Project Report

ON

Comparative Study Of Financial Performance Of State Bank Of India

And Bank Of Baroda

Submitted in partial fulfillment of requirement of Bachelor of

Commerce (B.com)(Hons.)

BCOM(H),6th Semester
Batch 2014-2017

Submitted to: Submitted by:

Ms. Jasleen Kaur Abhijeet Ganguli

Assistant Professor 04314188814

JAGANNATH INTERNATIONAL MANAGEMENT SCHOOL, KALAKJI

1
 DECLARATION

I, Abhijeet Ganguli student of JIMS, Kalkaji, New Delhi 2014-17 Batch in BCOM
Honors, hereby declare that, this Project Report under the title Comparative
Study Of Financial Performance Of State Bank Of India And Bank Of Baroda is
the record of my original work. This report has never been submitted anywhere
else for award of any degree or diploma.

Abhijeet Ganguli

04314188814

2
 CERTIFICATION BY SUPERVISOR

I hereby certify that the student has completed the project under my guidance on
the title Comparative Study Of Financial Performance Of State Bank Of
India And Bank Of Baroda.

Ms. Jasleen Kaur Abhijeet Ganguli

04314188814

3
 ACKNOWLEDGEMENT

It is a great opportunity & pleasure for me to express my profound gratitude to all

the individuals who directly or indirectly contributed towards completion of this
report.

Working on this report was a great fun, excitement, challenges and a new
exposure in the field of finance. I am greatly in debated to under whose guidance
and concern I am able to bring the report into its real shape.

I am thankful to Ms. Jasleen Kaur and all faculty members of JIMS, Kalkaji in
providing me useful guidance for the completion of this report. I convey my
gratitude to all those who are directly or indirectly related in the completion of
this project report.

Abhijeet Ganguli

Roll No: 04314188814

Course: BCOM (Honors)

4
 PREFACE

In any organization, the two important financial statements are the Balance Sheet
and Profit & Loss Account of the business. Balance Sheet is a statement of
financial position of an enterprise at a particular point of time. Profit & Loss
account shows the net profit or net loss of a company for a specified period of
time. When these statements of the last few year of any organization are studied
and analyzed, significant conclusions may be arrived regarding the changes in
the financial position, the important policies followed and trends in profit and loss
etc. Analysis and interpretation of financial statement has now become an
important technique of credit appraisal. The investors, financial experts,
management executives and the bankers all analyze these statements. Though
the basic technique of appraisal remains the same in all the cases but the
approach and the emphasis in the analysis vary. A banker interprets the financial
statement so as to evaluate the financial soundness and stability, the liquidity
position and the profitability or the earning capacity of borrowing concern.
Analysis of financial statements is necessary because it helps in depicting the
financial position on the basis of past and current records. Analysis of financial
statements helps in making the future decisions and strategies. Therefore it is
very necessary for every organization whether it is a financial or manufacturing,
to make financial statement and to analyze it.

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 TABLE OF CONTENT

Chapter Page
Particulars
No. no.
1 Acknowledgement 4
2 Preface 5
3 Introduction of banking 7-18
4 Company Profile 19-59
State bank of India
Bank of Baroda
5 Research methodology 79-80
Financial Analysis 81-96
Ratio analysis
6 Financial comparative analysis 92-106
7 Conclusions 107
8 References 108

6
 INTRODUCTION OF BANKING

DEFINITION OF BANK

Banking Means "Accepting Deposits for the purpose of lending or Investment of

deposits of money from the public, repayable on demand or otherwise and
withdraw by cheque, draft or otherwise."

- Banking Companies (Regulation) Act,1949

ORIGIN OF THE WORD BANK:-

The origin of the word bank is shrouded in mystery. According to one view point
the Italian business house carrying on crude from of banking were called banchi
bancheri" According to another viewpoint banking is derived from German word
"Branck" which mean heap or mound. In England, the issue of paper money by
the government was referred to as a raising a bank.

ORIGIN OF BANKING :

Its origin in the simplest form can be traced to the origin of authentic history. After
recognizing the benefit of money as a medium of exchange, the importance of
banking was developed as it provides the safer place to store the money. This
safe place ultimately evolved in to financial institutions that accepts deposits and
make loans i.e., modern commercial banks.

Banking system in India

Without a sound and effective banking system in India it cannot have a healthy
economy. The banking system of India should not only be hassle free but it
should be able to meet new challenges posed by the technology and any other
external and internal factors.

For the past three decades India's banking system has several outstanding
achievements to its credit. The most striking is its extensive reach. It is no longer
confined to only metropolitans or cosmopolitans in India. In fact, Indian banking
system has reached even to the remote corners of the country. This is one of the
main reasons of India's growth process.

7
 HISTORY OF BANKING IN INDIA

Banking in India has its origin as early or Vedic period. It is believed that the
transitions from many lending to banking must have occurred even before Manu,
the great Hindu furriest, who has devoted a section of his work to deposit and
advances and laid down rules relating to the rate of interest. During the mogul
period, the indigenous banker played a very important role in lending money and
financing foreign trade and commerce.

During the days of the East India Company it was the turn of agency house to
carry on the banking business. The General Bank of India was the first joint stock
bank to be established in the year 1786. The other which followed was the Bank
of Hindustan and Bengal Bank. The Bank of Hindustan is reported to have
continued till 1906. While other two failed in the meantime. In the first half of the
19th century the East India Company established there banks, The bank of
Bengal in 1809, the Bank of Bombay in 1840 and the Bank of Bombay in1843.
These three banks also known as the Presidency banks were the independent
units and functioned well. These three banks were amalgamated in 1920 and
new bank, the Imperial Bank of India was established on 27th January, 1921.

With the passing of the State Bank of India Act in 1955 the undertaking of the
Imperial Bank of India was taken over by the newly constituted SBI. The Reserve
Bank of India (RBI) which is the Central bank was established in April, 1935 by
passing Reserve bank of India act 1935. The Central office of RBI is in Mumbai
and it controls all the other banks in the country.

In the wake of Swadeshi Movement, number of banks with the Indian

management were established in the country namely, Punjab National Bank Ltd.,
Bank of India Ltd., Bank of Baroda Ltd., Canara Bank. Ltd. on 19th July 1969, 14
major banks of the country were nationalized and on 15th April 1980, 6 more
commercial private sector banks were taken over by the government.

The first bank in India, though conservative, was established in 1786. From 1786
till today, the journey of Indian Banking System can be segregated into three
distinct phases. They areas mentioned below:

Early phase from 1786 to 1969 of Indian Banks

Nationalization of Indian Banks and up to 1991 prior to Indian banking

sector Reforms.

8
 New phase of Indian Banking System with the advent of Indian Financial &
Banking Sector Reforms after 1991.

Phase I

The General Bank of India was set up in the year 1786. Next came Bank of
Hindustan and Bengal Bank. The East India Company established Bank of
Bengal (1809), Bank of Bombay (1840) and Bank of Madras (1843) as
independent units and called it Presidency Banks.

These three banks were amalgamated in 1920 and Imperial Bank of India was
established which started as private shareholders banks, mostly Europeans
shareholders.

In 1865 Allahabad Bank was established and first time exclusively by Indians,
Punjab National Bank Ltd. was set up in 1894 with headquarters at Lahore.
Between 1906 and 1913, Bank of India, Central Bank of India, Bank of Baroda,
Canara Bank, Indian Bank, and Bank of Mysore were set up. Reserve Bank of
India came in 1935.

During the first phase the growth was very slow and banks also experienced
periodic failures between 1913 and 1948. There were approximately 1100 banks,
mostly small. To streamline the functioning and activities of commercial banks,
the Government of India came up with The Banking Companies Act, 1949 which
was later changed to Banking Regulation Act 1949 as per amending Act of 1965
(Act No. 23 of 1965). Reserve Bank of India was vested with extensive powers
for the supervision of banking in India as the Central Banking Authority.

During those days public has lesser confidence in the banks. As an aftermath
deposit mobilization was slow. Abreast of it the savings bank facility provided by
the Postal department was comparatively safer. Moreover, funds were largely
given to traders.

Phase II

Government took major steps in this Indian Banking Sector Reform after
independence. In1955, it nationalized Imperial Bank of India with extensive
banking facilities on a large scale especially in rural and semi-urban areas. It
formed State Bank of India to act as the principal agent of RBI and to handle
banking transactions of the Union and State Governments all over the country.

9
Seven banks forming subsidiary of State Bank of India was nationalized in 1960
on 19th July,1969, major process of nationalization was carried out. It was the
effort of the then Prime Minister of India, Mrs. Indira Gandhi. 14 major
commercial banks in the country was nationalized.

Second phase of nationalization Indian Banking Sector Reform was carried out in
1980 with seven more banks. This step brought 80% of the banking segment in
India under Government ownership.

The following are the steps taken by the Government of India to Regulate
Banking Institutions in the Country: 1949: Enactment of Banking
Regulation Act.
1955: Nationalization of State Bank of India.
1959: Nationalization of SBI subsidiaries.
1961: Insurance cover extended to deposits.
1969: Nationalization of 14 major banks.
1971: Creation of credit guarantee corporation.
1975: Creation of regional rural banks.
1980: Nationalization of seven banks with deposits over 200 crore.

After the nationalization of banks, the branches of the public sector bank India
rose to approximately 800% in deposits and advances took a huge jump by
11,000%.

Banking in the sunshine of Government ownership gave the public implicit faith
and immense confidence about the sustainability of these institutions.

Phase III

This phase has introduced many more products and facilities in the banking
sector in its reforms measure. In 1991, under the chairmanship of M
Narasimhama, a committee was set up by his name which worked for the
liberalization of banking practices. The country is flooded with foreign banks and
their ATM stations. Efforts are being put to give a satisfactory service to
customers. Phone banking and net banking is introduced. The entire system
became more convenient and swift. Time is given more importance than money.
The financial system of India has shown a great deal of resilience. It is sheltered
from any crisis triggered by any external macroeconomics shock as other East
Asian Countries suffered. This is all due to a flexible exchange rate regime, the
foreign reserves are high, the capital account is not yet fully convertible, and
banks and their customers have limited foreign exchange exposure.

10
 BANKS IN INDIA

In India the banks are being segregated in different groups. Each group has their
own benefits and limitations in operating in India. Each has their own dedicated
target market. Few of them only work in rural sector while others in both rural as
well as urban. Many even are only catering in cities. Some are of Indian origin
and some are foreign players.

All these details and many more is discussed over here. The banks and its
relation with the customers, their mode of operation, the names of banks under
different groups and other such useful informations are talked about.

One more section has been taken note of is the upcoming foreign banks in India.
The RBI has shown certain interest to involve more of foreign banks than the
existing one recently. This step has paved a way for few more foreign banks to
start business in India.

BANKING STRUCTURE IN INDIA

SCHEDULED BANKS IN INDIA

(1) Scheduled Commercial Banks

Public Sector Banks Private Sector Foreign Banks In Regional Rural

Banks India Banks

(26) (25) (29) (95)

Nationalized Old Private

Bank Banks
Other Public New Private
Sector Banks Banks
(IDBI)
SBI And Its
Associates

11
(2) Scheduled Cooperative Banks

Scheduled Urban Cooperative Scheduled State Cooperative Banks

Banks

Public Sector Banks

Public sector banks are those banks which are owned by the Government. The
Govt. runs these Banks. In India 14 banks were nationalized in 1969 & in 1980
another 6 banks were also nationalized. Therefore in 1980 the number of
nationalized bank 20. At present there are total 26 Public Sector Banks in India
(As on 26-09-2009). Of these 19 are nationalised banks, 6(STATE BANK OF
INDORE ALSO MERGED RECENTLY) belong to SBI & associates group and 1
bank (IDBI Bank) is classified as other public sector bank. Welfare is their
primary objective.

Nationalized banks Other Public SBI & its Associates

Sector Banks
Allahabad Bank State Bank of India
Andhra Bank IDBI (Industrial
Bank Of Baroda Development Bank
Bank Of India State Bank of
Of India)Ltd.
Bank Of Maharashtra Hyderabad
Canara Bank
Central Bank Of India
State Bank of Mysore
Corporation Bank
Dena Bank
Indian Bank State Bank of Patiala
Indian Overseas Bank
Oriental Bank Of
Commerce State Bank of
Punjab & Sind Bank Travancore
Punjab National Bank
Syndicate Bank
UCO Bank State Bank of Bikaner
Union Bank Of India And Jaipur
United Bank Of India (State Bank of Saurastra
Vijaya Bank merged with SBI in the year
2008 and State Bank of Indore
In 2010)

12
Private Sector Banks

These banks are owned and run by the private sector. Various banks in the
country such as ICICI Bank, HDFC Bank etc. An individual has control over there
banks in preparation to the share of the banks held by him.

Private banking in India was practiced since the beginning of banking system in
India. The first private bank in India to be set up in Private Sector Banks in India
was IndusInd Bank. It is one of the fastest growing Bank Private Sector Banks in
India. IDBI ranks the tenth largest development bank in the world as Private
Banks in India and has promoted world class institutions in India. The first Private
Bank in India to receive an in principle approval from the Reserve Bank of India
was Housing Development Finance Corporation Limited, to set up a bank in the
private sector banks in India as part of the RBI's liberalization of the Indian
Banking Industry. It was incorporated in August 1994 as HDFC Bank Limited with
registered office in Mumbai and commenced operations as Scheduled
Commercial Bank in January 1995. ING Vysya, yet another Private Bank of India
was incorporated in the year 1930

Private sector banks have been subdivided into following 2 categories:-

Old Private Sector Banks New Private Sector Banks

Bank of Rajasthan Ltd.

Catholic Syrian Bank Ltd.
City Union Bank Ltd. Bank of Punjab Ltd. (since
merged with Centurian Bank)
Dhanalakshmi Bank Ltd.
Centurian Bank of Punjab (since
Federal Bank Ltd.
merged with HDFC Bank)
ING Vysya Bank Ltd.
Development Credit Bank Ltd.
Jammu and Kashmir Bank Ltd.
HDFC Bank Ltd.
Karnataka Bank Ltd.
ICICI Bank Ltd.
Karur Vysya Bank Ltd.
IndusInd Bank Ltd.
Lakshmi Vilas Bank Ltd.
Kotak Mahindra Bank Ltd.
Nainital Bank Ltd.
Axis Bank (earlier UTI Bank)
Ratnakar Bank Ltd.
Yes Bank Ltd.
SBI Commercial and
International Bank Ltd.
South Indian Bank Ltd.
Tamilnad Mercantile Bank Ltd.
United Western Bank Ltd.

13
 Foreign Banks In India

ABN AMRO Bank N.V. HSBC (Hongkong & Shanghai

Abu Dhabi Commercial Banking Corporation)
Bank Ltd JPMorgan Chase Bank
American Express Bank Krung Thai Bank
Antwerp Diamond Bank Mashreq Bank
Arab Bangladesh Bank Mizuho Corporate Bank
Bank International Indonesia Oman International Bank
Bank of America Shinhan Bank
Bank of Bahrain & Kuwait Socit Gnrale
Bank of Ceylon Sonali Bank
Bank of Nova Scotia Standard Chartered Bank
Bank of Tokyo Mitsubishi UFJ State Bank of Mauritius
Barclays Bank
BNP Paribas
Calyon Bank
China Trust Commercial Bank
Citibank
DBS Bank
Deutsche Bank

Cooperative banks in India

The Cooperative bank is an important constituent of the Indian Financial System,

judging by the role assigned to co operative, the expectations the co operative is
supposed to fulfill, their number, and the number of offices the cooperative bank
operate. Though the co operative movement originated in the West, but the
importance of such banks have assumed in India is rarely paralleled anywhere
else in the world. The cooperative banks in India plays an important role even
today in rural financing. The businesses of cooperative bank in the urban areas
also has increased phenomenally in recent years due to the sharp increase in the
number of primary co-operative banks.
Co operative Banks in India are registered under the Co-operative Societies Act.
The cooperative bank is also regulated by the RBI. They are governed by the
Banking Regulations Act 1949 and Banking Laws (Co-operative Societies) Act,
1965.

14
Rural banks in India

Rural banking in India started since the establishment of banking sector in

India. Rural Banks in those days mainly focused upon the agro sector. Regional
rural banks in India penetrated every corner of the country and extended a
helping hand in the growth process of the country.

SBI has 30 Regional Rural Banks in India known as RRBs. The rural banks of
SBI is spread in 13 states extending from Kashmir to Karnataka and Himachal
Pradesh to North East. The total number of SBIs Regional Rural Banks in India
branches is 2349 (16%). Till date in rural banking in India, there are 14,475 rural
banks in the country of which 2126 (91%) are located in remote rural areas.

Apart from SBI, there are other few banks which functions for the development of
the rural areas in India.

Few of them are as follows.

Haryana State Cooperative Apex Bank Limited

The Haryana State Cooperative Apex Bank Ltd. commonly called as

HARCOBANK plays a vital role in rural banking in the economy of Haryana State
and has been providing aids and financing farmers, rural artisans, agricultural
laborers, entrepreneurs, etc. in the state and giving service to its depositors.

NABARD

National Bank for Agriculture and Rural Development (NABARD) is a

development bank in the sector of Regional Rural Banks in India. It provides and
regulates credit and gives service for the promotion and development of rural
sectors mainly agriculture, small scale industries, cottage and village industries,
handicrafts. It also finance rural crafts and other allied rural economic activities to
promote integrated rural development. It helps in securing rural prosperity and its
connected matters.

Sindhanur Urban Souharda Co-operative Bank

Sindhanur Urban Souharda Co-operative Bank, popularly known as SUCO

15
BANK is the first of its kind in rural banks of India. The impressive story of its
inception is interesting and inspiring for all the youth of this country.

United Bank of India

United Bank of India (UBI) also plays an important role in regional rural banks. It
has expanded its branch network in a big way to actively participate in the
developmental of the rural and semi-urban areas in conformity with the objectives
of nationalization.

Syndicate Bank

Syndicate Bank was firmly rooted in rural India as rural banking and have a clear
vision of future India by understanding the grassroots realities. Its progress has
been abreast of the phase of progressive banking in India especially in rural
banks.

Fact Files of Banks in India

The first Bank in India to be given an ISO certification. Canara Bank

The first Indian Bank to have been started solely with Indian capital. Punjab
National Bank

The first among the Private Sector Banks in Kerala to become South Indian
Scheduled Bank in 1946 under the RBI act. Bank

Indias oldest, largest and the most successful commercial bank State Bank of

16
offering the widest possible range of domestic, international and NRI India
products and services, through its vast network in India and overseas.

Indias second largest Private Sector Bank and is now the largest The Federal
scheduled commercial bank in India. Bank Limited

Bank which started as Private Shareholders Banks, mostly European Imperial Bank
shareholders. of India

The first Indian Bank to open a branch outside India in London in Bank of India,
1946 and the first to open a branch in continental Europe at Paris in
1974 founded in
1906 in
Mumbai.

The oldest Public Sector Bank in India having branches all over India Allahabad
and serving the customers for the last 132 years. Bank

INDIAN BANKING INDUSTRY

The Indian banking market is growing at an astonishing rate, with Assets

expected to reach US$1 trillion by 2010. An expanding economy, middleclass,
and technological innovations are all contributing to this growth.

The countrys middle class accounts for over 320 million People. In correlation
with the growth of the economy, rising income levels, increased standard of

17
living, and affordability of banking products are promising factors for continued
expansion.

The Indian banking Industry is in the middle of an IT revolution, Focusing on the

expansion of retail and rural banking. Players are becoming increasingly
customer -centric in their approach, which has resulted in innovative methods of
offering new banking products and services. Banks are now realizing the
importance of being a big player and are beginning to focus their attention on
mergers and acquisitions to take advantage of economies of scale and/or comply
with Basel II regulation.Indian banking industry assets are expected to reach
US$1 trillion by 2010 and are poised to receive a greater infusion of foreign
capital, says Prathima Rajan, analyst in Celent's banking group and author of
the report. The banking industry should focus on having a small number of large
players that can compete globally rather than having a large number of
fragmented players.

STATE BANK OF INDIA

State Bank of India
Industry :Banks - Public Sector
Incorporation Year 1955
Chairman Pratip Chaudhuri
Managing Director Hemant G Contractor

18
Company Secretary -
Auditor B M Chatrath & Co/ Kalyaniwala & Mistry
State Bank Bhavan 8th Floor,
Registered Office Madame Cama Road Nariman Point,
Mumbai, 400021, Maharashtra
Telephone 91-22-22883888/22022678
Fax 91-22-22855348
E-mail gm.snb@sbi.co.in
Website http://www.sbi.co.in
Face Value (Rs) 10
BSE Code 500112
BSE Group A
NSE Code SBIN
Bloomberg SBIN IN
Reuters SBI.BO
ISIN Demat INE062A01012
Market Lot 1
Ahmedabad,Chennai,Delhi,Kolkata,London,Mumbai,
Listing
NSE
Financial Year End 03
Book Closure Month May
AGM Month Jun
Datamatics Financial Services, PlotNo-A-16-17 Part
B, Cross Lane MIDC, Marol Andheri (East),
Registrar's Name &
Mumbai - 400 093.
Address
91-22-28213383/90/66
91-22-28369408

It is the largest Indian banking and financial services company (by turnover and
total assets) with its headquarters in Mumbai, India. It is state-owned. The bank
traces its ancestry to British India, through the Imperial Bank of India, to the
founding in 1806 of the Bank of Calcutta, making it the oldest commercial bank in
the Indian Subcontinent. Bank of Madras merged into the other two presidency
banks, Bank of Calcutta and Bank of Bombay to form Imperial Bank of India,
which in turn became State Bank of India. The government of India nationalized
the Imperial Bank of India in 1955, with the Reserve Bank of India taking a 60%

19
stake, and renamed it the State Bank of India. In 2008, the government took over
the stake held by the Reserve Bank of India.

SBI provides a range of banking products through its vast network of branches in
India and overseas, including products aimed at non-resident Indians (NRIs). The
State Bank Group, with over 16,000 branches, has the largest banking branch
network in India. SBI has 14 Local Head Offices and 57 Zonal Offices that are
located at important cities throughout the country. It also has around 130
branches overseas.

With an asset base of $352 billion and $285 billion in deposits, SBI is a regional
banking behemoth and is one of the largest financial institutions in the world. It
has a market share among Indian commercial banks of about 20% in deposits
and loans. T The State Bank of India is the 29th most reputed company in the
world according to Forbes. Also SBI is the only bank featured in the coveted "top
10 brands of India" list in an annual survey conducted by Brand Finance and The
Economic Times in 2010. The State Bank of India is the largest of the Big Four
banks of India, along with ICICI Bank, Punjab National Bank and HDFC Bank
its main competitors.

History of state bank of India:

State Bank of India is the largest state-owned banking and financial services
company in India. The Bank provides banking services to the customer. In
addition to the banking services, the Bank through their subsidiaries, provides a
range of financial services, which include life insurance, merchant banking,
mutual funds, credit card, factoring, security trading, pension fund management
and primary dealership in the money market.
The Bank operates in four business segments, namely Treasury, Corporate/
Wholesale Banking, Retail Banking and Other Banking Business. The Treasury
segment includes the investment portfolio and trading in foreign exchange
contracts and derivative contracts. The Corporate/ Wholesale Banking segment
comprises the lending activities of Corporate Accounts Group, Mid Corporate
Accounts Group and Stressed Assets Management Group. The Retail Banking
segment consists of branches in National Banking Group, which primarily
includes personal banking activities, including lending activities to corporate
customers having banking relations with branches in the National Banking
Group.
SBI provides a range of banking products through their vast network of branches
in India and overseas, including products aimed at NRIs. The State Bank Group,
with over 16,000 branches, has the largest banking branch network in India. The
State bank of India is the 10th most reputed company in the world according to
Forbes. The bank has 156 overseas offices spread over 32 countries. They have
branches of the parent in Colombo, Dhaka, Frankfurt, Hong Kong,
Johannesburg, London and environs, Los Angeles, Male in the Maldives,
Muscat, New York, Osaka, Sydney, and Tokyo. They have offshore banking units

20
in the Bahamas, Bahrain, and Singapore, and representative offices in Bhutan
and Cape Town.
State Bank of India was incorporated in the year 1955. The Bank traces their
ancestry to British India, through the Imperial Bank of India, to the founding in
1806 of the Bank of Calcutta, making them the oldest commercial bank in the
Indian Sub-continent. The Government of India nationalized the Imperial Bank of
India in the year 1955, with the Reserve Bank of India taking a 60% stake, and
name was changed to State Bank of India.
In the year 2001, the SBI Life Insurance Company was started by the Bank.
They are the only Bank that have been permitted 74% stake in the insurance
business. The Bank's insurance subsidiary 'SBI Life Insurance Company' is a
joint venture with Cardiff S.A in which Cardiff holds 26% of the stake.
During the year 2005-06, the bank introduced 'SBI e-tax' an online tax payments
facility for direct and indirect tax payment. They also launched the centralized
pension processing. The Bank made a partnership with Tata Consultancy
Services for setup C-Edg Technologies and consulting services to the banking,
financial services and insurance industry. The bank was noted as 'The most
preferred bank' in a survey by TV 18 in association with AC Nielsen-ORG Marg.
Also, the Bank was voted as 'The most preferred housing loan provider' in
AWAAZ consumer awards for the year 2006.
In the customer loyalty survey 2006-07 conducted by 'Business World', the Bank
was ranked number one in all parameters of customer satisfaction, service
orientation, customer care/ call center, customer loyalty and home loans. SBI
Funds was judged 'Mutual fund of the year' by CNBC/TV-18/CRISL. The Bank
introduced new products and services such as web-based remittance, instant
fund transfer, online-trading and comprehensive cash management.
During the year 2007-08, the Bank launched 965 branches all over the country.
They inaugurated a new state-of-the art Dealing Room with online connectivity to
all active forex intensive Branches at Corporate Centre in Mumbai. They
launched a new product, Construction Equipment Loan to cater to construction
Companies. Also, they introduced new products such as SBI Reverse Mortgage
Loan and SBI Home Plus in the areas of Home Loans.
During the year, the RBI transferred their entire shareholding in the Bank
representing 59.73% of the issued capital of the Bank to the Government of
India. The Bank acquired 92.03% of equity of Global Trade Finance Ltd.
Consequently, GTFL became a subsidiary of the Bank. They signed an MoU with
the Indian railways for installing ATMs at 682 railway stations. In March 2008, the
Bank opened their 10,000th branch and became only the second bank in the
world to have more than 10,000 branches after China's ICBC. During the year
2008-09, the company launched Import factoring, a new product in association
with SBI Factors & Commercial Services Ltd. They increased the number of
branches for retail sale of gold coins from 250 to 518. Also, they re-launched
Gold Deposit Scheme at 50 branches to mobilize gold from domestic market for
deployment as metal loans to jewelers.

During the year, the Bank opened their 11,111th Branch at Sonapur (Kamrup

21
District) in Assam. They introduced three new products viz., SBI Special Home
Loan, SBI Happy Home Loan and SBI Lifestyle in response to the stimulus
package announced by the Government of India. Also, they entered into an
exclusive arrangement with TATA Motors for handling the booking process of
TATA 'Nano' cars. During the year, the Bank launched on their web-site an on-
line application form for registering Auto Loan enquiries and expeditiously
monitoring and converting these leads into Auto Loans. Also, they launched 'e-
invest' for the ASBA (applications supported by blocked accounts) to aid
investors for their equity subscriptions, IPO and Rights applications.
During the year, the Bank set up a custodial services company namely SBI
Custodial Services Pvt. Ltd., in joint venture with Societe Generale, France. They
signed letter of intent for setting up of joint venture company for undertaking
General Insurance Business. Also, they divested 10% equity stake in its wholly
owned subsidiary SBI Pension Fund Pvt. Ltd at cost in favour of its subsidiaries.
In October 2008, the Bank signed an MoU with State General Reserve Fund
(SGRF) of Oman, for a general purpose private equity fund.
During the year, State Bank of Saurashtra (SBS), a wholly owned subsidiary of
the Bank, amalgamated with the Bank with effect from August 13, 2008. They
signed a joint venture agreement with Insurance Australia Group for undertaking
General Insurance business. Also, they signed a joint venture agreement with
Macquarie Capital Group, Australia and IFC, Washington for setting up an
Infrastructure fund of USD 3 billion for investing in various infrastructure projects
in India.
During the year 2009-10, the Bank opened 1,049 branches, out of which
branches were opened in metro and urban areas with a view to increase the
Bank's reach and be more accessible to customers. In July 2009, SBI introduced
'SBI Loan to Affluent Pensioners' enabling the government pensioners to avail
personal loans upto Rs 3 lakh.
During the year, the Bank designed a special package, the Defence Salary
Package, for personnel of the three Armed Forces i.e. the Army, Navy and Air
Force who maintain their Salary accounts with them. As of March 2010, the Bank
had 12,496 branches and 21,485 Group ATMs. In June 2009, the company
increased their shareholding in Nepal SBI Bank Ltd to 55.02% and thus Nepal
SBI Bank Ltd became a subsidiary of the Bank with effect from June 14, 2009.
In May

2010, the Bank selected consortium of Elavon Incorporation, USA and Visa
International, USA as their joint venture (JV) partner for Merchant Acquiring
Business. They set up a wholly owned subsidiary, namely SBI Payment Services
Pvt Ltd for conducting Merchant Acquiring Business.
In August 2010, State Bank of Indore was amalgamated with the Bank as per
the scheme of amalgamation approved by the Central Board.
During the year 2010-11, the Bank introduced 2 new products, namely 'Pushpa
Ullas' and 'Arthias Plus' on pilot basis. They made substantial progress in
establishing itself as a leading PE fund player of the country. Also, they also
signed a Joint Venture agreement with State General Reserve Fund (SGRF) of

22
Sultanate of Oman, a sovereign entity, to set up a general purpose private equity
fund with an initial corpus of USD 100 mn, expandable further to USD 1.5 bn.
During the year, the Bank opened 576 new branches besides merger of 470
branches of erstwhile State Bank of Indore. Also, they opened 14 foreign offices
during the year, taking the total to 156. In July 1, 2010, the Bank launched their
'Green Channel Counter' at select branches across the country.
In General Insurance business, the Bank launched limited operations in April
2010 for the Corporate and Mid Corporate customers based at Mumbai, and it
was expanded to six other major locations in July 2010. In the Retail segment,
the Bank launched their Long Term Home Insurance business at Mumbai in
October 2010, which was gradually extended to cover 56 RACPCs and
RASMECCs. General Insurance SME business was launched on a pilot basis in
Mumbai and Chennai in February 2011. During the first quarter of the financial
year 2011-12, the Government of India issued the 'Acquisition of State Bank of
India Commercial & International Bank Ltd. vide notification dated July 29, 2011.
Consequent to the said notification, the undertaking of State Bank of India
Commercial & International stands transferred to and vest in State Bank of India
with effect from July 29, 2011.

MILESTONE OF STATE BANK OF INDIA

1955 -
On 1st July State Bank of India was constituted under the State Bank
Of India Act 1955, for the purpose of taking over the undertaking and
business of the Imperial Bank of India. The Imperial Bank of India
was founded in 1921 under the Imperial Bank of India Act 1920. The Bank
transacts general banking business of every description including,
foreign exchange, merchant banking and mutual funds
1959 -
On September State Bank of India (Subsidiary Bank) Act was passed.
On October State Bank of Hyderabad become the first subsidiary of SBI.
1960 -
During this period, State Bank of Jaipur, State Bank of Bikaner,
State Bank of Indore, State Bank of Travancore, State Bank of Mysore,
State Bank Patiala and State Bank of Saurashtra became subsidiaries of the
bank.

1962 -
The Bhor State Bank Ltd was Amalgamated with the Bank bring the
Total number of minor State associated banks so amalgamated to five. A scheme for
amalgamation of the Bank of Aundh Ltd., was also approved.
On 20th August, the Unit Bank Ltd. Chennai was taken over by the Bank.
1963 -
In October Branch in London become bankers to the Indian High Commission, thereby
taking over a function till then performed by the office of RBI. Of the other business

23
 transacted by the Branch, an important aspect was medium term loans mostly to Indian
shipping companies.
1969 -
On November 8th the Bank of Behar Ltd was amalgamated.
1972 -
A merchant banking division was set up in the central office to cater to promotional needs
of the corporate sector.
1977
During the year bank introduced the Perennial Pension Plan Scheme
Under which if the depositors make a regular monthly payment of a fixed
amount for a period of 84 to 132 months, they become eligible from
the 86th and 134th months respectively for getting a monthly pension of predetermined
amount forever.
In order to meet all the developmental needs of the villages
Including their social and cultural needs, the bank launched an integrated
Rural development programme, aimed at not only covering the credit needs
of agriculture and agricultural activities and village industries, but
also housing and social activities.
1980 -
Bank introduced the cash Certificate Scheme under which deposit
certificate are issued for a fixed period on payment of the issue price
specified for the respective maturity period and the face value
corresponding to the issue price plus interest compounded at
quarterly intervals is paid on maturity. The certificates are issued for the
face value of Rs 100, Rs 1000, Rs 10,000 and Rs 50,000 maturing
after 29,65,84 and 120 months.
1982 -
The Non-Resident Investment Cell was set up, which had streamlined
The working operations of the non-resident investment sections at
Important centers.
1983 -
SBI launched self employment scheme, for providing self-employment
To educated unemployed youth. Educated unemployed youths are
Encouraged to undertake self-employment ventures in industry, services and
business.
1984 -
The bank provide need-based rehabitation assistance to large and
medium sick industrial units.
1985 -
During the year, company set up a data bank of sick units available
for taken over by healthy units. With effect from 26th August, the Bank of Cochin Ltd
with 108 branches was also amalgamated with the Bank.
(i) All shares in the Capital of the Imperial Bank of India was
vested in the RBI. The SBI was registered with an Authorized capital of
Rs.20 crores, and an issued and paid up capital of Rs.562,50,000 divided
into 562,500 shares of Rs.100 each.

24
 (ii) Every person who on the 30th June, 1955, was registered as a
holder of shares in the Imperial Bank of India was paid by the
Reserve Bank of India.
44,37,500 No. of shares issued at a premium of Rs 160 per share.
1986 -
At the end of the year 324 sick units with an outstanding of Rs 1069
crores were assisted. Of these, 107 units were considered viable and
60 from them were placed under regular nursing programme.
On 1st August a new subsidiary named SBI Capital Market was
functioning independently, took up leasing business and certain other new
services.
100,00,00 No. of shares issued at a prem. of Rs 160 per share.
1987 -
Up to the end of the year the bank had sponsored 30 Regional Rural
Banks covering 66 backward and underbanked districts in the country.
In terms of deployment, the advances portfolio of overseas offices
rose to Rs 5,767 crores. Investments in inter-bank money markets and
also in prime securities amounted to Rs 2,670 crores by the end of the
year.
1988 -
During the year bank initiated UPTECH an Industrial Technology Group
to direct and guide programmes aimed at facilitating technology
upgradation.
Also a scheme to develop entrepreneurship among woman under the name
Stree Shakti was launched. Several concessions in respect of margin
and rate of interest have been built into the package. Three
pilot programmes were launched at Chennai, Calcutta, and Hyderabad.
On 20th September, the bank inaugurated `SBINET,' an integrated
communication project aimed at improving customer service,
operational efficiency and administrative convenience. The network has been
designed to handle voice, fax data and manages through the trunk
routes and exchanges in important centers.
The bank sponsored 30 RRB's covering 66 divisions in the country.
branches were opened raising the branch network to 2,306.
1989 -
SBICAP, in their capacity as Trustee and Manager of Mutual Fund,
launched two scheme viz., Magnum Monthly Income Scheme 1989 and
Magnum Tax Service Scheme 1990.
During the same period SBI in association with Morgan Stanley Asset
Management Inc. of USA, launched the India Magnum Fund.
1990 -
New products launched during the year included a Regular Income
Scheme, offering an assured return in excess of 12% and the first Pure
Growth Scheme aimed at capital appreciation. A Second offshore fund of US
$ 12 million called Asian Convertible and Indian Fund was launched in
association with Asian Development Bank, Manila.

25
During Kharif 1990, the bank introduced an agricultural credit card,
known as SBI Green Card to give greater liquidity and flexibility to
farmers in procuring agricultural inputs. The scheme was introduced
on a pilot basis in 125 intensive centre branches.
As at on 31st March, SBIMF had over 3,40,000 Indian investors and
about Rs 475 crores by way of investible domestic funds.
50,00,000 No. of shares issued at a prem. of Rs 160 per share.
1991 -
During February the bank set up a new subsidiary called the SBI
Factors and Commercial Serviced Pvt. Ltd. for rendering factoring services
to the industrial and commercial units in Western India.
1992 -
The bank sponsored 30 RRBs with a network of 3189 offices covering
102 backward and under banked districts of the country. A sum of Rs
15.25 crores was contributed towards the share capital of the RRBs.
During the period bank introduced `Stockinvest' scheme. Also
introduced a `Gyan Jyoti' that replaced earlier education loan schemes and
offers substantial augmented assistance to students pursuing higher
studies.
Moreover dedicated NRI branches equipped with State-of-the-art
technology was set up at Mumbai and Delhi to cater to the special
needs of NRI residents.
1993 -
During the year as a part of its overseas expansion the bank
established representative office in Tashkent.
During December, the bank issued 124,000,000 equity shares of Rs.10
each for cash at a premium of 90 per share of which 245,00,000
shares each were reserved for allotment on a preferential basis to Indian
Financial Institutions and Indian Mutual Funds. Balance issued to
the public.
Simultaneously it came out with another issue of 50,00,000 12%
unsecured redeemable floating rate bonds in the nature of promissory
notes of the face value of 1000 each. Oversubscription upon a
further amount of Rs 500 crores (in all Rs 1000 crores) was to be allowed.
The face value of each bond would be redeemed at par at the expiry of 10
years from the date of allotment. In the event that the State Bank
decides to exercise its option to call up the bonds they would be
redeemed at the rate of 5% at the end of 5th year, at 3% at the end
of7th year and 1% at the end of 9th year.
It was proposed to issue 1200,00,000 right equity shares of Rs.10
each at a premium of Rs.50 per share in the proportion of 3:5. Also
another120,00,000 equity shares of Rs.10 each were to be issued at a
premium of Rs.50 per share to employees on an equitable basis.
250 sick units with the bank were referred to the BIFR including 31
public sector units. Approved rehabilitation packages being
implemented in 85 units and 41 have been recommended to be wound up.

26
The bank continued to be appointed as the operating agency and
rehabilitation packages were submitted to BIFR in 48 cases.
Equity shares subdivided. 1418,50,000 No. of Equity Shares of Rs.
10each issued at a prem. of Rs 90 per share to the public. Another
1319,78,726 shares of Rs 10 each offered at a prem. of Rs 90 per
share on Rights basis and to employees.
1994 -
358 sick units with the bank were referred to the BIFR including 55
public sector units. Approved rehabilitation packages implemented
in87 units.
1,80,463 No. of Shares kept in abeyance were issued.
1995 -
351 sick units with the bank were referred to the BIFR including 66
public sector units. Approved rehabilitation packages implemented
in112 units.
683 No. of shares kept in abeyance were allotted.
1996 -
On 3rd October the Bank Issued 261,45,000 GDRs amounting to
5,22,90,000equity shares. 1 GDR is issued to 2 equity shares. The issue price
of GDR was US $ 14.15 per GDR.
1997 -
Shares issued to employees of the bank bearing distinctive numbers
46,26,00,001 to 47,46,00,000 will not be good delivery. The rights
issue was for 12 crore equity shares at a premium of Rs.50
aggregatingRs.720 crore in addition to a further issue of 1.2 crore equity
shares of Rs.10 at a premium of Rs.50 aggregating Rs.72 crore for State
Bank employees. The price of the rights had been Rs.60 per share.
After SBI Capital Markets, Manila-based Asian Development bank will
pick up 15 per cent equity stake in the new stock broking subsidiary
of State Bank of India to be made operational by mid-1997. The balance
85per cent will be subscribed to by SBI.
SBI Securities Ltd the 100 per cent stock broking subsidiary of SBI,
has recently received the much-awaited letter of incorporation from the
Registrar of Companies. Following this, both SBI and ADB will pick
up their respective shares in the new stock broking firm. SSL will have
an equity base of Rs.50 crore.
The State Bank of India has tied up with GE Capital to float a
venture in Mumbai. State Bank signed the memorandum of understanding with
GE Caps in March.
State Bank will tie up with either VISA or MasterCard or even both
for the franchise network. GE Caps through this joint venture will be
imparting technology, credit card expertise and payment card
mechanism.
The Reserve bank of India has directed the SBI to set up a 0
million stand-by facility for the Indian oil corporation.
State Bank of India (SBI) signed an agreement with the National

27
Securities Depository Ltd (NSDL) for dematerialization of its
shares.
Besides, SBI has also become an equity stake holder in NSDL to the
extent of 4.76%.
SBI Commercial and International Bank, has become the country's
first public sector bank to introduce optical disk (OD) facilities for
data storage.
1998 -
State Bank of India will kick-start its credit card business on July
1by floating two joint ventures with GE Capital. The largest
financial intermediary in the country will sign the joint venture agreement
with GE Caps in the last week of January.
The State Bank of India on Jan 27 kicked off its foray into the
payment cards business with a joint venture agreement with US-based
Financial services giant, General Electric Capital Corporation (GE Capital).
State Bank of India (SBI) on June 24 signed an exclusive agreement
with the world's largest payment system - Visa International - for
Payment cards in India. The agreement was signed in Mumbai between the SBI
managing director, Mr. O P Sethia, and the general manager and
executive vice president (South East Asia) of Visa, Mr. James G Murray.
1999 -
State Bank of India (SBI) has bagged the mandate to syndicate the $
120million loan for the National Thermal Power Corporation (NTPC).
The State Bank of India (SBI) proposes to take up the life insurance
and general insurance business once the sector is opened up.
State Bank of India has tied up with its associate banks to market
the SBI Card. The SBI has tied up with State Bank of Patiala in
Chandigarh and State Bank of Mysore in Bangalore to help market its credit
card.
SBI proposes to introduce a value-added service for cardholders
whereby the credit card can also be used as an ATM card.
The State Bank of India will tie up with international investment
banker Credit Suisse First Boston and three domestic public sector
banks to form a gold assaying venture.
The State Bank of India (SBI) has decided to take over SBI Home
Finance(SBIHF), with its assets and liabilities. Having the largest stake,
SBI has been weighing various options for bailing out the joint
venture company which has slipped into huge losses.
The State Bank of India (SBI) has signed up with Central Depository
Services (I) (CDSIL) for the dematerialization of its shares.
SBI shares have already been admitted as security with National
Securities Depository (NSDL). Besides, SBI also has a stake (Rs 10
cr) in the equity of CSDL.
According to an agreement entered into with the development bank,
State Bank of India (SBI) was to reduce its stake in its investment
banking subsidiary to below 50 per cent by March 31.

28
 The State Bank of India (SBI) has entered into an agreement with
Moody's Investor Service and Icra, under which SBI will pick up
Moody's11 per cent stake in Icra in case the global rating firm wants to
get out of its investment in India.
State Bank of India (SBI) has taken the lead in `convenience
banking by becoming the first public sector bank to offer its `savings bank'
account holders the benefits of fixed deposits (higher interest
rates)and current accounts (overdraft facility).
2000 -
The Bank has embarked upon the expansion of its ATM network in the
twin cities of Hyderabad and Secunderfabad.
The Bank has become the first government owned financial institution
to join the rank of companies declaring interim dividend.
The Bank has proposed to come out with an issue under private
placement of unsecured, non-convertible, subordinated bonds in the nature of
promissory notes of Rs 1 lakh each aggregating Rs 600 crores with an
option to retain oversubscription of up to Rs 40 crores.
The Bank launched the Metal (Gold) Loan Scheme in Coimbatore. This
is the third scheme to be introduced by SBI.
SBI is also forming a subsidiary - SBI Gold and Precious Metals Pvt.
Ltd. with 50 per cent equity participation.
Mr. Vepa Kamesam, Deputy Managing Director, has been appointed as
Managing Director with effect from 1st June.
SBI board cleared the setting up of a separate subsidiary for information technology.
KC Raut has recently taken charge as general manager at State Bank
of India, Chennai.
The Bank has become the first public sector bank to offer fixed-rate home loans.
The State Bank of India has tied up with State Bank of Mysore to launch
co-branded credit cards as part its strategy to collaborate with associate banks to
expand its cardholder base.
Central Depository Services (India) Ltd has signed an agreement with
State Bank of India as its Depository participant.
State Bank of India and the Exim Bank of the US have signed a memorandum
of understanding, involving 0 million, to support the small and
medium-sized Indian companies to purchase US goods and services.
Mr. Suresh Kumar Mehra, Workmen Directors, ceased to be a member of
the Central Board of the bank effect from October 1, due to his
retirement at the close of the business on September 30.
The Bank has launched an international credit cards for doctors, the first of its kind in the count
offering facilities including special discounts on medical equipment and personal
loans from GE countrywide.
The State Bank of India has introduced a new scheme to boost exports.
The CRISIL has assigned a triple-A (AAA) rating to the State Bank of
India's Rs 3,000 crore bonds programme.
The Bank have decided to close down its fully-owned foreign subsidiary
- SBI European Bank Ltd., in London.

29
 Mr. S. Mukerji, Managing Director, of the bank retired from the bank on 30th of November.
State Bank of India Mutual Fund has launched the Magnum Gilt Fund, dedicated to
investing in government securities.
2001 -
The Bank has signed an MoU with Cardiff S.A. for the bank's life insurance business.
The Bank has introduced Voluntary Retirement Scheme for eligible
employees, open from the 15th January 2001 to the 31st January 2001.
The Bank has incorporated a subsidiary `SBI Life Insurance CompanyLtd.,' for doing life insura
business. The Bank will install 10 more Automated Teller Machines in the
north-eastern region in addition to the one already commissioned at Guwahati.
State Bank of India launched three more ATMs i n Bangalore.
Mr. Y Radhakrishnan has been promoted to the post of managing director
of State Bank of India. SBI Cards has set up a special insurance cell in Ahmedabad for
facilitating the claims of SBI cardholders affected by the tragic earthquake in Gujarat.
SBI has assigned the Delhi-based HCL Com Net to provide it ATM
inter-connectivity which could involve investments running into
several hundred crores.
SBI chief general manager Madhav M Mehta, who is currently the operational head in
Gujarat, has been transferred to its corporate office in Mumbai as chief general manager
(CGM).
July 3- Announces the launch of the SBI International card and the SBI
Global Card for global travelers in India. SBI International cards and
SBI Gold Cards would be accepted at over 20 million Visa outlets worldwide and one lakh
outlets in India. State Bank of India has embarked upon an ambitious Rs 800-crore
technology upgradation programme. The bank has appointed KPMG, a consultant in
computer technology, to provide inter connectivity networking to the computerized branches
and also to the ATMs across the country enabling its customers to transact any kind of
business from anywhere.
State Bank of India was presented the award for JD Power AsiaPacifics2001 India Sales Satis
Index (SSI) and Consumer Financing Satisfaction (CFS)
State Bank of India has added three more ATMs to its network. The new ATMs were
installed at SBI's Andheri (west),Goregaon (east),and Borivili (east) branches on September
22. State Bank Of India (SBI) has informed BSE that Shri K.J.Udeshi, ED,RBI has been
nominated on the Central Board of the Bank as nominee of RBI in place of Dr.Y.V.Reddy,
w.e.f. September 22, 2001 under Sec.19(f)of SBI Act.
State Bank of India has slashed the interest rate on home loans by 0.5per cent to 12 per cent
effective from September 15.
IN A significant move, the State Bank of India has decided to distance itself from its
subsidiaries - SBI Capital Markets, SBI Gilts, SBIAMC and State Bank of Credit and
Commerce International. They will have the autonomy, independent chairmen and externa
executives at the senior management level at market-related salaries. At present, the
SBI chairman is the ex-officio chairperson of all the subsidiaries, including the associate
banks.
The new scheme will be aimed only at the award staff, a category that was included with
officers in the January 2001 voluntary retirement scheme.
SBI Cards on July 3, announced the launch of the SBI International card and the SBI Global

30
Card for global travelers in India.
- VRS implemented in which around 21,000 employees, including officers, were permitted
to retire
- The Bank has crossed another milestone by making a successful foray
into insurance. SBI is the only Bank to have been permitted a 74%
stake
in the insurance business. The Bank's insurance subsidiary, SBI Life
Insurance Company, a joint venture with the Bank holding 74% and
Cardiff S.A., the Joint venture partner, the balance 26%, was incorporated to
undertake life insurance and pension business. Cardiff S.A. is a
wholly-owned subsidiary of BNP-Paribas, which is the largest bank in
France and one of the top ten banks in the world. Cardiff S.A. is the
largest bank assurance company in France.

- The bank's efforts to establish a world -class credit information

bureau in India culminated in the successful setting up of the
Credit
Information Bureau (India) Ltd., a joint venture of the Bank with
HDFC
Ltd., Dun and Bradstreet Information Services India Pvt. Ltd. and
Trans Union International Inc.

2002

- In order to reduce risk and develop a transparent and active debt

market in general and government securities market in particular,
the Clearing Corporation of India Ltd. has been set up in Mumbai with the Bank as the chief
promoter.
-E K Thakur resigns from Directorship of SBI.
-TCS bags order of Rs 500 crore from SBI.
-SBI has informed that the following change in Directors. 1. Shri A C Kalita, Director on the
Bank's
Central Board ceased to be a Director on the Board w.e.f May 13, 2002 on expiry of his term
on May 12,
2002.2. Shri Y Radhakrishnan Managing Director & GE (CB) has relinquished office of the
Managing
Director as on June 30, 2002 and ceased to be Director on the Board w.e.f July 01, 2002.

-State Bank of India has informed BSE that Mr. D C Gupta IAS Secretary
(Financial Sector), Ministry of Finance, Department of Economic
Affairs, New Delhi has been nominated as Director on the Board of
State Bank of India with effect from July 17, 2002 vice Mr. S K Purkayastha.

-State Bank of India has informed BSE that Mr. S Govindarajan,

Managing Director & GE (NB) has relinquished office of the Managing
Director as on July 31, 2002 and ceased to be Director on the Board w

31
 e f August 01, 2002.Further Mr. P R Khanna, Director on the Bank's
Central Board ceased to be a Director on the Board w e f August 20, 2002 consequent upon hi
resignation.

-State Bank of India has informed BSE that the Bank has decided to
close SBI Securities Ltd (SBISL), a subsidiary of the Bank, following
a Directive in this regard from the RBI.

-State Bank of India has informed that the Central Government

appointed Mr. A K Batra, Deputy Managing Director, State Bank of India
as Managing Director, State Bank of India for the period from the date
of his taking charge and upto August 31, 2003. Also, Mr. P N
Venkatachalam, Deputy Managing Director, State Bank of India, has
been appointed as Managing Director, State Bank of India for the
period from the date of his taking charge and upto March 31, 2004.

-State Bank Of India has informed that Shri Prithvi Raj Khanna and
Shri Kumar Bery have been duly elected as Directors under Section
19(c) of SBI Act at the General Meeting of the -State Bank of India
has informed that it has appointed Mr. Ananta Chandra Kalita, as a
Director on the Central Board of the Bank from amongst the employees
of the Bank, who are workmen, for a period not exceeding six months
commencing from October 03, 2002 or until his successor is appointed
or till he ceases to be workmen employee of State Bank of India, or
until further orders, whichever event occurs earlier. Shareholders of
the bank held on September 09, 2002.

-State Bank of India has informed BSE that Shri Janki Ballabh,
Chairman has relinquished office of Chairman at the close of business
hours on his attaining superannuation on October 31, 2002.

-State Bank of India has informed that Smt. Vineeta Rai, Secretary
(Banking & Insurance), Ministry of Finance and Company Affairs,
Department of Economic Affairs (Banking Division), New Delhi has been
nominated as Director of the Board with effect from October 30, 2002.

-State Bank of India has informed that the Central Government, after
consultation with the Reserve Bank of India, appointed Shri A K
Purwar, Deputy Managing Director, State Bank as Chairman, State Bank
of India from the date of his taking charge of the post and upto May
31, 2003 i.e. date of his superannuation or until further orders
whichever is earlier. Shri A K Purwar assumed the charge of Chairman,
State Bank of India, on November 13, 2002.

2003
- State Bank of India (SBI) and Maruti Udyog Ltd have announced a

32
joint initiative aimed at making car finance affordable to middle and
lower middle class customers. Customers will now have transparent car
finance involving no hidden charges and pre-closure penalties, and
also get the dealers' margins, Mr. S.K. Bhattacharya, Chief General
Manager, SBI, told newspersons. It will help both the bank and Maruti
to aggressively tap the Andhra Pradesh market, he said. SBI offers
finance facility even for lifetime tax, insurance and accessories of
the vehicle.

- State Bank of India has informed that the Bank has appointed Shri
Ananta Chandra Kalita, Head Assistant, State Bank of India as a
Director on the Central Board of the Bank amongst the employees of
the Bank, who are workmen for a period of 3 years commencing from
July 15, 2003 or until he ceases to be a workmen employee of the Bank
or until further orders, whichever is earlier provided that he shall
not hold the office continously for a period exceeding six year.

- SBI group's total profit identified at Rs 3,354 cr in '02

- Mr. D C Gupta nominated as Director on the Board of SBI

- SBI introduces IT upgradation plan with KPMG help

- SBI Cards and Payment Services Private Ltd, the credit card
subsidiary of the State Bank of India, introduces two new schemes
recently- SBI Advantage Card to the bank's fixed deposit customers
and SBI International Card for its home loan borrowers

- Launches a new credit appraisal system targeting the small and

medium enterprises (SME) for loans up to Rs 25 lakh

- SBI selects TCS to execute trade finance solution

- SBI and ICICI Bank among the top 100 banks in Asia in 2001 as per
the study by Asian Banker Journal

- Introduces SBI Cash Plus, its Maestro Debit Card that allows
customers to access their deposit accounts from ATMs and merchant
establishments

2003

- Promotes three Chief General Managers (CGM) to the posts of Deputy

Managing Directors (DMDs). They are: A D Kalmankar, CGM in charge of
Staff College of Hyderabad, A K Das, CGM, Hyderabad; and R K Sinha,
CGM, Chandigarh

33
- SBI appoints Mr. S K Bhattacharya as the new Chief General Manager
for Hyderabad circle

- Increases its equity stake in Discount and Finance House of India

Ltd (DFHIL) to 51%

- Ties up with Maruti Udyog Ltd. (MUL) for car finance

- Receives permission from Insurance Regulatory and Development

Authority (IRDA) to sell healthcare products to individuals

- Increases its Equity Stake in DFHIL to 55.30%

- Starts new 'Plus schemes' loans such as Justice Plus intended for
the judges and court employees, Police Plus for the police personnel,
Teacher Plus for the teaching community and Doctor Plus for the
medical practitioners

- Receives RBI licence to set up offshore banking units (OBUs) in special economic zones (SE

- Launches SBI Bangalore card meant for a broad-based target audience

in the 25 plus age group ranging from upwardly mobile professionals
and middle class segments

- SBI unveils Hyderabad card, an exclusive initiative for the

citizens of Hyderabad

- Ananta Chandra Kalita ceases to be a Director of SBI

- Christens the tieup with Maruti Udyog Ltd. as SBI-Maruti Finance

- Orders For 1,500 ATMs With NCR Corporation

- Orange, the cellular service operator of the Hutch group for the
Mumbai circle, ties up with State Bank of India for prepaid card
refill options

- Ropes in US-based consultant McKinsey & Co to undertake Business

Process Re-engineering (BPR) exercise for the bank

- Launches charter for Small Scale Industries (SSIs)

- NPA (Non Performing Assets) slashed to 4.5 pc, writes off Rs 4,000
crore worth of assets

34
- Forays into stock market

- Stock price crosses the Rs 400 mark for the first time since
listing on BSE

- Mr. A K Batra, Managing Director & Group Executive (Corporate

Banking) of the Bank ceases to be a Director on the Board with effect
from July 8, 2003

- Plans a new scheme to attract Resurgent India Bonds (RIB)

- N S Sisodia, Secretary (Banking & Insurance), Ministry of Finance

and Company Affairs, Department of Economic Affairs (Banking
Division), has been nominated as a Director on the Board of State
Bank of India w.e.f. July 11, 2003

- Mr. Ananta Chandra Kalita, Head Assistant, State Bank of India,

appointed as a Director on the Central Board of the Bank amongst the
employees of the Bank

- Inks two important agreements with its employees' unions and

officers' associations. According to the contract SBI's staff will
be having no rights to interfere in bank's computerisation plans

- SBI, AirTel launch mobility service at Rs 299

- Central government nominates Mr. Arun Singh as a director on the

board of the bank wef July 25, 2003 for a period of three years.

- State Bank of India along with ANZ Investment Bank have consummated
5 year syndicate loan facility of 0 million to Indian
Petrochemicals Corporation (IPCL)

- Opens cheque clearing cente at Kolkata

- Inks pact with Mahindra & Mahindra (M&M) for co-branded tractor
scheme SBI-Mahindra Tractor Plus

- Joins hands with Tractors and Farm Equipment Ltd (TAFE) for tractor
loans

- Launches insurance scheme in Kerala

- Unveils new retail bank loan product Credit Khazana, which targets
the bank's housing loan account holders

35
- Unveils online ticket reservation system 'e-Rail'

- Reserve Bank of India nominates Dr Rakesh Mohan, Deputy Governor,

RBI, on the Central Board of the bank

- Appoints Mr. C. Narasimhan as the Chief General Manager of the SBI's Kerala Circle

-Unveils Credit Khazana, retail bank loan product, to target the bank's housing loan account ho

- MRO-TEK Ltd has secured State Bank of India's order of Rs 15-crore

to provide networking solutions of 2Mbps and 64 Kbps high-end leased
line modems for SBI to connect more than 800 branches across the country.

-SBI joins hands with LIC to dentify long-term investment proposals

for LIC

-Tied with bajaj Auto to finance its two wheelers.

-SBI granted Rs 125-cr loan to Nethaji Apparel park to set up units

and buy machinery for the first batch of 54 garment plants in the
65-acre special apparel park.

-The bank has tied up with TVS motor company to finance two wheeler
loans

-Tied up with apollo hospital enterprise to finance for the hospital

treatement.

-The company launched mobile pre-paid cards recharge facility at its

ATM's

-Tied up with ICICI Bank and HDFC for sharing ATM networks

2003-Bank has entered into MOU with both ICICI Bank and HDFC Bank for
sharing Bank's ATM Network with them on bilateral terms.

-The Central Government after consultation with the Reserve Bank of

India, appointed Shri Chandan Bhattacharya, Deputy Managing Director
State Bank Of India as Managing Director State Bank Of India for the
period from December 17, 2003 to January 31, 2005.

-The State Bank of India has announced a special package to BSNL

employees by allowing concessional interest rates for different types
of loans to be availed by the BSNL staff.

36
2004

-Former KCCI President nominated to SBI Bangalore Local Board

-State Bank Of India has informed that Reserve Bank of India has
nominated Shri A V Sardesai, Executive Director, Reserve Bank of
India on the Central Board of State Bank of India vice Dr. Rakesh
Mohan.

-SBI sets up ATM counter in Ernakulam

-Bahrain Monetary Agency (BMA) grants in-principle licence to Statte

Bank of India (SBI)

-SBI sets up India's first drive-in ATM in Hyderabad

-State Bank of India has entered into an alliance with HDFC Bank for
sharing ATM networks to be operationalised from February 3, this
year.

2004

-SBI unveils new branch in Manjeri

-Bank awarded special prize for lending to self help group run by
women

-SBI unveils floating ATM

-State Bank of India appointed six new Deputy Managing Directors on

February 11, 2004. The new DMDs are: Mr. T.S. Bhattacharya, CGM,
Product Development and Marketing, Mr. M.M.Lateef, Managing Director,
SBI Gilts, Mr. Yogesh Agarwal, CGM, Chandigarh, Mr. Krishnamurthy, CGM,
Madras LHO and Mr. R.Ramanathan, CGM, Technology and Mr. Vijay Anand,
CGM, Corporate Account group. These top level appointments follow the
appointment of the new Managing Director for the bank, Mr. Chandan
Bhattacharya, in December.

-GAIL ties up SBI for e-banking system

-SBI join hands with Visa for travel card

-SBI enters into ATM sharing agreements with UTI Bank & HDFC Bank

-Signs a Memorandum of Understanding (MoU) under which the bank will

37
provide term loans to farmers for purchasing capital inputs from Jain
Irrigation Systems Ltd (JISL)

-Join hands with Siemens for financing the medical equipments sold by
Siemens

-Joins hands with VST Tillers to launch SBI-VST Shakti, a new loan
scheme for farm mechanisation programme

-Unveils Vishwa Yatra foreign travel card, a prepaid card which

offers the traveller a convenient and secure way to carry cash

-Ties up with Same Deutz-Fahr India for tractor financing

-In ally with Sikkim govt to beef up SMEs

-The government has chosen State Bank of India (SBI) for channelising
government credit to other countries which runs into billions of
dollar

-SBI opens MICR cheque processing center

-Signs MoU with HMT Ltd. for financing their tractors

-State Bank of India deploys Flexcube as core banking solution at

Frankfurt

-Mr. Ashok K. Kini appointed as new Managing Director of State Bank of

India with effect from April 1, 2004 to December 31, 2005

-SBI unveils Foreign Travel card in Orissa

-ICICI Bank, SBI, LIC in pact for Rs 20,000-cr projects

-Reliance Info in ATM pact with SBI

-State Bank of India, Bangalore Circle, has announced its tie-up with
New India Assurance Company Ltd (NIAC), for distribution of NIAC's
general insurance products in Karnataka

- SBI unveils new credit card in Ahmedabad

-State Bank of India joined the billion dollar club

-THE State Bank of India opened its 236th branch in the State at
Tripunithura on June 16

38
-SBI inaugurates first Internet shoppe in Kochi

-State Bank of India has opened a fully computerized branch at

Karunagappally in Kollam district

-L&T-John Deere Private Ltd has signed a memorandum of understanding

(MoU) with State Bank of India for tractor finance

-Buys 10% stake in Multi Commodity Exchange of India Ltd. (MCDEX)

for Rs 2.1 crore

-SBI join hands with Hero Honda to unveil co-branded credit card

-State Bank of India launched its first mobile ATM for increasing the
banking convenience of its customers

-State Bank of India has signed a Memorandum Of Understanding (MOU)

with the Societe Generale Asset Management of France (SGAM) for
inducting Societe Generale Asset Management as a stake holding
partner for SBI's mutual fund arm, SBI Fund Management Private Ltd
(SBIFMPL)

-State Bank of India, (SBI) with a view to expand the ambit of its
educational loan schemes, has unveiled a unique educational loan
scheme, christened Nursing Plus, for the nursing students of the
country

-SBI forges alliance with Hero Honda

-SBI offers new scheme`School Plus' for schools

-SBI Card has launched 'Instant Card' offering customers in need of

instant credit opportunity. With this, the customers will get an
opportunity to get ready to use credit card within a few hours of
filing in their application form

-SBI selects Finacle for international ops

-SBI enters ATM tie up with Andhra Bank

-SBI join hands with LIC for funding infrastructure projects

-Tata Motors on December 7, 2004, signs an MoU with State Bank of

India (SBI)

39
-SBI partners with Eicher Motors on December 27, 2004

2005

-Raj Travels joins hands with SBI for travel loans

-SBI opens branch at Vadakara

-SBI join hands with Apollo Health to offer loans

-SBI rolls out new loan scheme

-SBI opens first branch in Lakshadweep island of Kavaratti

-SBI enters into agreement for bilateral sharing of ATMs with PNB on
May 10, 2005

-SBI signs MOU with Corporation Bank for ATM sharing

-State Bank of India and 8 associate banks have entered into an

agreement with Bharat Petroleum Corporation Ltd (BPCL) for enhancing
card usage at fuel stations

-SBI launches new mortgage loan scheme for traders

-SBI launches SBI card in Madurai

-SBI inaugurates RBO in Thrissur

-SBI signed a memorandum of understanding with Small Industries

Development Bank of India for co-financing small and medium
enterprises in Andhra Pradesh, Tamil Nadu, Uttar Pradesh, Jammu &
Kashmir, Jharkhand, Delhi and Bihar

-State Bank of India and Crisil have signed a memorandum of

understanding under which latter will assign ratings to small-scale
industries that are borrowers of SBI

-NSIC join hands with SBI to offer credit to SSI

2006

-SBI teams up with Nihilent to unveil feedback system

-Bhatt to become SBI's new MD

40
-State Bank of India (SBI) has informed that Shri. Yogesh Agarwal has
been appointed as Managing Director on the Board of the Bank with
effect from October 10, 2006 to the June 30, 2010

2007

-State Bank of India (SBI) has appointed Shri. S K Bhattacharya as

Managing Director on the Board of the Bank with effect from October
08, 2007 to the October 31, 2010, as per the Notification dated
October 08, 2007, by the Government of India.

- The State Bank of India (SBI) has become the first foreign bank to
set up a branch in the Israel's diamond exchange. Besides diamonds,
they also see huge potential in telecommunications, hi-tech,
chemicals, textiles, agriculture and water management, food
processing, pharma and health care.

2008

-State Bank of India (SBI) has informed that the Government of India
in pursuance of clause (e) of Section 19 of the State Bank of India
Act, 1955 (23 of 1955) has nominated Shri. Arun Ramanathan,
Secretary, Ministry of Finance, Department of Financial Services, New
Delhi as a Director on the Central Board of State Bank of India with
effect from January 18, 2008, vice Shri. Vinod Rai.

-State Bank of India (SBI) has informed that the Central Government,
in consultation with the Reserve Bank of India and in pursuance of
clause (d) of Section 19 of the State Bank of India Act, 1955 (23 of
1955), has nominated Dr. (Mrs.) Vasantha Bharucha as a part-time
non-official Director on the Central Board of State Bank of India for
a period of three years with effect from February 25, 2008, vice Shri
Piyush Goel.

- State Bank of India (SBI) has informed that the Central Government,
in consultation with the Reserve Bank of India and in pursuance of
clause (d) of Section 19 of the State Bank of India Act, 1955 (23 of
1955), has nominated Dr. Rajiv Kumar as part-time non-official
director on the Central Board of Directors of State Bank of India for
a period of three years with effect from September 08, 2008 or until
further orders, whichever is earlier.

- State Bank of India (SBI) has signed a Joint Venture Agreement with
Insurance Australia Group to form a Joint Venture Company which will
be engaged in General Insurance business in India.

41
- State Bank of India has rolled out a micro insurance scheme
'Grameen Shakti', for its Self Help Group (SHG) members. The product
was launched on Nov 26 at the Tamil Nadu Agricultural University. The
bank is hopeful to cover at least five lakh SHG members by December
31.

-The company has issued rights in the ratio of 1:5 at a premium of

Rs.1580/- Per Share.

2009

- State Bank of India yesterday slashed its benchmark lending rate by

half a percentage point to 11.75 per cent. The Benchmark Prime Lending
Rate (BPLR) was revised down by 50 basis points with effect from June
29, SBI informed the Bombay Stock Exchange. This move would benefit
home, car and corporate loan customers

- State Bank of India on June 30 launched two new home loan products
called as SBI Easy Home Loan and SBI Advantage Home Loan, with zero
processing fees for both waived off till September 30. While SBI Easy
Home is for loans amount up to Rs 30-lakh while the SBI Advantage Home
is for loans above Rs 30-lakh, a press release issued here said.

- State Bank of India, entered into an agreement with the government

of Gujarat to create a fund of Rs 5,000 crore for investing in equity
of infrastructure projects.

2010

- State Bank of India, with a debit card base of over 70 million,

comprising SBI Cash Plus, SBI Gold Debit Card and SBI Yuva Card, has
added chip and PIN-based Platinum Debit Card to its bouquet on March 26.

- Mr. Arun Kumar Agarwal has taken over charge as General Manager at
State Bank of India, Kerala Circle. Until now, he has been General
Manager at the Lucknow Circle of the bank. Mr. Agarwal is Certified
Associate of Indian Institute of Bankers and joined State Bank of
India as a Probationary Officer in 1977. An expert in credit and
foreign exchange, he has held several assignments ranging from Branch
Manager to Regional Manager in the Patna and Delhi circles. He also
served in the bank's foreign department at Kolkata handling
investment of the FCNB portfolio, derivatives and correspondent
relations. He has headed the Pune Module of the bank and has also
served as the Deputy General Manager and Business Head for Network-1
of the Mumbai Circle.

42
- State Bank of India (SBI) has signed a pact with Unique
Identification Authority of India (UIDAI) to work as a registrar for
the UID registration of residents. It has become the first bank to
take up registration work for the UIDAI project. As a registrar, SBI
will capture through empanelled enrolment agencies, the biometric
characters such as finger prints, iris and so on and send the
information to UIDAI.

BALANCE SHEET FOR THE YEAR ENDING ON MARCH 2007-2011

2007 2008 2009 2010 2011

CAPITAL AND LIABILITIES
Total share capital 526.30 631.47 634.88 634.88 635.00
Equity share capital 526.30 631.47 634.88 634.88 635.00
Share application money 0.00 0.00 0.00 0.00 0.00
Preference share capital 0.00 0.00 0.00 0.00 0.00
Reserves 30772.26 48401.09 57312.82 65314.32 64351.04
Revaluation reserves 0.00 0.00 0.00 0.00 0.00
Net worth 31298.56 49032.66 57947.70 65949.20 64986.04
Deposits 435521.09 537403.94 742073.13 804116.23 933932.81
Borrowings 39703.34 51727.41 53713.68 103011.60 119568.96
Total debt 475224.43 589131.35 795786.81 907127.83 1053501.77
Other liabilities and provisions 60042.26 83362.30 110697.57 80336.70 105248.39
Total liabilities 566565.25 721526.31 964432.08 1053413.73 1223736.20

2007 2008 2009 2010 2011

ASSETS
Cash and balances with RBI 29,076.43 51534.62 55546.17 61290.87 94395.50
Balance with banks, money at
call 22892.27 15931.72 48857.63 34892.98 28478.65

Advances 337336.49 416768.20 542503.20 631914.15 756719.45

Investments 149148.88 189501.27 275953.96 285790.07 295600.57
Gross block 13189.28 11831.63 10403.03 11831.63 13189.28
Accumulated depreciation 8757.33 7713.90 6828.65 7713.90 8757.33
Fixed Assets 4431.95 4117.73 3574.41 4117.73 4431.95
Capital work in progress 332.23 295.18 263.44 295.18 332.23
Other assets 43777.85 35112.76 37733.27 35112.76 43777.85
Total assets 566565.25 721526.31 964432.08 1053413.74 1223736.20

43
 Contingent liabilities 585294.50 429917.37 614603.47 429917.37 585294.50
Bills for collection 205092.29 166449.04 152964.06 166449.04 205092.29
Book value 1023.40 1038.76 912.73 1038.76 1023.40
EPS 86.29 106.56 143.67 144.37 116.07

Net block= gross block depreciation Net block = fixed assets

PROFIT AND LOSS ACCOUNT OF STATE BANK OF INDIA

FOR THE ENDING ON MARCH 2007-2011

2007 2008 2009 2010 2011

Income:
Interest earned 39491.03 48950.31 63788.43 70993.92 81394.36
Other income 7446.76 9398.43 12691.35 14968.15 14935.09

Total income 46937.79 58348.74 76479.78 85962.07 96329.45

Expenditure:
Interest expended 23436.82 31929.08 42915.29 47322.48 48867.96
Operating expenses 13251.78 14609.55 18123.66 24941.01 31430.88
Total expenses 42396.48 51619.62 67358.55 76796.02 88959.12
Other provision and contingencies 5707.88 5080.99 6319.60 4532.53 8660.28
Net profit 4541.31 6729.12 9121.23 9166.05 7370.37
Extraordinary items 0.00 0.00 0.00 0.00 0.00
Profit B/F 0.34 0.34 0.34 0.34 0.34
Total 4541.65 6729.46 9121.57 9166.39 7370.69
Preference dividend 0.00 0.00 0.00 0.00 0.00
Equity dividend 736.82 1357.66 1841.15 1904.65 1905.00
Corporate dividend tax 125.22 165.87 248.03 236.76 246.52
Per share data:
EPS 86.29 106.56 143.67 144.37 116.07
Equity dividend (%) 140.00 215.00 290.00 300.00 300.00
Book value 594.69 776.48 912.73 1038.76 1023.40
Appropriations
Transfer to statutory reserve 3682.15 5205.69 6725.15 6495.14 2488.96
Transfer to other reserve -2.88 -0.10 306.90 529.50 2729.87
Proposed dividend/ transfer to 862.04 1523.53 2089.18 2141.41 2151.52
govt.
Balance C/F to balance sheet 0.34 0.34 0.34 0.34 0.34
Total 4514.65 6729.46 9121.57 9166.39 7370.69

44
SUSTAINABLE EARNINGS OF STATE BANK OF INDIA:

201103 201003 200903 200803 200703

(12) (12) (12) (12) (12)
I. INCOME

Total 97218.96 85962.07 76482.74 58437.42 44671.37

II. Expenditure

Total 88954.44 76796.02 67361.51 51708.3 40130.06

Fringe Benefit tax 0 0 142 105 88.5

Deferred Tax 976.82 -1407.75 -1055.1 -219.43 -19.83
Reported Net Profit 8264.52 9166.05 9121.23 6729.12 4541.31
Extraordinary Items -10.23 -5.83 -1.71 7 4.52
Adjusted Net Profit 8274.75 9171.88 9122.94 6722.12 4536.79

average of adjusted Net Profit 2009,2010 and

2011
8856.52333

rounding off 8857

Standard deviation : 504.33

Rounding off 504

CRAR%

201103 201003 200903

CRAR(%)
Year End 201103 201003 200903
CRAR - Tier I (%) 7.77 9.45 9.38
CRAR - Tier II (%) 4.21 3.94 4.87
Total CRAR (%) 11.98 13.39 14.25

45
 Total CRAR (%)
2009 14.25
YEAR 2010 13.39
2011 11.98

14.5 14.25

14
13.39
13.5

13

12.5
11.98 Total CRAR (%)
12

11.5

11

10.5
2009 2010 2011
year

RATIO ANALYSIS:
CURRENT RATIO:

An indication of a company's ability to meet short-term debt obligations; the

higher the ratio, the more liquid the company is. Current ratio is equal to current
assets divided by current liabilities. If the current assets of a company are more
than twice the current liabilities, then that company is generally considered to
have good short-term financial strength. If current liabilities exceed current
assets, then the company may have problems meeting its short-term obligations.

CURRENT RATIO = CURRENT ASSETS / CURRENT LIABILITY

46
 CURRENT RATIO

YEAR 2007-2011
YEAR RATIO
2007 0.05
2008 0.07
2009 0.04
2010 0.04
2011 0.04

LIQUID RATIO:

Liquid ratio is also known as Quick or Acid Test Ratio. Liquid assets refer to
assets which are quickly convertible into cash. Current Assets other stock and
prepaid expenses are considered as quick assets.

Quick Ratio = Total Quick Assets

Total Current Liabilities

Quick Assets = Total Current Assets Inventory

47
 Year Ratio
2007 6.52
2008 6.15
2009 5.74
2010 9.07
2011 8.50

quick ratio
10 9.07
9 8.5
8
7 6.52
6.15
5.74
6
5
quick ratio
4
3
2
1
0
1 2 3 4 5

EARNING PER SHARE:

In order to avoid confusion on account of the varied meanings of the term capital

employed, the overall profitability can also be judged by calculating earning per
share with the help of the following formula:

Earning Per Equity Share = Net Profit after Tax Preference Dividend

No. of Equity shares

The earning per share of the company helps in determining the market price of
the equity shares of the company. A comparison of earning per share of the
company with another will also help in deciding whether the equity share capital
is being effectively used or not. It also helps in estimating the companys capacity
to pay dividend to its equity shareholders.

48
 Year Ratio

2007 86.29

2008 106.56

2009 143.67

2010 144.37

2011 116.07

Ratio
160
143.67 144.37
140
116.07
120 106.56
100 86.29
80
Ratio
60
40
20
0
1 2 3 4 5

DIVIDEND PER SHARE :

It is expressed by dividing dividend paid to equity shareholders by no. of equity

shares. This shows the per share dividend given to equity shareholders. It is very
helpful for potential investors to know the dividend paying capacity of the
company. It affects the market value of the company.

Dividend Per Share = Dividend Paid To Equity Shareholders

No. Of Equity Shares

49
 dividend per share

2007 14
year 2008 21.5
2009 29
2010 30
2011 30

35
29 30 30
30

25
21.5
20
14
15 dividend per share

10

0
2007 2008 2009 2010 2011
year

NET PROFIT RATIO:

This ratio indicates the Net margin on a sale of Rs.100. It is calculated as follows:

Net Profit Ratio = Net Profit X 100

Net Sales

This ratio helps in determining the efficiency with which affairs of the business
are being managed. An increase in the ratio over the previous period indicates
improvement in the operational efficiency of the business. The ratio is thus on
effective measure to check the profitability of business.

50
 YEAR NET PROFIT RATIO
2007 10.12
2008 11.65
2009 12.03
2010 10.54
2011 8.55

14
11.65 12.03
12
10.12 10.54
10
8.55
8

6 net profit ratio

0
2007 2008 2009 2010 2011
year

RETURN ON NET WORTH:

It measures the profitability of the business in view of the shareholders. It judges

the earning capacity of the company and the adequacy of return on proprietors
funds. Shareholders and potential investors are interested in this ratio. It is
calculated as below:

Return On Net Worth = Net Profit After Interest And Tax x 100

Shareholders Funds

return on
shareholder's

2007 14.5
year 2008 13.72
2009 15.74
2010 13.89
2011 12.71

51
 18
15.74
16 14.5
13.72 13.89
14 12.71
12
10
8
return on shareholder's
6
4
2
0
2007 2008 2009 2010 2011
year

DEBT- EQUITY RATIO:

The Debt-Equity ratio is calculated to find out the long-term financial position of
the firm. This ratio indicates the relationship between long-term debts and
shareholders funds. The soundness of long-term financial policies of a firm can
be determined with the help of this ratio. It helps to assess the soundness of
long-term financial policies of a business. It also helps to determine the relative
stakes of outsiders and shareholders. Long-term creditors can assess the
security of their funds in a business. It indicates to what extent a firm depends
upon lenders to meet its long-term financial requirements. A low Debt-Equity ratio
is considered better from the point of view of creditors.

Total Debt to Owners Fund

2007 13.92
Year 2008 10.96
2009 12.81
2010 12.19
2011 14.37

52
 Total Debt to Owners Fund
16 14.37
13.92
14 12.81
12.19
12 10.96
10
8
Total Debt to Owners
6 Fund
4
2
0
2007 2008 2009 2010 2011
year

FIXED ASSETS TURNOVER RATIO:

It is also called as Sales to Fixed Assets Ratio. It measures the efficient use of
fixed assets. This ratio is a measure of efficient use of fixed assets. it is
calculated as:

Fixed Assets Turnover Ratio = Cost of goods sold or Sales

Net Fixed Assets

It measures the efficiency and profit earning capacity of the business. Higher the
ratio, greater is the intensive utilization of fixed assets and a lower ratio shows
under utilization of the fixed assets. This ratio has a special importance for
manufacturing concerns where investment in fixed assets, is very high and the
profitability is significantly dependent on the utilization of these assets.

Assets turnover
ratio
2007 5.44
2008 6.32
YEAR 2009 7.2
2010 7.26
2011 7.24

53
 8
7.2 7.26 7.24
7 6.32
6 5.44
5

4
assets turnover ratio
3

0
2007 2008 2009 2010 2011
year

CREDIT-DEPOSIT RATIO:

This ratio is very important to assess the credit performance of the bank. The
ratio shows the relationship between the amount of deposit generated by the
bank as well as their deployment towards disbursement of loan and advances.
Higher credit deposit ratio shows overall good efficiency and performance of any
banking institution.

Credits
Credit Deposit Ratio 100
Deposits

Credit means disbursement of advances

Deposit mean sum of fixed deposit,

Saving deposit and current deposit.

CREDIT DEPOSIT RATIO

2007 73.44
YEAR 2008 77.51
2009 74.97
2010 75.96
2011 79.9

54
 82
79.9
80

78 77.51

75.96
76 74.97
credit deposit ratio
74 73.44

72

70
2007 2008 2009 2010 2011
year

CASH DEPOSIT RATIO :

CASH DEPOSIT RATIO

2007 6.22
YEAR 2008 8.29
2009 8.37
2010 7.56
2011 8.96

10
8.96
9 8.29 8.37
8 7.56
7 6.22
6
5
4 cash deposit ratio
3
2
1
0
2007 2008 2009 2010 2011
YEAR

55
CAPITAL TURNOVER RATIO :

Income / capital employed

CAPITAL TURNOVER RATIO

2007 8.46
YEAR 2008 8.96
2009 8.99
2010 8.62
2011 8.48

9.1
8.96 8.99
9
8.9
8.8
8.7 8.62
8.6
8.48 CAPITAL TURNOVER
8.5 8.46 RATIO
8.4
8.3
8.2
8.1
2007 2008 2009 2010 2011
YEAR

Total assets turnover ratio:

TOTAL ASSETS TURNOVER RATIO

2007 0.08
year 2008 0.09
2009 0.09
2010 0.09
2011 0.08

56
 0.092
0.09 0.09 0.09
0.09
0.088
0.086
0.084
0.082 total assets turnover
0.08 0.08 ratio
0.08
0.078
0.076
0.074
2007 2008 2009 2010 2011
year

PRICE- EARNING RATIO:

Price earning ratio = market price per share/ earning per share

Price Earning (P/E)

2007 11.83
Year 2008 15.38
2009 7.63
2010 14.78
2011 21.92
25
21.92

20

15.38 14.78
15
11.83

10 Price Earning (P/E)

7.63

0
2007 2008 2009 2010 2011
Year

57
Price to Book Value:
Market Value of Security/ book value of shares

Price to Book Value ( P/BV)

2007 1.67
year 2008 2.06
2009 1.17
2010 2
2011 2.7
3
2.7

2.5

2.06 2
2
1.67

1.5
1.17 Price to Book Value ( P/BV)

0.5

0
2007 2008 2009 2010 2011
year

58
Enterprise Value / EBIDTA

EV/EBIDTA
2007 15.64
YEAR 2008 14.46
2009 13.64
2010 15.33
2011 17.07

EV/EBIDTA
18 17.07
15.64 15.33
16 14.46
13.64
14
12
10
8
EV/EBIDTA
6
4
2
0
2007 2008 2009 2010 2011
year

59
 INTRODUCTION

Bank of Baroda (BoB) is the third largest bank in India, after the State Bank of
India and the Punjab National Bank and ahead of ICICI Bank. BoB is ranked 763
in Forbes Global 2000 list. BoB has total assets in excess of Rs. 3.58 lakh
crores, or Rs. 3,583 billion, a network of over 3,409 branches and offices, and
about 1,657 ATMs. It plans to open 400 new branches in the coming year. It
offers a wide range of banking products and financial services to corporate and
retail customers through a variety of delivery channels and through its
specialized subsidiaries and affiliates in the areas of investment banking, credit
cards and asset management. Its total business was Rs. 5,452 billion as of June
30.

As of August 2010, the bank has 78 branches abroad and by the end of FY11
this number should climb to 90. In 2010, BOB opened a branch in Auckland, New
Zealand, and its tenth branch in the United Kingdom. The bank also plans to
open five branches in Africa. Besides branches, BoB plans to open three outlets
in the Persian Gulf region that will consist of ATMs with a couple of people.

The Maharajah of Baroda, Sir Sayajirao Gaekwad III, founded the bank on 20
July 1908 in the princely state of Baroda, in Gujarat. The bank, along with 13
other major commercial banks of India, was nationalized on 19 July 1969, by the
government of India.

BALANCE SHEET OF BANK OF BARODA

2007 2008 2009 2010 2011

Total Share Capital 365.53 365.53 365.53 365.53 392.81
Equity Share Capital 365.53 365.53 365.53 365.53 392.81
Share Application Money 0 0 0 0 0
Preference Share Capital 0 0 0 0 0
Reserves 8284.41 10,678.40 12,470.01 14,740.86 20,600.30
Revaluation Reserves 0 0 0 0 0
Net Worth 8649.94 11,043.93 12,835.54 15,106.39 20,993.11
Deposits 124915.98 152,034.13 192,396.95 241,044.26 305,439.48
Borrowings 1142.56 3,927.05 5,636.09 13,350.09 22,307.85
Total Debt 126058.54 155,961.18 198,033.04 254,394.35 327,747.33
Other Liabilities & Provisions 8437.70 12,594.41 16,538.15 8,815.97 9,656.73
Total Liabilities 143146.18 179,599.52 227,406.73 278,316.71 358,397.17
Assets 2007 2008 2009 2010 2011

Cash & Balances with RBI 6413.52 9,369.72 10,596.34 13,539.97 19,868.18
Balance with Banks, Money
at Call 11866.85 12,929.56 13490.77 21,927.09 30,065.89

60
Advances 83620.87 106,701.320 143985.90 175,035.29 228,676.36
Investments 34943.63 43,870.07 52445.88 61,182.38 71,260.63
Gross Block 2244.62 3,787.14 3954.13 4,266.60 4,548.16

Accumulated Depreciation 1155.81 1,360.14 1644.41 1,981.84 2,248.44

Net Block 1088.81 2427.00 2309.72 2,284.76 2,299.72
Capital Work In Progress 0 0 0 0 0
Other Assets 5212.5 4301.83 4578.12 4,347.22 6,226.40

Total Assets 143146.18 179599.5 227406.73 278,316.71 358,397.180

Contingent Liabilities 54999.86 75364.33 64745.82 77,997.01 112,272.64

Bills for collection 12976.53 15105.51 22584.64 27,949.60 33,735.67
Book Value (Rs) 237.46 303.18 352.37 414.71 536.16
EPS 28.18 39.41 61.14 83.96 108.33

PROFIT AND LOSS OF BANK OF BARODA

PROFIT & LOSS OF IN RS.

BANK OF BARODA CR.
2007 2008 2009 2010 2011
Income:
Interest earned 9,212.64 11,813.5 15,091.6 16,698.3 21,885.9
Other income 1,381.79 2,051.04 2,757.66 2,806.36 2,809.19
Total income 10,594.4 13,864.5 17,849.2 19,504.7 24,695.1
Expenditure:
Interest expended 5,426.56 7,901.67 9,968.17 10,758.9 13,083.7
Operating expenses 2,771.45 3,370.27 3,844.66 4,711.23 5,669.88
Other provision and
1,369.95 1,157.05 1,809.20 976.28 1,699.88
contingencies
Total expenses 9,568.0 12,429.0 15,622.0 16,446.4 20,453.4

Net profit 1,026.46 1,435.52 2,227.20 3,058.33 4,241.68

Extraordinary items 0 0 0 0 0
Profit B/F 0 0 0 0 0
Total 1,026.46 1,435.52 2,227.20 3,058.33 4,241.68

Preference dividend 0 0 0 0 0
Equity dividend 252.46 340.94 383.56 639.26 753.35
Corporate dividend tax 0 0 0 0 0

61
Per share data:
EPS 28.18 39.41 61.14 83.96 108.33
Equity dividend (%) 60 80 90 150 165
Book value 237.46 303.18 352.37 414.71 536.16
Appropriations
Transfer to statutory
reserve 271.5 444.23 1,136.23 1,162.07 1,387.87
Transfer to other
reserve 502.5 650.35 707.41 1,257.00 2,100.46
Proposed dividend/
transfer to govt. 252.46 340.94 383.56 639.26 753.35
Balance C/F to
balance sheet 0 0 0 0 0

Total 1,026.46 1,435.52 2,227.20 3,058.33 4,241.68

RATIO ANALYSIS OF BANK OF BARODA:

Current ratio: CURRENT ASSETS/ CURRENT LIABILITIES

Current Ratio
2007 0.04
YEAR 2008 0.03
2009 0.02
2010 0.02
2011 0.02

Current Ratio
0.045
0.04
0.04
0.035
0.03
0.03
0.025
0.02 0.02 0.02
0.02
Current Ratio
0.015
0.01
0.005
0
2007 2008 2009 2010 2011
year

62
QUICK RATIO:

Quick Ratio
2007 11.29
YEAR 2008 9.56
2009 9.62
2010 21.88
2011 26.38

Quick Ratio
30
26.38
25 21.88
20

15
11.29
9.56 9.62 Quick Ratio
10

0
2007 2008 2009 2010 2011
year

Earnings
Per
Share

2007 28.18
year 2008 39.41
2009 61.14
2010 83.96
2011 108.33

63
 Earnings Per Share
120 108.33
100
83.96
80
61.14
60
39.41 Earnings Per Share
40 28.18
20

0
2007 2008 2009 2010 2011
year

Total Debt to Owners Fund

2007 14.44
YEAR 2008 13.77
2009 14.99
2010 15.96
2011 14.55

Total Debt to Owners Fund

16.5
15.96
16
15.5
14.99
15
14.44 14.55
14.5
Total Debt to Owners
14 13.77
Fund
13.5
13
12.5
2007 2008 2009 2010 2011
year

64
 Cash Deposit Ratio
2007 4.46
YEAR 2008 5.7
2009 5.8
2010 5.57
2011 6.11

Cash Deposit Ratio

7
6.11
5.7 5.8 5.57
6
5 4.46
4
3
Cash Deposit Ratio
2
1
0
2007 2008 2009 2010 2011
year

Credit
Deposit
Ratio

2007 65.67
year 2008 68.72
2009 72.78
2010 73.6
2011 73.87

65
 Credit Deposit Ratio
76
73.6 73.87
74 72.78
72
70 68.72
68
65.67
66 Credit Deposit Ratio
64
62
60
2007 2008 2009 2010 2011
year

Asset Turnover Ratio

2007 4.25
YEAR 2008 3.47
2009 4.2
2010 4.48
2011 5.25

Asset Turnover Ratio

6
5.25
5 4.48
4.25 4.2
4 3.47

3
Asset Turnover Ratio
2

0
2007 2008 2009 2010 2011
year

66
 Total Assets Turnover Ratios
2007 0.07
Year 2008 0.08
2009 0.08
2010 0.08
2011 0.08

Total Assets Turnover Ratios

0.082
0.08 0.08 0.08 0.08
0.08
0.078
0.076
0.074
0.072 Total Assets Turnover
0.07
0.07 Ratios
0.068
0.066
0.064
2007 2008 2009 2010 2011
year

Total Income / Capital Employed(%)

2007 7.83
YEAR 2008 8.57
2009 8.51
2010 7.86
2011 7.75

67
 Total Income / Capital
Employed(%)
8.8
8.57 8.51
8.6
8.4
8.2
8 7.83 7.86
7.75 Total Income / Capital
7.8
Employed(%)
7.6
7.4
7.2
2007 2008 2009 2010 2011
year

Net Profit / Total Funds

2007 0.8
YEAR 2008 0.89
2009 1.09
2010 1.21
2011 1.33

Net Profit / Total Funds

1.4 1.33
1.21
1.2 1.09
1 0.89
0.8
0.8
0.6
Net Profit / Total Funds
0.4
0.2
0
2007 2008 2009 2010 2011
year

68
 Dividend Per
Share

2007 6
Year 2008 8
2009 9
2010 15
2011 16.5

Dividend Per Share

18 16.5
16 15
14
12
10 9
8
8
6 Dividend Per Share
6
4
2
0
2007 2008 2009 2010 2011
year

PRICE- EARNING RATIO:

Price earnings ratio = market price per share/ earnings per share

PRICE-
EARNING

2007 7.93
YEAR 2008 7.49
2009 3.95
2010 7.87
2011 9.15

69
 10 9.15
9
7.93 7.87
8 7.49
7
6
5
3.95
4 PRICE- EARNING
3
2
1
0
2007 2008 2009 2010 2011
YEAR

PRICE- BOOK VALUE

Market Value of Security/ book value of shares

PRICE-BOOK VALUE
2007 0.91
YEAR 2008 0.94
2009 0.67
2010 1.55
2011 1.8

2
1.8
1.8
1.55
1.6
1.4
1.2
1 0.91 0.94
PRICE-BOOK
0.8 0.67 VALUE
0.6
0.4
0.2
0
2007 2008 2009 2010 2011
YEAR

70
ENTERPRISE TO EBIDTA:

EV/EBIDTA
2007 15.9
YEAR 2008 13.93
2009 14.01
2010 15.93
2011 16.64

17 16.64
16.5
15.9 15.93
16
15.5
15
14.5
14.01 EV/EBIDTA
13.93
14
13.5
13
12.5
2007 2008 2009 2010 2011
YEAR

71
TREND ANALYSIS

Trend Analysis is the practice of collecting information and attempting to spot a

pattern, or trend, in the information. In some fields of study, the term "trend
analysis" has more formally-defined meaning.

Although trend analysis is often used to predict future events, it could be used to
estimate uncertain events in the past, such as how many ancient kings probably
ruled between two dates, based on data such as the average years which other
known kings reigned.

TREND ANALYSIS OF STATE BANK OF INDIA

BASE YEAR 2006-2007

percentage (%)
figures
2007 2008 2009 2010 2011

deposits 100 123 170 185 214

advances 100 124 161 187 224
net profit 100 148 201 202 162

250

200

150
deposits
advances
100
net profit

50

0
2007 2008 2009 2010 2011

72
INTERPRETATION:

There is a continuous increase in deposits

There is a increase of advances

There is a increase in net profits till 2010 but there is a fall in 2011

The overall performance of the bank is satisfactory.

TREND ANALYSIS OF BANK OF BARODA

Bank of Baroda

Base year 2006-2007

In percentage(%) figures

2007 2008 2009 2010 2011

deposits 100 122 154 193 245

advances 100 128 172 209 273
net profit 100 140 217 298 413

450

400

350

300

250 deposits

200 advances
net profit
150

100

50

0
2007 2008 2009 2010 2011

73
INTERPRETATION:

Deposits:-

The trend shows that the deposits are increasing from 2007-2011

Advances:-

The trend of advances shows that it is increasing in those four years 2008-2011

Net profit:-

The trend of net profit shows the increase from 2008-2011

BETA ANALYSIS

A measure of the volatility, or systematic risk, of a security or a portfolio in

comparison to the market as a whole. Beta is used in the capital asset pricing
model (CAPM), a model that calculates the expected return of an asset based on
its beta and expected market returns..
Also known as "beta coefficient".

74
 BETA VALUATION OF STATE BANK OF INDIA

1 2 3 4 5 6 7 8
Retur
Return- n of
Return
average Variance sbi- Covariance
of Return
Month Sensex SBI of return of avera of SENSEX
SENS of sbi
of SENSEX ge of and SBI
EX
SENSEX return
of sbi
3,233.
10-Sep 20,069.12 20
3,151.
10-Oct 20,032.34 20 0.00 -0.03 0.01 0.0001 0.01 0.0001
2,994.
10-Nov 19,521.25 10 -0.03 -0.05 -0.01 0.0002 -0.01 0.00014
2,811.
10-Dec 20,509.09 05 0.05 -0.06 0.06 0.0040 -0.02 -0.001407
2,641.
11-Jan 18,327.76 05 -0.11 -0.06 -0.09 0.0088 -0.02 0.002018
2,632.
11-Feb 17,823.40 00 -0.03 0.00 -0.01 0.0002 0.04 -0.000525
2,767.
11-Mar 19,445.22 90 0.09 0.05 0.10 0.0108 0.09 0.009392
2,805.
11-Apr 19,135.96 60 -0.02 0.01 0.00 0.0000 0.05 -0.000167
2,297.
11-May 18,503.28 80 -0.03 -0.18 -0.02 0.0004 -0.14 0.00289
2,405.
11-Jun 18,845.87 95 0.02 0.05 0.03 0.0010 0.09 0.002686
2,342.
11-Jul 18,197.20 00 -0.03 -0.03 -0.02 0.0005 0.01 -0.000268
1,974.
11-Aug 16,676.75 50 -0.08 -0.16 -0.07 0.0050 -0.12 0.008358
1,945.
11-Sep 16,933.83 55 0.02 -0.01 0.03 0.0008 0.02 0.000683

AVERAGE
RETURN -0.01 -0.04 0.0026 0.00200
COVARIAN 0.0019955
CE 9
0.0026429
VARIANCE 5

BETA 0.755062

75
 BETA VALUATION OF BANK OF BARODA

1 2 3 4 5 6 7 8
return-
RETURN average return-
RETURN OF BANK of return average covariance
BANK OF OF OF on variance of return of sensex
MONTH SENSEX BARODA SENSEX BARODA sensex of sensex on BOB and BOB
10-Sep 20,069.12 872.8
10-Oct 20,032.34 1,011.00 -0.0018 0.1583 0.0109 0.000119 0.1650 0.0018
10-Nov 19,521.25 937.75 -0.0255 -0.0725 -0.0128 0.000164 -0.0725 0.0009
10-Dec 20,509.09 896.5 0.0506 -0.0440 0.0633 0.00401 -0.0440 -0.003
11-Jan 18,327.76 869.15 -0.1064 -0.0305 -0.0936 0.008768 -0.0305 0.0029
11-Feb 17,823.40 870.85 -0.0275 0.0020 -0.0148 0.000219 0.0020 -3E-05
11-Mar 19,445.22 963.15 0.0910 0.1060 0.1037 0.010757 0.1060 0.011
11-Apr 19,135.96 912.15 -0.0159 -0.0530 -0.0032 1.01E-05 -0.0530 0.0002
11-May 18,503.28 863.4 -0.0331 -0.0534 -0.0203 0.000414 -0.0534 0.0011
11-Jun 18,845.87 871.9 0.0185 0.0098 0.0312 0.000976 0.0098 0.0003
11-Jul 18,197.20 878.3 -0.0344 0.0073 -0.0217 0.000471 0.0073 -0.00016
11-Aug 16,676.75 736.6 -0.0836 -0.1613 -0.0708 0.005018 -0.1613 0.0114
11-Sep 16,933.83 774.8 0.0154 0.0519 0.0281 0.000792 0.0519 0.0015

AVERAGE
RETURN -0.0127 -0.0066 0.002643 0.0023

COVARIANCE 0.00234

VARIANCE 0.002643

BETA 0.884385

76
RATIO ANALYSIS

A tool used by individuals to conduct a quantitative analysis of information in a

company's financial statements. Ratios are calculated from current year numbers
and are then compared to previous years, other companies, the industry, or even
the economy to judge the performance of the company. Ratio analysis is
predominately used by proponents of fundamental analysis.

There are many ratios that can be calculated from the financial statements
pertaining to a company's performance, activity, financing and liquidity. Some
common ratios include the price-earnings ratio, debt-equity ratio, earnings per
share, asset turnover and working capital.

SUSTAINABLE EARNINGS OF BANK OF BARODA

IN RS. CR.
201003 200903 200803 200703
201103 (12) (12) (12) (12) (12)
INCOME :

Total 24695.1 19504.7 17876.11 13892.18 10438.12

II. Expenditure

Total 20453.42 16446.37 15648.91 12456.66 9411.66

Fringe Benefit tax 0 0 0 11 7.5

Deferred Tax 0 0 0 -3.12 -3.11
Reported Net
Profit 4241.68 3058.33 2227.2 1435.52 1026.46
Extraordinary
Items -0.12 56.12 62.29 0.22 8.01
Adjusted Net
Profit 4241.8 3002.21 2164.91 1435.3 1018.45

Average of Adjusted net profit for the year 2009,2010,2011

2009 2164.91
2010 3002.21
2011 4241.8

Sum = 9408.92

Average = 3136.30

77
Standard deviation 1044.466

Rounding off 1044

CRAR% OF BANK OF BARODA:

201103 201003 200903

CRAR(%)
Year End 201103 201003 200903
CRAR - Tier I (%) 9.99 9.2 8.49
CRAR - Tier II (%) 4.53 5.16 5.56
Total CRAR (%) 14.52 14.36 14.05

Total CRAR (%)

2009 14.05
YEAR 2010 14.36
2011 14.52

14.6
14.52
14.5

14.4 14.36

14.3

14.2
Total CRAR (%)
14.1 14.05

14

13.9

13.8
2009 2010 2011
year

78
 RESEARCH TOPIC

THE COMPARATIVE STUDY OF FINANCIAL PERFORMANCE OF STATE

BANK OF INDIA AND BANK OF BARODA.

OBJECTIVE OF THE STUDY:-

1. To know the strength and weakness of State Bank Of India and Bank Of
Baroda through Ratio analysis.
2. To evaluate the performance of the companies.
3. To understand the liquidity, profitability and efficiency positions of the
companies.
4. To make comparison between the ratios during different periods.

INTRODUCTION

Financial Management is the specific area of finance dealing with the financial
decision corporations make, and the tools and analysis used to make the
decisions. The discipline as a whole may be divided between long-term and
short-term decisions and techniques. Both share the same goal of enhancing firm
value by ensuring that return on capital exceeds cost of capital, without taking
excessive financial risks.
Capital investment decisions comprise the long-term choices about which
projects receive investment, whether to finance that investment with equity or
debt, and when or whether to pay dividends to shareholders.
Short-term corporate finance decisions are called working capital management
and deal with balance of current assets and current liabilities by managing cash,
inventories, and short-term borrowings and lending (e.g., the credit terms
extended to customers). Corporate finance is closely related to managerial
finance, which is slightly broader in scope, describing the financial techniques
available to all forms of business enterprise, corporate or not.

79
RESEARCH METHODOLOGY
The conclusive research is being used to study the comparison of the
companies.

Data collection:
Secondary data is being taken from Websites

Outcomes of the study:

1. With this analysis we come to know about the strength and weakness
of State Bank Of India and Bank Of Baroda through Ratio analysis.
2. To evaluate the performance of the companies.
3. To understand the liquidity, profitability and efficiency positions of the
companies.
4. To make comparison between the ratios during different periods.

Limitation of the study:

The study is done in Kanpur

Study is constrained to only the comparison of State Bank Of India and Bank Of
Baroda.

TOOLS USED:

Comparative analysis

Ratio analysis

Trend analysis

Beta valuation

Sustainable earnings

Basel-II CRAR % capital requirement

Cash Flow Statement Analysis

STATISTICAL TOOL:

CAPITALINE

SPSS

80
 ANALYSIS

Introduction to the topic

FINANCIAL ANALYSIS

Financial analysis is the process of identifying the financial strengths and

weaknesses of the firm and establishing relationship between the items of the
balance sheet and profit & loss account.
Financial ratio analysis is the calculation and comparison of ratios, which are
derived from the information in a companys financial statements. The level and
historical trends of these ratios can be used to make inferences about a
companys financial condition, its operations and attractiveness as an
investment. The information in the statements is used by
Trade creditors, to identify the firms ability to meet their claims i.e. liquidity
position of the company.
Investors, to know about the present and future profitability of the company
and its financial structure.
Management, in every aspect of the financial analysis. It is the responsibility
of the management to maintain sound financial condition in the company.

RATIO ANALYSIS
The term Ratio refers to the numerical and quantitative relationship between
two items or variables. This relationship can be exposed as
Percentages
Fractions
Proportion of numbers

Ratio analysis is defined as the systematic use of the ratio to interpret the
financial statements. So that the strengths and weaknesses of a firm, as well as
its historical performance and current financial condition can be determined.
Ratio reflects a quantitative relationship helps to form a quantitative judgment.

81
STEPS IN RATIO ANALYSIS

The first task of the financial analysis is to select the information relevant to
the decision under consideration from the statements and calculates appropriate
ratios.
To compare the calculated ratios with the ratios of the same firm relating to
the pas6t or with the industry ratios. It facilitates in assessing success or failure
of the firm.
Third step is to interpretation, drawing of inferences and report writing
conclusions are drawn after comparison in the shape of report or recommended
courses of action.

BASIS OR STANDARDS OF COMPARISON

Ratios are relative figures reflecting the relation between variables. They enable
analyst to draw conclusions regarding financial operations. They use of ratios as
a tool of financial analysis involves the
comparison with related facts.

NATURE OF RATIO ANALYSIS

Ratio analysis is a technique of analysis and interpretation of financial

statements. It is the process of establishing and interpreting various ratios for
helping in making certain decisions. It is only a means of
understanding of financial strengths and weaknesses of a firm. There are a
number of ratios which can be calculated from the information given in the
financial statements, but the analyst has to select the appropriate data and
calculate only a few appropriate ratios. The following are the four steps
involved in the ratio analysis.
Selection of relevant data from the financial statements depending upon the
objective of the analysis.
Calculation of appropriate ratios from the above data.
Comparison of the calculated ratios with the ratios of the same firm in the
past, or the ratios developed from projected financial statements or the ratios of
some other firms or the comparison with ratios of the
industry to which the firm belongs.

INTERPRETATION OF THE RATIOS

The interpretation of ratios is an important factor. The inherent limitations of ratio

analysis should be kept in mind while interpreting them.
The impact of factors such as price level changes, change in accounting policies,
window dressing etc., should also be kept in mind when attempting to interpret
ratios.

82
IMPORTANCE OF RATIO ANALYSIS

Aid to measure general efficiency

Aid to measure financial solvency
Aid in forecasting and planning
Facilitate decision making
Aid in corrective action
Aid in intra-firm comparison
Act as a good communication
Evaluation of efficiency
Effective tool

LIMITATIONS OF RATIO ANALYSIS

Differences in definitions
Limitations of accounting records
Lack of proper standards
No allowances for price level changes
Changes in accounting procedures
Quantitative factors are ignored
Limited use of single ratio
Background is over looked
Limited use
Personal bias

IN THE VIEW OF FUNCTIONAL CLASSIFICATION THE RATIOS ARE

1. Liquidity ratio
2. Leverage ratio
3. Activity ratio
4. Profitability ratio

1. LIQUIDITY RATIOS

Liquidity refers to the ability of a concern to meet its current obligations as &
when there becomes due. The short term obligations of a firm can be met only
when there are sufficient liquid assets. The short term obligations are met by
realizing amounts from current, floating (or) circulating assets The current assets
should either be calculated liquid (or) near liquidity. They should be convertible
into cash for paying obligations of short term nature. The sufficiency (or)
insufficiency of current assets should
be assessed by comparing them with short-term current liabilities. If current
assets can pay off current liabilities, then liquidity position will be satisfactory.
To measure the liquidity of a firm the following ratios can be
calculated

83
 Current ratio
Quick (or) Acid-test (or) Liquid ratio
Absolute liquid ratio (or) Cash position ratio

(a) CURRENT RATIO:

Current ratio may be defined as the relationship between current assets and
current liabilities. This ratio also known as Working capital ratio is a measure of
general liquidity and is most widely used to
make the analysis of a short-term financial position (or) liquidity of a firm.

Current ratio= current assets/ current liabilities

Components of current ratio:

Current Assets Current Liabilities

CuCash in handrrent AcunnnnSSETS Outstanding expenses
Cash at bank Bank overdraft
Bills receivable Bill payable
Inventories Short term advances
Work-in-progress Sundry creditors
Marketable securities Dividend payable
Short-term investments Income-tax payable
Sundry debtors
Prepaid expenses

(b) QUICK RATIO

Quick ratio is a test of liquidity than the current ratio. The term liquidity refers to
the ability of a firm to pay its short-term obligations as & when they become due.
Quick ratio may be defined as the relationship
between quick or liquid assets and current liabilities. An asset is said to be liquid
if it is converted into cash with in a short period without loss of value.

84
Quick or liquid assets

Quick Ratio= quick or liquid assets/ current liabilities

Components

Quick Assets Current liabilities

Cash in hand Outstanding or accrued expenses
Cash at bank Bank overdraft
Bills receivable Bills payable
Sundry debtors Short term advances
Marketable securities Sundry creditors
Temporary investments Dividend payable
Income tax payable

(c) ABSOLUTE LIQUID RATIO

Although receivable, debtors and bills receivable are generally

more liquid than inventories, yet there may be doubts regarding their
realization into cash immediately or in time. Hence, absolute liquid ratio
should also be calculated together with current ratio and quick ratio so as to
exclude even receivables from the current assets and find out the absolute
liquid assets.

Absolute liquid ratio = Absolute liquid assets/Current liabilities

Absolute liquid assets include cash in hand etc. The acceptable

forms for this ratio is 50% (or) 0.5:1 (or) 1:2 i.e., Rs.1 worth absolute liquid
assets are considered to pay Rs.2 worth current liabilities in time as all the
creditors are nor accepted to demand cash at the same time and then cash
may also be realized from debtors and inventories.
Components:

Absolute liquid assets Current liabilities

Cash in hand Outstanding or accrued expenses
Cash in bank Bank overdraft
Interest on fixed deposits Bills payable
Dividend payable
Sundry creditors
Short term advances
Income tax payable

85
2. LEVERAGE RATIOS

The leverage or solvency ratio refers to the ability of a concern

to meet its long term obligations. Accordingly, long term solvency ratios
indicate firms ability to meet the fixed interest and costs and repayment
schedules associated with its long term borrowings.
The following ratio serves the purpose of determining the
solvency of the concern.
Proprietory ratio

(a) PROPRIETORY RATIO

A variant to the debt-equity ratio is the proprietary ratio which

is also known as equity ratio. This ratio establishes relationship between
share holders funds to total assets of the firm.

Proprietory ratio = Shareholders funds/ Total assets

Shareholder fund Total Assets
Share capital Fixed assets
Reserve& surplus Current assets
Cash in hand
Cash at bank
Bills receivable
Inventories
Marketable securities
Short term investment
Sundry debtors
Prepaid expenses

3. ACTIVITY RATIOS
Funds are invested in various assets in business to make sales
and earn profits. The efficiency with which assets are managed directly
effect the volume of sales. Activity ratios measure the efficiency (or)
effectiveness with which a firm manages its resources (or) assets. These
ratios are also called Turn over ratios because they indicate the speed with
which assets are converted or turned over into sales.
Working capital turnover ratio
Fixed assets turnover ratio
Capital turnover ratio
Current assets to fixed assets ratio

86
(a) WORKING CAPITAL TURNOVER RATIO
Working capital of a concern is directly related to sales.
Working capital= current assets current liabilities
It indicates the velocity of the utilization of net working capital.

This indicates the no. of times the working capital is turned over in the

course of a year. A higher ratio indicates efficient utilization of working

capital and a lower ratio indicates inefficient utilization.

Working capital turnover ratio=cost of goods sold/workingcapital.

Components of working capital:

Current assets Current liabilities

Cash in hand Outstanding or accrued expenses

Cash at bank Bank overdraft

Bills receivable Bills payable

Prepaid expenses Short term advances

Short term investments Sundry creditors

Inventories Dividend payable

Work in progress Income tax payable

Marketable securities

Sundry debtors

(b) FIXED ASSETS TURNOVER RATIO

It is also known as sales to fixed assets ratio. This ratio measures the efficiency
and profit earning capacity of the firm. Higher the
ratio, greater is the intensive utilization of fixed assets. Lower ratio means
under-utilization of fixed assets.
Fixed assets turnover ratio = Cost of Sales/ Net fixed assets
Cost of Sales = Income from Services
Net Fixed Assets = Fixed Assets - Depreciation

87
(c) CAPITAL TURNOVER RATIOS

Sometimes the efficiency and effectiveness of the operations

are judged by comparing the cost of sales or sales with amount of capital
invested in the business and not with assets held in the business, though in
both cases the same result is expected. Capital invested in the business may be
classified as long-term and short-term capital or as fixed capital and working
capital or Owned Capital and Loaned Capital. All Capital
Turnovers are calculated to study the uses of various types of capital.

Capital turnover ratio= cost of goods sold/capital employed

Capital employed = capital+ reserves& surplus

Cost of goods sold = income from services

(d) CURRENT ASSETS TO FIXED ASSETS RATIO

This ratio differs from industry to industry. The increase in the

ratio means that trading is slack or mechanization has been used. A decline in
the ratio means that debtors and stocks are increased too much or fixed assets
are more intensively used. If current assets increase with the corresponding
increase in profit, it will show that the business is expanding.

Current assets to fixed assets ratio= current assets/ fixed assets

Current assets Fixed assets

Cash in hand Plant

Cash at bank Machinery

Bills receivables Land

Short term investment Building

Inventories Vehicles

Sundry debtors

Work in progress

Marketable securities

88
4. PROFITABILITY RATIOS

The primary objectives of business undertaking are to earn profits. Because profit
is the engine, that drives the business enterprise.
Net profit ratio
Return on total assets
Reserves and surplus to capital ratio
Earnings per share
Operating profit ratio
Price earning ratio
Return on investments

(a) NET PROFIT RATIO

Net profit ratio establishes a relationship between net profit (after tax) and sales
and indicates the efficiency of the management in manufacturing, selling
administrative and other activities of the firm.

Net profit after tax = net profit-( depreciation+ interest+ income tax)

Net sales = income from services

Net profit ratio = net profit after tax/ net sales

It also indicates the firms capacity to face adverse economic

conditions such as price competitors, low demand etc. Obviously higher the
ratio, the better is the profitability.

(b) RETURN ON TOTAL ASSETS

Profitability can be measured in terms of relationship between net profit and

assets. This ratio is also known as profit-to-assets ratio. It measures the
profitability of investments. The overall profitability can be known.

Returns on assets = net profit / total assets

Net profit = earnings before interest and tax

Total assets = current assets+ fixed assets

89
(c) RESERVES AND SURPLUS TO CAPITAL RATIO

It reveals the policy pursued by the company with regard to

growth shares. A very high ratio indicates a conservative dividend policy
and increased ploughing back to profit. Higher the ratio better will be the
position.

Reserves& surplus to capital ratio = reserves& surplus/capital

(d) EARNINGS PER SHARE

Earnings per share is a small verification of return of equity and

is calculated by dividing the net profits earned by the company and those
profits after taxes and preference dividend by total no. of equity shares.

Earnings per share = net profit after tax/ no. of equity shares

The Earnings per share is a good measure of profitability when

compared with EPS of similar other components (or) companies, it gives a
view of the comparative earnings of a firm.

(e) OPERATING PROFIT RATIO

Operating ratio establishes the relationship between cost of goods sold and other
operating expenses on the one hand and the sales on
the other.

Operating ratio = operating cost / net sales

However 75 to 85% may be considered to be a good ratio in case of a

manufacturing under taking.
Operating profit ratio is calculated by dividing operating profit
by sales.

Operating profit = net sales operating cost

Operating profit ratio = operating profit / sales

90
(f) PRICE - EARNING RATIO

Price earning ratio is the ratio between market price per equity
share and earnings per share. The ratio is calculated to make an estimate of
appreciation in the value of a share of a company and is widely used by
investors to decide whether (or) not to buy shares in a particular company.
Generally, higher the price-earning ratio, the better it is. If the
price earning ratio falls, the management should look into the causes that
have resulted into the fall of the ratio.

Price earning ratio = market price per share/ earning per share

Market price per share = capital + reserves& surplus / no. of equity shares

Earning per share = earnings before interest and tax / no. of equity shares

(g) RETURN ON INVESTMENTS

Return on share holders investment, popularly known as Return on investments
(or) return on share holders or proprietors funds is
the relationship between net profit (after interest and tax) and the
proprietors funds.

Return on shareholders investment = net profit after interest and tax /

shareholders fund

The ratio is generally calculated as percentages by multiplying

the above with 100.

91
 FINANCIAL COMPARATIVE ANALYSIS

BALANCE SHEET OF STATE BANK OF INDIA

FOR THE YEAR ENDING ON MARCH 2007-2011 IN RS CR.

2007- 2008- 2009- 2010-

2008 2009 2010 2011
%
Absolute % Absolute % Absolute % Absolute
chan
change change change change change change change
ge
Capital &
Liabilities
Capital 105.17 19.98 3.41 0.0054 0.00 0.00 0.12 0.018
Reserve& (1.47
17628.83 57.28 8910.91 18.41 8001.5 13.96 (963.28)
surplus )
101882.8
deposits 23.39 204669.19 38.08 62043.1 8.36 129816.58 16.14
5
borrowings 12024.07 30.28 1986.27 3.83 49297.92 91.77 16557.36 16.07
Other
(30360.3 31.00
liabilities and 23320.04 38.83 27335.27 32.79 (27.42) 24911.69
0) 9
provisions
TOTAL
CAPITAL 154961.0
27.35 242905.77 33.66 88981.65 9.226 170322.47 16.16
AND 6
LIABILITIES
2007-08 2008-09 2009-10 2010-11
%
Absolute % Absolute % Absolute % Absolute
chan
change change change change change change change
ge
Assets:
Investments 40352.39 27.055 86452.69 45.62 9836.11 3.56 9810.5 3.43
Advances 79431.71 23.54 125735 30.16 89410.95 16.48 124805.3 19.75
Fixed assets (314.22) (0.070) (543.32) (0.13) 543.32 0.15 314.22 0.076
Capital Work 0.125
(37.05) (0.11) (31.74) (0.107) 31.74 0.1204 37.05
In Progress 5
Current (2620.51
(8665.09) (0.19) 2620.51 0.074 (0.069) 8665.09 0.24
assets )
TOTAL 154961.0
27.35 242905.77 33.66 88981.65 9.226 170322.47 16.16
ASSETS: 6

92
Interpretation :

The capital of bank increased by 19.98%in 07-08, 0.0054% in 08-09, 0.018% in

10-11.

There is no change in capital of the bank in the year 09-10

There is a huge fluctuation in the rate of increasing in reserves& surplus .

The bank is utilizing its reserves &surplus in an effective manner.

In 07-08 deposits increase by 23.39%, 08-09 it increase by 38.08%, 8.36% in 09-

10,16.14% in 10-11.

There is a huge fluctuating rate of increase . in 08-09 it had fluctuate to 3.83%.

The investment in 10-11 has increased with a low rate as compared to the
preceding years .27.55% in 07-08,45.62% in 08-09,3.56% in 09-10,3.43% in 10-
11.

The advances rose by 23.54% in 07-08,30.16% in 08-09,16.48% in 09-10,

19.75% in 10-11.

There has been a consistent decline in fixed assets in 07-08 and 08-09 0.070%
,0.13% respectively. Increased by 0.15% in 09-10, 0.076% in 10-11.

There is a fall of current assets 0.19% in 07-08 mainly due to the repayment of
deposits.0.074% in 08-09, subsequent fall of current assets 0.069% in 09-10,
and increase of 0.24% in 10-11.

93
 PROFIT AND LOSS OF STATE BANK OF INDIA FOR THE YEAR ENDING ON
MARCH 2007-2011 IN RS CR.

Particulars 2007-08 2008-09 2009-10 2010-11

absolute % absolute % absolute % absolute %
change change change change change change change change
INCOME:
operating
11410.95 0.24 18131.04 0.31 9482.29 0.12 10367.38 0.12
income
EXPENDITURE:
interest
8492.26 0.36 10986.21 0.18 4407.19 0.10 1545.48 0.032
expended
3514.11
operating
1357.77 0.10 0.24 6817.35 0.37 6489.87 0.26
expenses
9223.14
total expenses 0.21 15738.93 0.30 9437.47 0.14 12163.1 0.15

provision and -
-626.89 -0.10 1238.61 0.24 0.14 12163.1 0.15
contingencies 1787.07
net profit of the
2187.81 0.48 2392.11 0.35 44.82 0.004914 -1795.68 -0.19
year
extraordinary
0 0 0 0 0 0 0 0
items
profit brought
0 0 0 0 0 0 0 0
forward
total
2187.81 0.48 2392.11 0.35 44.82 0.004914 -1795.68 -0.19
profit/(loss):

INTERPRETATION:

Net Profit Of The Year: it shows a fluctuating trend i.e., increased by 48%
in2007-08,35% in 2008-09,0.49% in 2009-10 and decline by 19% in 2010-11due
to increased tax liability. Interest Expended: it increases from 36% in 2007-
08,18% in 2008-09, 10% in 2009-10 and 3.20% in 2010-11.

94
BALANCE SHEET OF BANK OF BARODA FOR THE YEAR ENDING ON
MARCH 2007-2011

2007- 2008- 2009- 2010-

2008 2009 2010 2011
% % % %
absolute chan absolute chan absolute chan absolute chan
change ge change ge change ge change ge
capital &
liabilities:
0.07
Capital 0 0 0 0 0 0 27.28 4631
reserves& 0.28 0.16 0.18 0.39
surplus 2393.99 8975 1791.61 7779 2270.85 2105 5859.44 7496
27118.1 0.21 40362.8 0.26 48647.3 0.25 64395.2 0.26
Deposits 5 7091 2 5485 1 2849 2 7151
2.43 0.43 1.36 0.67
Borrowings 2784.49 7062 1709.04 5197 7714 8679 8957.76 0989
-
other 0.49 0.31 0.46 0.09
liabilities 4156.71 2635 3943.74 3134 -7722.18 693 840.76 5368
TOTAL
LIABILITIES 36453.3 0.25 47807.2 0.26 50909.9 0.22 80080.4 0.28
: 4 4658 1 6188 8 3872 6 7731
2007-08 2008-09 2009-10 2010-11
% % % %
absolute chan absolute chan absolute chan absolute chan
change ge change ge change ge change ge
ASSETS
0.25 0.19 0.16 10078.2 0.16
Investments 8926.44 5453 8575.81 5482 8736.5 6581 5 4725
23080.4 0.27 37284.5 0.34 31049.3 0.21 53641.0 0.30
Advances 5 6013 8 9429 9 5642 7 6459
(0.05 (0.01
fixed assets 1338 1.2 (117) ) (25) ) 15 0.01
capital work
in progress 0 0 0 0 0 0 0 0
36453.3 0.25 47807.2 0.26 50909.9 0.22 80080.4 0.28
Total assets 2 4658 3 6188 8 3872 7 7731

95
INTERPRETATION:

The capital of the bank shows no change till 2009-10 but it increases by 7.40% in
2010-11.

There is a huge fluctuation in the increase of reserves and surplus. It increases

by 28% in 2007-08,16%in 2008-09,18% in 2009-10 and 39% in 2010-11.

The investments has increased with a low rate . 2007-08- 25%,2008-09 19%,
2009-10 16.6%, 2010-11-16.47%

There is a fluctuating in increase in advances 27% in 2007-08,34.9% in 2008-09,

21.5%in 2009-10, 30.64% in 2010-11.

There is decline of fixed assets in 2008-09 and 2009-10 with 5% and 1%

respectively. The reason may be the increase in the rate of depreciation in the
subsequent years.

There has been an increase in borrowings. 243% in 2007-08, 43.5% in 2008-09,

136% in 2009-10,67% in 2010-11.

96
PROFIT AND LOSS OF BANK OF BARODA FOR THE YEAR ENDING ON
MARCH 2007-11

absolute absolute absolute absolute

change % change % change % change %
2007-08 2008-09 2009-10 2010-11
particulars
income:
30.8 28.7 9.27 26.6
total income 3,270.1 7% 3,984.7 4% 1,655.5 % 5,190.4 1%
expenditure:
45.6 26.1 7.93 21.6
interest expended 2,475.11 1% 2,066.50 5% 791 % 2,324.8 1%
21.6 14.0 22.5 20.3
operating expenses 598.82 1% 474.39 8% 866.57 4% 958.65 5%
- -
other provisions and 15.5 56.3 46.0 74.1
contingencies -212.90 4% 652.15 6% -832.92 4% 723.60 2%
29.9 25.6 5.28 24.3
total expenses 2,861.0 0% 3,193.0 9% 824.3 % 4,007.1 6%
39.8 55.1 37.3 38.6
net profit of the year 409.06 5% 791.68 5% 831.13 2% 1,183.35 9%
0.00 0.00 0.00 0.00
extra ordinary items 0 % 0 % 0 % 0 %
0.00 0.00 0.00 0.00
profit brought forward 0 % 0 % 0 % 0 %
39.8 55.1 37.3 38.6
total 409.06 5% 791.68 5% 831.13 2% 1,183.35 9%

INTERPRETATION:

The net profit of the year shows a fluctuating trend i.e., 39.85% in 2007-
08,55.15% in2008-09,37.32% in 2009-10and 38.69% in 2010-11.

The interest expended shows a fluctuating trend in 2007-08 to 2010-11

2007-08-45.61%,2008-2009-26.51% ,

BETA VALUATION :

state bank of
India bank of Baroda
beta 0.8 0.9

97
 beta

0.9
0.88
0.86
0.84
0.82 beta
0.8
0.78
0.76
0.74
state bank of bank of baroda
india

The graph shows the compare beta of SBI and BOB which is 0.8 and 0.9
which means that both are comparatively good. There betas are<1 which
means it is goodfor the investors to invest in the bank as it is less risky in
nature.

SUSTAINABLE EARNINGS:

SBI BOB
SUSTAINABLE
EARNINGS 8857 3136

SUSTAINABLE EARNINGS
10000
8857
9000
8000
7000
6000
5000 SUSTAINABLE
4000 EARNINGS
3136
3000
2000
1000
0
SBI BOB

98
 CRAR% ANALYSIS :

SBI BOB
BASEL-II
CRAR% 11.98 14.52

BASEL-II CRAR%
16 14.52
14
11.98
12
10
8
BASEL-II CRAR%
6
4
2
0
SBI BOB

CASH FLOW STATEMENT ANALYSIS OF BANK OFBARODA:

2007 2008 2009 2010 2011

2207.1 3342.9 4238.0 5650.3
NET PROFIT BEFORE TAX 1654.26 6 4 6 2
NET CASH FROM OPERATING 2241.8 1125.4 11252. 11778.
ACTIVITIES 5153.94 2 7 45 81
NET CASH USED IN FROM INVESTING - -
ACTIVITIES -307.65 235.13 -238.93 -335.01 489.76
NET CASH USED IN FROM FINANCING 2012.2 3177.9
ACTIVITIES -20.56 3 901.29 462.51 6
NET (DECREASE)/INCREASE IN CASH 4018.9 1787.8 11379. 14467.
AND CASH EQUIVALENT 4825.73 2 3 94 01
18280. 22299. 24087. 35467.
OPENING CASH 13454.64 37 29 12 06
22299. 24087. 35467. 49934.
CLOSING CASH 18280.37 29 12 06 07

99
CASH FLOW STATEMENT ANALYSIS OF STATE BANK OF INDIA:

2007 2008 2009 2010 2011

PARTICULARS
Net Profit Before Tax 7625.08 10438.9 14180.64 13926.1 14954.23
Net Cash From Operating Activities -1776.07 -856.87 29479.73 -1804.99 34282.52
Net Cash (used in)/from Investing -284.56 -2798.01 -1651.93 -1761.52 -1245.53
activities
Net Cash (used in)/from Financing
Activities 9494.11 19371.12 5097.38 -3359.67 2057.11
Net (decrease)/increase In Cash and
Cash Equivalents 7433.49 15716.24 32925.18 -6926.18 35094.1
Opening Cash & Cash Equivalents 44535.2 51968.69 71478.62 103110 87780.05
Closing Cash & Cash Equivalents 51968.69 67466.34 104403.8 96183.84 122874.2

100
FINDINGS, SUGGESTIONS AND CONCLUSIONS
State bank of India Bank of
Baroda
Particulars
1. Beta valuation 0.8 0.9
2. sustainable earnings ( standard 504 1044
deviation)
Average sustainable earnings 8857 3136

3. Cash flow statement analysis: 14467.01 35094.1

4. Basel-II CRAR% 11.98 14.52

5. Profit & Loss statement analysis (19%) 38.69%
6. Balance sheet statement 16 28%
analysis
7. Ratio analysis:
a. P/E ratio 21.92 9.15
b. P/BV 2.7 1.8
c. EV/EBIDTA 17.07 16.64
YEAR 2011

SBI BOB
P/E 21.92 9.15
P/BV 2.7 1.8
EV/EBIDTA 17.07 16.64
25
21.92

20
17.07 16.64

15
SBI

10 9.15 BOB

5
2.7
1.8

0
P/E P/BV EV/EBIDTA

101
INTERPRETATION:

P/E RATIO OF State bank of India is 21.92 which is more than the P/E ratio of its
peerset bank of Baroda 9.15 which means that it is overvalued and strongly
sound in nature.

P/BV

The ratio of state bank of india is 2.7 and that of its peerset is 1.8 which means
the bank is highly overvalued in nature

EV/EBIDTA

The ratio of state bank of india is 17.07 and that of its peerset is 16.64 which
means that the bank is closely related to its peerset.

Both are fundamentally sound in nature.

SBI BOB
credit deposit
ratio 79.9 73.87
CASH DEPOSIT 8.96 6.11

90
79.9
80 73.87
70

60

50
credit deposit ratio
40 CASH DEPOSIT
30

20
8.96
10 6.11

0
SBI BOB

102
CREDIT-DEPOSIT RATIO:

This ratio assess the credit performance of the bank.

The graph shows that state bank of india and bank of baroda both are
performing well as both banks has overall good efficiency in nature.

SBI-79.9

BOB 73.87

State bank of India has overall good efficiency and performance of banking
institutions.

CASH DEPOSIT RATIO:

This ratio assesses the cash performance of the bank.

The graph shows that state bank of India and bank of Baroda is performing well
in nature.

SUSTAINABLE
EARNINGS
SBI BOB
STANDARD DEVIATION 504 1044
AVERAGE 8857 3136

10000
8857
9000
8000
7000
6000
5000 STANDARD
DEVIATION
4000 3136 AVERAGE
3000
2000
1044
1000 504
0
SBI BOB
SUSTAINABLE EARNINGS

103
OUTCOME:

Since the average sustainable earnings is high and standard deviation of state
bank of India is low which means that the bank is fundamentally sound and it is
performing good as compared to bank of Baroda.

INDUSTRY SBI BOB

P/E
RATIO 6.43 21.92 9.15

P/E RATIO
25
21.92

20

15

9.15 P/E RATIO

10
6.43
5

0
INDUSTRY SBI BOB

INTERPRETATION:

Since the industry P/E ratio is 6.43 ,SBI 21.92,BOB 9.15.

It means that State bank of India P/E ratio is more than the industry/peerset
company which means it is overvalued and it is fundamentally sound in nature
as compared to its industry/ peerset bank of Baroda.

104
 SBI BOB
dividend payout
ratio 26.03 17.76

dividend payout ratio

30
26.03
25

20 17.76

15
dividend payout ratio
10

0
SBI BOB

INTERPRETATION:

SBI 26.03

BOB 17.76

There is increase in ratio in the year 2011 in both the banks .

SBI BOB

Earnings Per Share 116.07 108.33

Book Value 1,023.40 536.16

Dividend Per Share 30 16.5

Price Earning (P/E) 21.92 9.15
Price to Book Value (
P/BV) 2.7 1.8

105
It is indicated that EPS AND DPS ARE INCREASING OF STATE BANK OF
INDIA AS COMPARED TO BANK OF BARODA .

THE REASON MAY BE THAT THERE IS MORE USE OF DEBTTHAN DUE TO

IMPROVED OPERATIONS.

P/E RATIO AND P/BV RATIO BOTH ARE INCREASING . .

THE OVERALL EFFICIENCY OF THE COMPANY IS GOOD AND IT IS

PERFORMANCE IS BETTER IN THE BANKING INSTITUTION.

106
 CONCLUSIONS:
1. State Bank Of India has overall better efficiency and has performed better
in the banking institution as compared to Bank Of Baroda.
2. EPS And DPS Of State Bank Of India is increasing due to increase in the
use of debt rather than the use of improved operations.
3. The P/E Ratio Of State Bank Of India is high as compared to its industry
and Bank Of Baroda which means that SBI is using its funds in a better
manner and it is fundamentally sound in nature.
4. Beta Of State Bank Of India And Bank Of Baroda is less than the market
beta which means that both banks are giving less returns but they are less
risky and investors can invest in these shares.
5. The Average Sustainable Earnings Of State Bank Of India is high and the
standard deviation is low so the bank has its earnings is sustain and more
robust in nature as compared to Bank of Baroda.
6. The Credit Deposit Of State Bank Of India And Bank Of Baroda is close
but the ratio is high which means that State Bank Of India has overall
good efficiency and better performance, i.e., the bank has high credit
deposit ratio.

107
 REFERENCES:

http://en.wikipedia.org/wiki/State_Bank_of_India

http://en.wikipedia.org/wiki/Bank_of_Baroda
http://www.moneycontrol.com/financials/statebank of India/balance-
sheet/SBI

http://www.moneycontrol.com/financials/bankofbaroda/balance-sheet/BOB
http://www.moneycontrol.com/financials/bankofbaroda/profit&loss/BOB

http://www.moneycontrol.com/financials/bankofbaroda/profit&loss/SBI

www.google.com

www.capitaline.com

www.sbi.com

www.investopedia.com

108