts
and sent for collection on the day of receipt from the customers
or the next working day. The Funds collected in this offering are
credited to the customer's account within a guaranteed period
of 7 days. Bank of Baroda's BOB Quick ensures a better
collection service. which creates new avenues of income and
ensures better investment of funds.
31
E)ECS(El ectronic Clearing Service):
This is a unique system under which Bank of Baroda helps
companies and institutions making heavy payments disburse
these amounts directly into the bank accounts of the
beneficiaries such as account holders, shareholders, investors
etc.

Key Benefits:
 prompt payment on the due date
 Convenient receipt of money reduces trips made to the
bank for depositing dividend/interest warrants.
 Elimination of fraudulent encashment against
instruments lost in transit.

F)Government Business:
Apart from rendering all other Personal banking services to its
customers/public, Bank f Baroda also works as Agency Bank for
undertaking various types of Govt. Business viz.

Following schemes are available at Bank of Baroda:

 Public Provident Fund 1968 Scheme (PPF)

 Senior Citizens Savings Scheme, 2004 (SCSS 2004)
 Govt. of India 8% Savings Bonds 2003 (Taxable)
 National Pension System (NPS) & NPS- Lite -
Swavalamban
 Collection of Central/State Taxes

G)Locker Facility Offered:

32
Bank of Baroda offers a safe, trustworthy space to store your
valuables. jewellery, documents and other things dear to you.

Key benefits:
 State-of-the-art Lockers, the safe deposit vaults with fully
occupied, latest burglar alarm systems.
 For additional safety. The Locker holder assigns a code
word which further increases security.
 Available in different sizes as per your requirement.
 These Lockers and their contents can be nominated to
people near and dear to you.

CHAPTER – 3
DATA ANALYSIS AND INTERPRETATION
33
3.1 INTRODUCTION
Profit is an excess of revenues over associated
expenses for an activity over a period of time. Terms with similar
meanings include ‘earnings’, ‘income’, and ‘margin’. Lord Keynes
remarked that ‘Profit is the engine that drives the business
enterprise’. Every business should earn sufficient profits to
survive and grow over a long period of time. It is the index to the
economic progress, improved national income and rising
standard of living. No doubt, profit is the legitimate object, but it
should not be over emphasised. Management should try to
maximise its profit keeping in mind the welfare of the society.
Thus, profit is not just the reward to owners but it is also related
with the interest of other segments of the society. Profit is the
yardstick for judging not just the economic, but the managerial
efficiency and social objectives also.

34
3.2 CONCEPT OF PROFITABILITY
Profitability means ability to make profit from all the
business activities of an organization, company, firm, or an
enterprise. It shows how efficiently the management can make
profit by using all the resources available in the market.
According to Harward & Upton, “profitability is the ‘the ability of
a given investment to earn a return from its use.”
However, the term ‘Profitability’ is not synonymous
to the term ‘Efficiency’. Profitability is an index of efficiency; and
is regarded as a measure of efficiency and management guide to
greater efficiency. Though, profitability is an important yardstick
for measuring the efficiency, the extent of profitability cannot be
taken as a final proof of efficiency. Sometimes satisfactory profits
can mark inefficiency and conversely, a proper degree of
efficiency can be accompanied by an absence of profit. The net
profit figure simply reveals a satisfactory balance between the
values receive and value given. The change in operational
efficiency is merely one of the factors on which profitability of an
enterprise largely depends. Moreover, there are many other
factors besides efficiency, which affect the profitability.

PROFIT & PROFITABILITY

Sometimes, the terms ‘Profit’ and ‘Profitability’ are
used interchangeably. But in real sense, there is a difference
between the two. Profit is an absolute term, whereas, the
profitability is a relative concept. However, they are closely
related and mutually interdependent, having distinct roles in
business.
Profit refers to the total income earned by the
enterprise during the specified period of time, while profitability

35
refers to the operating efficiency of the enterprise. It is the ability
of the enterprise to make profit on sales. It is the ability of
enterprise to get sufficient return on the capital and employees
used in the business operation.
As Weston and Brigham rightly notes “to the
financial management profit is the test of efficiency and a
measure of control, to the owners a measure of the worth of
their investment, to the creditors the margin of safety, to the
government a measure of taxable capacity and a basis of
legislative action and to the country profit is an index of
economic progress, national income generated and the rise in
the standard of living”, while profitability is an outcome of
profit. In other words, no profit drives towards profitability.
Firms having same amount of profit may vary in terms of
profitability. That is why R. S. Kulshrestha has rightly stated,
“Profit in two separate business concern may be identical, yet,
many a times, it usually happens that their profitability varies
when measured in terms of size of investment”.

3.3 ANALYSIS OF PROFITABILITY

Apart from the short term and long term creditors,
owners and management or a company itself also interests in the
soundness of a firm which can be measured by profitability
ratios. Profitability ratios are of two types those showing
profitability in relation to revenue and those showing
profitability in relation to investment. Together, these ratios
indicate firm’s overall effectiveness of operation.

With a view to appraise profitability, the analysis

has been made from the point of view of management and
shareholders. The management of the firm is naturally eager to
36
measure its operating efficiency. Similarly, the owners invest
their funds in the expectation of reasonable returns. The
operating efficiency of a firm and its ability to ensure adequate
returns to its shareholders depends ultimately on the profits
earned by it. The analysis throws the light on the following
questions:
1. Is the profit earned by the firm adequate?
2. What rate of return does it represent?
3. What is the rate of profit for various segments of the firm?
4. What is the rate of return to equity holders?
To evaluate the profitability and answer above questions, two
fold analyses is undertaken as shown under:

A.Profitability Analysis from the View Point of Management

1. Gross Profit to Net Revenue Ratio
2. Net Operating Profit to Net Revenue Ratio
3. Return on Capital Employed Ratio
B.Profitability Analysis from the View Point of Shareholders
4. Net Profit to Net Revenue Ratio
5. Return on Owners’ Equity Ratio

A.Profitability Analysis from the View Point of

Management
In order to pin-point the causes which are responsible
for low / high profitability, a financial manger should
continuously evaluate the efficiency of a firm in terms of profit.
The study of increase or decrease in retained earnings, various
reserve and surplus will enable the financial manger to see
whether the profitability has improved or not. An increase in the
balance of these items is an indication of improvement in

37
profitability, where as a decrease indicates a decline in
profitability. Following ratios are calculated to analyse the
profitability:

1. Gross Profit Ratio

Gross profit ratio is important for management because
it highlights the efficiency of operation and also indicates the
average spread between the operating cost and revenue. Any
difference position in this ratio is the result of a change in the
operating cost or revenue or both. The main objective of
computing this ratio is to determine the efficiency with which
operations are carried on.
The Gross Profit Ratio expresses the relationship
between gross profit and net revenue. Gross profit is taken as the
excess of total revenue over operating expenses. It is figured as
shown below:
Gross Profit
𝐺𝑟𝑜𝑠𝑠 𝑃𝑟𝑜𝑓𝑖𝑡 𝑅𝑎𝑡𝑖𝑜 = Net Revenue × 100
Gross Profit = Total Revenue – Operating Expenses

management as it implies that (i) the operating cost is relatively

low; (ii A high ratio of gross profit to revenue is a sign of good)
increase revenue income, operating cost remains constant; (iii)
operating cost decline, revenue income remains the same.
On the contrary, a low gross profit to revenue is
definitely a danger signal. It implies that (i) the profit is
relatively low; (ii) the operating cost is relatively high (due to
purchase of inputs on unfavourable terms, in efficient utilisation
of current as well as fixed assets and so on); (iii) low revenue
income (due to sever competition, inferior quality of services,
lack of demand and so on).
38
2. Net Operating Profit Ratio
The Net Operating Profit Ratio expresses the
relationship between net operating profit and net revenue. Net
Operating profit is taken as the excess of gross profit over non
operating expenses and depreciation. In other words we can say
profit before interest and taxes (EBIT). This ratio helps to find
out the profit arising out of the main business. In other words
this ratio helps to determine the efficiency with which affairs of
business are being managed. A high ratio indicates the
improvement in the operational efficiency of the business and
vice versa. It is figured as shown below:

𝑁𝑒𝑡 𝑂𝑝𝑒𝑟𝑎𝑡𝑖𝑛𝑔 𝑃𝑟𝑜𝑓𝑖𝑡 𝑅𝑎𝑡𝑖𝑜 =

Net Operating Profit
Net Revenue × 100
Net Operating Profit =
Gross Profit - (Non Operating Expenses + Depreciation)

3. Return on Net Capital Employed Ratio

This is the most important ratio for testing
profitability of a business. It measures satisfactorily the overall
performance of a business in terms of profitability. This Ratio
expresses the relationship between profit earned and capital
employed to earn it. The term ‘capital employed’ refers to long-
term funds supplied by the creditors and owners of the firm. The
term ‘return’ signifies operating profit before interest and taxes
(EBIT).

39
This ratio is more appropriate for evaluating the efficiency of
internal management. It indicates how well the management has
utilised the funds supplied by the owners and creditors. In other
words, this ratio intends to measure the earning power of the net
assets of the business. It is figured as shown below:

𝑅𝑒𝑡𝑢𝑟𝑛 𝑜𝑛 𝑁𝑒𝑡 𝐶𝑎𝑝𝑖𝑡𝑎𝑙 𝐸𝑚𝑝𝑙𝑜𝑦𝑒𝑑 =

Earnings Before Intrest∧Tax
Net Capital Employed ×100
Net Capital Employed=
Share Capital + Reserves + Long Term Loan – Losses.

A high ratio is a test of better performance and a low ratio is an

indication of poor performance. Higher the ratio, more efficient
the management is considered to have been using the funds
available.

B. Profitability from the View Point of

Shareholders
Being the real owners of the business, the
shareholders should continuously evaluate the efficiency of a
firm in terms of profit because they have permanent stake in
business. So, they are directly affected by the prosperity of
higher profit and adversity of losses suffered by the business.

An increase in the net profit after tax is an indication

of improvement in profitability and in turn improved financial
welfare of the owners and larger the share of dividend to them
and vice versa. Following ratios are calculated to analyse the
profitability from the shareholders point of view:

40
• Net Profit Ratio
• Return on Owner’ Equity Ratio

4. Net Profit Ratio

The net profit ratio indicates the ability of management to
operate the business with sufficient success not only to recover
from revenues of the period, all the expenses including
depreciation and interest, but also to leave a margin of
reasonable compensation to the owners for providing their
capital at risk. In other words, this ratio is the overall measure of
the firm’s ability to turn each rupee of revenue into profit.
The Net Profit Ratio expresses the relationship between net
profit and net revenue. Net profit is taken as the excess of net
operating profit over interest charges. It is the reserve of the
operating Expenses ratio. It is figured as shown below:

Net Profit
𝑁𝑒𝑡 𝑃𝑟𝑜𝑓𝑖𝑡 𝑅𝑎𝑡𝑖𝑜 = Net Revenue ×100

Net Profit (EBT) = Net Operating Profit – Interest Charges A

high ratio of net profit to revenue is a sign of good management
as it ensures adequate return to the owners as well as enables a
firm to withstand adverse economic conditions.

On the contrary, a low net profit to revenue is definitely a

danger signal. It has the opposite implications. If this ratio is not
adequate, the firm will fail to achieve satisfactory return on
shareholder’s funds.

In order to have a better idea of profitability, the gross profit

ratio and net profit ratio may be simultaneously considered. If
41
the Gross profit is increasing over last five years, but the net
profit is declining, it indicates that administrative expenses are
slowly rising.

5. Return on Owner’s Equity (Proprietary Ratio)

The ordinary shareholders, who bear all risks, participate in
management and are entitled to all the profits remaining after
outside claims, are the real owners of the business. Therefore,
the profitability of a firm, from the owner’s point of view should
be assessed in terms of the return to the ordinary shareholders.
Return on Owner’s Equity Ratio is a single most important ratio
for judging the profitability of an organization in terms of return
to the owners. This ratio reflects that how much the firm has
earned on the funds invested by the shareholders (Either directly
or through retained earnings).

This ratio is expressed in the percentage form of net profit

earned to the owner’s equity. It is figured as shown below:
Net Profit
Return on Owner’s Equity = Owners Equity ×100

In order to judge the efficiency with which the proprietor’s

Funds are employed in business, this ratio is ascertained.

3.4 PROFITABILITY ANALYSIS FROM THE VIEW POINT

OF MANAGMENT
1. GROSS PROFIT RATIO
Gross Profit
𝐺𝑟𝑜𝑠𝑠 𝑃𝑟𝑜𝑓𝑖𝑡 𝑅𝑎𝑡𝑖𝑜 = Net Revenue ×100

Table 3.1
42
 Gross Profit Ratio (percentages) in Bank of Baroda
From 2015-16 to 2019-20 (Rs. in crores)
Sl. No. Year Gross Profit Net Revenue Ratio
1 2015-16 33870 44178 76.66
2 2016-17 37597 49091 76.58
3 2016-18 40056 52739 75.95
4 2016-19 39402 54156 72.75
5 2016-20 39263 54965 71.43

Interpretation:
The Gross Profit Ratio of Bank of Baroda has been
presented in the Table No. 3.1. In Bank of Baroda, the Gross
Profit Ratio shows declining trend. It ranged between 76.66 per
cent in the year 2015-16 and 71.43 per cent in the year 2019-20
with an average ratio of 74.67 per cent.

2. NET OPERATING PROFIT RATIO

Net Operating Profit Ratio=
Net Operating Profit
Net revenue ×100

Table 3.2
Net Operating Profit Ratio (Percentages) In Bank of Baroda
From 2015-16 to 2019-20 (Rs. in crores)
Sl. No. Year Net Operating Net Ratio
Profit Revenue
1 2015-16 6742 44178 15.26
2 2016-17 8202 49091 16.70
3 2017-18 9238 52739 17.51
4 2018-19 7739 54156 14.29
5 2019-20 8102 54965 14.74

43
Interpretation:
The Net Operating Profit Ratio of Bank of Baroda has
been presented in the Table No. 3.2. In Bank of Baroda, the Net
Operating Profit Ratio shows fluctuating trend. It ranged
between 15.26 per cent in the year 2015-16 and 14.74 per cent
in the year 2019-20 with an average ratio of 15.7 per cent.

3. RETURN ON CAPITAL EMPLOYED RATIO

𝑅𝑒𝑡𝑢𝑟𝑛 𝑜𝑛 𝑁𝑒𝑡 𝐶𝑎𝑝𝑖𝑡𝑎𝑙 𝐸𝑚𝑝𝑙𝑜𝑦𝑒𝑑 =
Earnings Before Intrest∧Tax
Net Capital Employed ×100

Table 3.3
Return on Capital Employed Ratio (Percentages) In Bank
of Baroda
From 2015-16 to 2019-20 (Rs. in crores)
Sl No. Year EBIT Net Cpital Ratio
Employed
1 2015-16 44297 559886 7.91
2 2016-17 49771 614409 8.10
3 2017-18 55378 685968 8.07
4 2018-19 58905 740588 7.95
5 2019-20 56681 851995 6.65

Interpretation:
The Return on Capital Employed Ratio of Bank of
Baroda has been presented in the Table No. 3.3. In Bank of
Baroda, the Return on Capital Employed Ratio shows fluctuating

44
trend. It ranged between 7.91 per cent in the year 2015-16 and
6.65 per cent in the year 2019-20 with an average ratio of 7.73
per cent.

3.5 PROFITABILITY FROM THE VIEW POINT OF

SHAREHOLDERS

4. NET PROFIT RATIO

Net Profit
Net Profit Ratio= Net Revenue ×100
Table 3.4
Net profit Ratio (Percentages) In Bank of Baroda
From 2015-16 to 2019-20 (Rs. in crores)
Sl.No Year Net Profit Net Ratio
Revenue
1 2015-16 9810 44178 22.20
2 2016-17 11175 42091 22.76
3 2017-18 9726 52739 18.44
4 2018-19 9801 54156 18.09
5 2019-20 6777 54956 12.32

Interpretation:
The Net Profit Ratio of Bank of Baroda has been
presented in the Table No. 3.4. In Bank of Baroda, the Net Profit
Ratio has merely increased from 22.20 in 2015-16 to 22.76 in
2016-17 and then shows a declining trend. It ranged between

45
22.20 per cent in the year 2015-16 and 12.32 per cent in the
year 2019-20 with an average ratio of 18.76 per cent.

5. RETURN ON OWNER’S EQUITY

Net Profit
Return on Owner’s Equity = Owne r ' sEquity ×100

Table 3.5
Return on Owner’s Equity (Percentages) In Bank of Baroda
From 2015-16 to 2019-20 (Rs. in crores)
Sl.No Year Net Profit Owner’s Ratio
Equity
1 2015-16 9810 73213 13.39
2 2016-17 11175 80429 13.89
3 2017-18 9726 89735 10.83
4 2018-19 9801 99951 9.80
5 2019-20 6777 105158 6.44

Interpretation:
The Return on Owner’s Equity Ratio of Bank of Baroda has been
presented in the Table No. 3.5. In Bank of Baroda, the Return on
Owners’ Equity Ratio shows increasing trend from 2015-16 to
2019-20 and then shows a declining trend. It ranged between
13.39 per cent in the year 2015-16 and 6.44 per cent in the year
2019-20 with an average ratio of 10.87 per cent.

46
CHAPTER-4
CONCLUSION

47
 The study states that merger, was a good step for debt redden
bank like Dena bank. It consolidates human resource and assets
which deliver profitable business in terms of products and
services. In India it reduces bad loans and form new lending
policies. The large bank can penetrate business to rural as well as
urban areas. The important thing is that lending large corporate
will be done in systematic manner. The assets and values and
interest rate must be calculated by different methods, a bank
must not rely on a single one. The government’s move to merge
two better performing banks – Bank of Baroda and Vijaya Bank –
with a weak one – Dena Bank – is a good strategy to ensure
stability of both, operations and the credit profile of the
consolidated entity. The success of the three-way merger will be
crucial as it will pave the revival path for other weak state-owned
banks through mergers. Moreover, the merger will reduce the
capital burden for the government over the long term, and
enable better management of a smaller set of large nationalized
banks. The ability to manage potential challenges in terms of
balance sheet, people and processes and their impact on growth
and operating metrics over the medium term will determine the
success of future mergers.
Merging state-owned banks is lot more
challenging given the integration-related issues, especially
48
regarding human resources and operations? If this merger is
executed well it can set the path for future mergers among PSU
banks which will strengthen the banking sector in the country.
A commercial bank is a type of bank that provides
services such as accepting deposits, making business loans, and
offering basic investment products that is operated as a business
for profit.
It can also refer to a bank, or a division of a large bank,
which deals with corporations or large/middle-sized business to
differentiate it from a retail bank and an investment bank. A
commercial bank is where most people do their banking, as
opposed to an investment bank.
Commercial banks in India are broadly classified into
three categories:

Public Sector Banks:

The term “public sector banks” refers to a situation
where the majority equity stake in the banks is held by the
government. The Indian Government keeps default holdings of
minimum 51% shareholding, but management control is only
with the Central Government, thereby classifying them as Public
Sector Banks.

Public sector banks include the State Bank of India

and its Associates, Nationalized Banks (including Industrial
Development Bank of India Ltd (IDBI) since December 2004),
and Regional Rural Banks.

Private Sector Banks:

49
 They are the banks in which individuals and
corporations are the majority shareholders. In India, banks were
nationalized in two phases, in 1969 and 1980. In 1993, the
Reserve Bank of India (RBI), the regulating body for all the
country’s banking organizations, allowed many new commercial
banks in India to start operations. Some of the major
commercial banks in India that were given licenses are ICICI
Bank, HDFC Bank, Axis Bank, Yes Bank, and Kotak Mahindra
Bank.
Private sector banks are recognized as the banks for
the new generation, providing innovative products, better IT
support system and competitive pricing for their products. As of
the end of March 2017, there are 21 private sector banks in
India. Besides these, four local areas banks are also categorized
as private banks.

Foreign Banks:
They are the final category of banks that serve as an
important segment of the commercial banking sector. They are
headquartered outside India, and they operate from their
wholly-owned subsidiaries or branches in the country. The
foreign banks include Royal Bank of Scotland, Bank of America,
Barclays Banks, Deutsche Bank, etc.

Major findings:
 The Gross Profit Ratio of ICICI has been presented in the
Table No. 4.1. In ICICI, the Gross Profit Ratio shows
declining trend. It ranged between 76.66 per cent in the
year 2015-16 and 71.43 per cent in the year 2019-20 with
an average ratio of 74.67 per cent.
50
 The Net Operating Profit Ratio of ICICI has been presented
in the Table No. 4.2. In ICICI, the Net Operating Profit
Ratio shows fluctuating trend. It ranged between 15.26 per
cent in the year 2015-16 and 14.74 per cent in the year
2019-20 with an average ratio of 15.7 per cent.
 The Return on Capital Employed Ratio of ICICI has been
presented in the Table No. 4.3. In ICICI, the Return on
Capital Employed Ratio shows fluctuating trend. It ranged
between 7.91 per cent in the year 2015-16 and 6.65 per
cent in the year 2019-20 with an average ratio of 7.73 per
cent.
 The Net Profit Ratio of ICICI has been presented in the
Table No. 4.4. In ICICI, the Net Profit Ratio has merely
increased from 22.20 in 2015-16 to 22.76 in 2016-17 and
then shows a declining trend. It ranged between 22.20 per
cent in the year 2015-16 and 12.32 per cent in the year
2019-20 with an average ratio of 18.76 per cent.
 The Return on Owner’s Equity Ratio of ICICI has been
presented in the Table No. 4.5. In ICICI, the Return on
Owners’ Equity Ratio shows increasing trend from 2015-
16 to 2019-20 and then shows a declining trend. It ranged
between 13.39 per cent in the year 2015-16 and 6.44 per
cent in the year 2019-20 with an average ratio of 10.87
per cent.

51
 Bibliography

Web Series
www.mapsofindia.com
https://en.wikipedia.org
https://en.wikipedia.org
www.bankofbaroda.in

Books:
Accountancy, R.K. Mittal, A.K. Jain
Financial Management- Theory and practice, Shasi K. Gupta,
R.K. Sharma

52
53