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A
SYNOPSIS
ON
submitted to submitted by
MR. GOURAV AGRAWAL JYOTI THAKUR
mba iv sem.
PREFACE
Preparing a project of this nature is an arduous task and I was
fortunate enough to get support from a large number o persons. I wish to
express my deep sense of gratitude to all those who generously helped in
successful completion of this report by sharing their invaluable time and
knowledge.
JYOTI THAKUR
MBA IV SEM.
ACKNOWLEDGEMENT
Preparing a project of this nature is an arduous task and I was fortunate enough
to get support from a large number o persons. I wish to express my deep sense of
gratitude to all those who generously helped in successful completion of this report by
sharing their invaluable time and knowledge.
I feel extremely exhilarated to have completed this project under the able and
inspiring guidance of He rendered me all possible help me guidance while reviewing
the manuscript in finalising the report.
I also extend my deep regards to my teachers , family members , friends and all
those whose encouragement has infused courage in me to complete to work
successfully.
JYOTI THAKUR
MBA IV SEM.
JYOTI THAKUR
MBA IV SEM.
CERTIFICATE
submitted to submitted by
GOURAV AGRAWAL MOHANI BHATKARIYA
mba iv sem.
PREFACE
MOHANI BHATKARIYA
MBA IV SEM.
ACKNOWLEDGEMENT
Preparing a project of this nature is an arduous task and I was fortunate enough
to get support from a large number o persons. I wish to express my deep sense of
gratitude to all those who generously helped in successful completion of this report by
sharing their invaluable time and knowledge.
It is my proud and previledge to express my deep regards to Respected , Head of
I feel extremely exhilarated to have completed this project under the able and
inspiring guidance of He rendered me all possible help me guidance while reviewing
the manuscript in finalising the report.
I also extend my deep regards to my teachers , family members , friends and all
those whose encouragement has infused courage in me to complete to work
successfully.
MOHANI BHATKARIYA
MBA IV SEM.
MOHANI BHATKARIYA
MBA IV SEM.
CERTIFICATE
CONTENTS
1 TITLE OF PROJECT
2 CERTIFICATE
3 DECLARATION
4 ACKNOWLEDGEMENT
5 ABSTRACT
9 RESEARCH METHODOLOGY
11 LITERATURE REVIEW
12 DATA COLLECTION
15 REFERENCE
16 QUESTIONARRIE
LITERATURE REVIEW
INTRODUCTION
Performance and efficiency of commercial bank are the key element of efficiency and
efficacy of countries financial system. The broad objective of the banking sector
reforms in India has been to increase efficiency and profitability of the banks. Prior to
banking reforms, the industry was a near monopoly dominated by public sector bank.
Therefore this study attempts to apply profitability ratio, solvency ratio and
management efficiency ratio on SBI and ICICI Bank in order to compare their
efficiency and solvency position.
I. To compare the financial performance of State Bank of India and ICICI Bank.
ii. To know and compare the profitability position of State Bank of India and ICICI
Bank.
iii. To know and compare the managerial efficiency of State Bank of India and ICICI
Bank.
iv. To offer findings and suggestions to enhance the financial performance of State Bank
of India and ICICI Bank.
RESEARCH METHODOLOGY
5.1 Research Design
Descriptive Research Design is used for the study and it is essentially a fact-finding
approach. It aims to explain the characteristics of an individual or group characteristics
and to determine the frequency with the same things occurs.
5.2 Sample Design
Deliberate sampling technique is used for the study. This sampling method involves
purposive or deliberate selection of particular units of the world for constituting a
sample that represents the population.
5.3 Selection of the Sample Units
Banking sector in India is considered one of the fastest growing financial institutions in
the world. Using purposive sample, State Bank of India and ICICI Bank were selected
as the sample units for the study. The sample units selected were considered one of the
successful units in the banking sector.
5.4 Data Collection
The data were collected through annual report from sources that are secondary in nature
such as internet, magazines, websites, books, and journals.
5.5 Period of study
This study covers a period of five years, i.e., from 2010-11 to 2014-15
5.6 Tools Applied
The data collected were moderated for the study. The major tools applied for the
analysis of the data are ratios, percentages, and t-test.
PERIODITY OF STUDY
The project “A Study on comparative financial performance of SBI and ICICI
Bank” was undertaken during the period of 45 days as a part of my internal
examination.
Credit deposit ratio is the proportion of loan asset created by a bank from the deposit
received. Credits are the loan and advances granted by the bank. In other words, it is the
amount lend by the bank to a person or an organization which is recovered later on,
interest is charged from the borrower.
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Table 1.1 depicts that over the course of five financial periods of study the mean of
Credit Deposit Ratio in ICICI was higher (89.302%) than in SBI (76.184%). But the
Compound Growth Rate in SBI lowers 1.19% than in ICICI (8.51%). In case of SBI the
credit deposit ratio was highest in 2014-15 and lowest in 2012.13. But in case of ICICI
Credit Deposit Ratio was highest in 2014-15and lowest in 2010-11. This shows that
ICICI Bank has created more loan assets from its deposits as compared to SBI.
INTEREST EXPENSES TO TOTAL EXPENSES:-
The table 1.2 shows that the ratio of interest expenses to total expenses in SBI was
highly volatile it increased from 61.85 per cent to 63.27 per cent during the period
2010-11 to 2011-12. Afterwards it was decreased till 2013-14 and then again increased
to 57.90 per cent. The ratio of interest expenses to total expenses in ICICI was also
decreased from 66.135 per cent to 64.10 per cent during the period 2010-11 to 2011-12.
It remain stable from 2011-12 to 2012-2013 but Further it was increased to 65.19 per
cent in 2014-15. It has been found that the share of interest expenses in total expenses
was higher in case of SBI as compared to ICICI, which shows that people preferred to
invest their savings in SBI than ICICI.
The table 1.4 shows that the ratio of other income to total income was decreased from
16.10 per cent in 2010-11 to 11.00 per cent in 2014-15 in case of SBI. However, the
share of other income in total income of ICICI was also decreased from 22.38 per cent
in 2010-11 to 19.07 per cent 2014-15. The table shows that the ratio of other income to
total income was relatively higher in ICICI (21.44%) as compared to SBI (15.22%)
during the period of study.
NET PROFIT MARGIN:-
Net Profit Margin reveals the financial results of the business activity and efficiency of
management in operations. The table 5.8 shows the net profit margin in SBI and ICICI
during the Period 2010-11 to 2014-15.
The table 1.5 reveals that the ratio of net profits to total income of ICICI was varied
from 11.81 per cent to 17.45 percent whereas in case of SBI it is not stable. It increased
to 13.11 percent from 12.64 percent in 2011-12 then further decreased to 10.54 percent
in 2012-13 and 8.55 percent in 2013-14 and finally increased to 9.73 percent in 2014-15
during the period of 5 years of study. However, the net profit margin was higher in
ICICI (14.37%) as compared to SBI (10.91%) during the period of study. But it was
continuously decreased from 2010-11 to 2014-15 in ICICI. Thus, the ICICI has shown
comparatively lower operational efficiency than SBI.
NET WORTH RATIO:-
Net worth Ratio is used for measuring the overall efficiency of a firm. This ratio
establishes the relationship between net profit and the proprietor’s funds.
TABLE 1.6 NET WORTH RATIO
(IN PERCENT)
YEAR SBI ICICI
2010-11 13.70 8.94
2011-12 15.74 7.58
2012-13 13.91 7.79
2013-14 12.84 9.35
2014-15 14.36 10.70
MEAN 14.11 8.87
CGR 4.87 19.68
Source: Annual Reports of SBI and ICICI from 2010-11 to 2014-15
Net profit Ratio is used for measuring the profitability of the firm. It is calculated by
dividing net profit by net sales multiplied by 100. It establishes the relationship between
the net profit and sales.
TABLE 1.7 GROWTH OF PROFIT IN SBI AND ICICI
(IN CRORES)
The table 1.9 highlights that the mean value of total income was higher in SBI (Rs.
87,598.58 Crores) as compared to that in ICICI (Rs. 37282.114 crores) during the
period of study. However the rate of growth regarding total income was higher in SBI
(107.15 %) than in ICICI (4.49 %) during the period of study
TOTAL EXPENDITURE:-
The total expenditure reveals the proportionate share of total expenditure spent on the
development of staff, interest expended and other overheads.
TABLE 1.9 TOTAL EXPENDITURE OF SBI AND ICICI
(IN CRORES)
YEAR SBI ICICI
ADVANCES:-
Advances are the credit facility granted by the bank. In other words it is the amount
borrowed by a person from the Bank. It is also known as “Credit‟ granted where the
money is disbursed and recovery of which is made later on.
DEPOSITS:-
Deposit is the amount accepted by bank from the savers in the form of current deposits,
savings deposits and fixed deposits and interest is paid to them.
It shows the maximum numbers of people have their bank account in SBI and less
number of people has their bank account in ICICI Bank.
By seeing the graph, we can find that maximum number of people have current account
in SBI I.e. 50%. Savings account 25%, Joint account 15 %, and loan account 10%.
Whereas in ICICI 40% people have current account, 20 % have saving account, 30%
have joint account and 10 % people have loan account.
Q3. Does your bank create any recreation facility for the customers?
Not much difference is shown regarding recreational facilities to the customer between
two banks. However SBI has the leading role so far.
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Q4. Do you think that your bank caters all your banking needs?
RESPONSE(SBI) NO OF CUSTOMERS %
YES 17 85
NO 3 15
RESPONSE(ICICI) NO OF CUSTOMERS %
YES 8 80
NO 2 20
Not much difference is shown regarding bank caters all your banking needs to the
customer. However SBI has the leading role so far.
Q6. Which bank has ease of access (both branch and ATM)?
Bank No.of Respondent Percentage
SBI 17 85
ICICI 3 15
The graph shows that out of two banks SBI Bank provides more ease of access
regarding Branch and ATM.
7. Are you satisfied with the service provided by the bank?
Response (SBI) No.of Respondent Percentage
Very Satisfied 1 5
Satisfied 17 85
Somewhat 1 5
Satisfied
Not Satisfied 1 5
Response (ICICI) No.of Respondent Percentage
Very Satisfied - -
Satisfied 5 50
Somewhat 4 40
Satisfied
Not Satisfied 1 10
By seeing this graph we can find that SBI Customers are more satisfied than the ICICI
bank customers.
8. Do they charge unnecessarily for not maintaining minimum balance in your account?
Response(SBI) No. Of Customers Percentage %
Yes 3 15
No 17 85
The performance of bank also depends upon the satisfaction level of the customers.
Therefore a survey was conducted on the customers of SBI and ICICI bank using a
questionnaire. The questionnaire is a well-structured of 10 questions conducted on 30
customers of each bank. Questionnaire is on the study of the comparison of financial
performance of SBI and ICICI bank.
Name:
Occupation:
Address:
Sex :
Information Memorandum
SBI and ICICI Bank annual report 2007-12.