Presentation on

Key Performance Indicators (KPI) and CAMEL analysis Of

AXIS BANK

And

IDBI BANK

• Presented to: Presented by:

Dr. A. C. Mehta Neel Sharma(13F53)

G. H. Patel P G Institute of Business Management,

Sardar Patel University,

V. V. Nagar

2013-15

Introduction to

• Formerly known as Unit Trust of India (UTI)

• First of the new private banks to have begun operations in 1994, after

the Government of India allowed new private banks to be established

• Was jointly promoted by UTI, LIC, GIC and four PSU insurance

companies

• The Bank as on 31st December, 2011 is capitalized to the extent of Rs.

412.57 crores with the public holding (other than promoters and GDRs)

at 53.63%.

• very wide network of more than 1281 branches & network of over 7591

ATMs (including 169 Service Branches/CPCs as on 31st March, 2011)

• 70% of corporate advances have rating of at least ‘A’ as at December

2011

• 80% of SME advances have rating of at least ‘SME3’ as at December

2011

• strengths in both retail and corporate banking

• listed in the top 100 most trusted brands of India in the Brand Trust

Report

Awards and Recognitions

• Bank of the Year Money Today FPCIL Awards 2012–13

• Best Bank CNBC-TV18 India’s Best Bank and Financial Institution Awards 2012

• Best Bank Runner-up – Outlook Money Awards 2012

• 'Consistent Performer' in 'India’s Best Banks – 2012 survey' by Business Today and

KPMG

• Fastest Growing Large Bank Dun & Bradstreet – Polaris Financial Technology

Banking Awards 2012

• Fastest Growing Large Bank Business world Best Banks Survey 2012

• Best Domestic Bond House The Asset Triple A Country Awards 2012

• India Bond House of the year IFR ASIA – Country Awards 2012

• Deal Maker of the Year in Rupee Bonds Business world Magna Awards – India's Best

Deal Makers 2012

• The Best Emerging Bullion Dealing Bank 9th India International Gold Convention-

2011-12

• Best Acquiring Institution in South Asia Visa LEADER Award at Visa’s 2012 APCEMEA

Security Summit, Bali

• Gold Shield for Excellence in Financial Reporting in the Private Banks category –

2011–12 from Institute of Chartered Accountants of India

Shareholders (as on 31-Dec-2013) Shareholding

Promoter Group 33.88%

Foreign Institutional Investors (FII) 43.18%

Individual shareholders 06.61%

Bodies Corporate 06.03%

Mutual funds 04.47%

GDR 03.90%

Financial institutions / Banks 00.85%

Others 01.08%

Total 100.0%

SHAREHOLDING

34%

43%

7%

6%4%

4%

1%1%

Shareholder's Holding

Promoter Group

Foreign Institutional Investors(FII)

Individual shareholders

Bodies Corporate

Mutual funds

GDR

Financial institutions / Banks

Others

Vision 2015 and Core Values

VISION 2015:

To be the preferred financial solutions provider excelling in customer delivery

through insight, empowered employees and smart use of technology.

Core Values:

Customer Centricity

Ethics

Transparency

Teamwork

Ownership

• Treasury operations

• Retail banking

• Corporate/wholesale banking

• NRI services

• Business banking

• Investment banking

• Lending to small and medium enterprises

• Agriculture banking

Services

Introduction to IDBI BANK:

IDBI Bank Limited is an Indian financial service company headquartered Mumbai, India. RBI categorized IDBIas an "other public sector bank". It was established in 1964 by an Act of Parliament to provide credit and otherfacilities for the development of the fledgling Indian industry.

It is currently 10th largest development bank in the world in terms of reach with 1514 ATMs, 923 branchesincluding one overseas branch at DIFC, Dubai and 621 centers including two overseas centers at Singapore &Beijing.

Some of the institutions built by IDBI are the Securities and Exchange Board of India (SEBI), National StockExchange of India (NSE), the National Securities Depository Limited (NSDL), the Stock Holding Corporation ofIndia Limited (SHCIL), the Credit Analysis & Research Ltd, the Exim Bank (India)(Exim Bank), the Small IndustriesDevelopment Bank of India(SIDBI), the Entrepreneurship Development Institute of India, and IDBI BANK, whichis owned by the Indian Government.

IDBI Bank is on a par with nationalized banks and the SBI Group as far as government ownership isconcerned. It is one among the 26 commercial banks owned by the Government of India. The Bank has anaggregate balance sheet size of Rs. 2,53,378 crore as on March 31, 2011.

In March 2008, IDBI Bank entered into a joint venture with Federal Bank and Fortis InsuranceInternational to form IDBI Fortis Life Insurance, of which IDBI Bank owns 48 percent. The company endedthe year with over 300 Cr in premiums as on 31 March 2009.The name of IDBI Fortis Life Insurance is nowchanged to IDBI Federal Life Insurance Co Ltd.

Government of India now owns 65.17% stake in IDBI Bank. Hence IDBI Bank is also referred as 'The NewAge Government owned Bank'

CURRENT ACCOUNT AND SAVINGS ACCOUNT (CASA)

Current account and Saving Account chart shows No. of accounts are

increased or decreases in a year.

Here we had taken % of No. of Accounts are in a Bank.

We can see from chart in Year 2010 Axis Bank have 46.73% and IDBI

Bank have 14.59%. It means approximately IDBI bank had 1/3 accounts

compared to Axis Bank. So it is good sign for Axis Bank.

But in a next year i.e. 2011 Axis Bank’s CASA is decreased 46.73% to

41.30% and IDBI Bank’s CASA is increased to 14.59% to 20.88%. So

here we can say that IDBI Bank had Captured more customers by giving

good offers, interest rates, Services etc.

It happens continuously up to 2013 and then Axis Bank had make a

Strategy and increase their Customers by giving at Home services so in

2014 IDBI bank had loss its CASA to 22.63% and Axis Bank had increase

its CASA to 45.01%.

CURRENT ACCOUNT AND SAVING ACCOUNT (CASA) IN

%

0.005.00

10.0015.0020.0025.0030.0035.0040.0045.0050.00

2014 2013 2012 2011 2010

Am

t in

%

Years

CASA (%)

Axis Bank CASA(%)

Years 2014 2013 2012 2011 2010

Axis Bank CASA (%) 45.01 44.38 41.54 41.10 46.73

IDBI Bank CASA (%) 22.63 25.12 24.10 20.88 14.59

EARNING PER SHARE

Earning per Share indicates firm’s profitability.

Earning per Share is calculated from Profit after Tax/No. of Shares.

Here from a chart we can see that in year 2010 IDBI Bank’s EPS is

Rs.14.23 and Axis Bank’s EPS is Rs.62.06

EPS of Axis Bank is increasing continuously, because Net Profit of a Axis

Bank is increasing continuously. But in case of IDBI Bank Net Profit is

fluctuating.

Net Profit of IDBI Bank is increasing continuously from year 2010 to 2013

but in year 2014 it is declining.

Here, Axis Bank is giving more EPS to their share holder compared to

IDBI Bank.

EARNING PER SHARE IN RUPEES

0.00

20.00

40.00

60.00

80.00

100.00

120.00

140.00

2014 2013 2012 2011 2010

Am

t in

Ru

pees

Years

Earning Per Share in Rupees

Axis BankEarnings PerShare (Rs)

Years 2014 2013 2012 2011 2010

Axis Bank Earnings Per Share (Rs) 132.33 110.68 102.67 82.54 62.06

IDBI Bank Earnings Per Share (Rs) 6.99 14.12 15.89 16.76 14.23

DIVIDEND PER SHARE

Dividend is also shows profitability of a firm.

Higher profit means firm is able to pay high dividend.

Here, from this two Banks Axis Bank is giving good amount of

Dividend compared to IDBI Bank.

0.00

5.00

10.00

15.00

20.00

25.00

2014 2013 2012 2011 2010

Am

t in

Ru

pe

es

Years

Dividend Per Share in Rupees

Axis Bank DPS(Rs)

IDBI Bank DPS(Rs)

DIVIDEND PER SHARE (DPS) IN RUPEES

Years 2014 2013 2012 2011 2010

Axis Bank DPS(Rs) 20.00 18.00 16.00 14.00 12.00

IDBI Bank DPS(Rs) 1.00 3.50 3.50 3.50 3.00

RETURN ON EQUITY (ROE) IN %

0.00

5.00

10.00

15.00

20.00

25.00

2014 2013 2012 2011 2010

Am

t in

%

Years

Return on Equity (ROE) in %

Axis Bank ROE(%)

IDBI Bank ROE(%)

Years 2014 2013 2012 2011 2010

Axis Bank ROE(%) 17.43 18.53 20.29 19.34 19.15

IDBI Bank ROE(%) 5.42 10.16 13.43 15.80 13.16

CASH/DEPOSIT IN %

0.00

0.02

0.04

0.06

0.08

0.10

0.12

2014 2013 2012 2011 2010

Am

t in

%

Years

Cash/Deposit in %

Axis Bank Cash/Deposits

IDBI Bank Cash/Deposits

Years 2014 2013 2012 2011 2010

Axis Bank Cash/Deposits 0.06 0.06 0.05 0.07 0.07

IDBI Bank Cash/Deposits 0.05 0.05 0.07 0.11 0.08

CREDIT/DEPOSIT IN %

65.00

70.00

75.00

80.00

85.00

90.00

2014 2013 2012 2011 2010

Am

t in

%

Years

Credit/Deposit in %

Axis Bank Credit/Deposits(%)

IDBI Bank Credit/Deposits(%)

Years 2014 2013 2012 2011 2010

Axis Bank Credit/Deposits(%) 81.89 77.97 77.13 75.25 73.84

IDBI Bank Credit/Deposits(%) 83.85 86.43 85.79 87.04 82.43

NET PROFIT IN RUPEES CRORES

0

1000

2000

3000

4000

5000

6000

2014 2013 2012 2011 2010

Am

t in

Ru

pe

es

Cro

res

Years

Net Profit in Rupees Crores

Net Profit for the Year For AxisBank in Rupees Crore

Net Profit for the Year For IDBIBank in Rupees Crores

Years 2014 2013 2012 2011 2010

Net Profit for the Year For Axis Bank

in Rupees Crore 0 5,179.43 4,242.21 3,388.49 2,514.53

Net Profit for the Year For IDBI Bank

in Rupees Crores1,121.40 1,882.08 1,894.34 1,650.32 1,031.13

NET INTEREST INCOME/TOTAL FUNDS IN %

0

1

2

3

4

5

6

2014 2013 2012 2011 2010

Am

t in

%

Years

Net Interest Income / Total Funds in %

Net Interest Income / TotalFunds For Axis Bank in %

Net Interest Income / TotalFunds For IDBI Bank in %

Years 2014 2013 2012 2011 2010

Net Interest Income / Total Funds For Axis

Bank in % 3.3 3.09 3.04 3.1 5.34

Net Interest Income / Total Funds For IDBI

Bank in %1.85 1.76 2.4 2.39 2.02

CURRENT RATIO IN %

0

0.005

0.01

0.015

0.02

0.025

0.03

0.035

2014 2013 2012 2011 2010

Am

t in

%

Years

Current Ratio in %

Current Ratio of Axis Bank in %

Current Ratio of IDBI Bank in %

Years 2014 2013 2012 2011 2010

Current Ratio of Axis Bank in % 0.03 0.03 0.03 0.02 0.03

Current Ratio of IDBI Bank in % 0.03 0.03 0.02 0.02 0.03

QUICK RATIO IN %

0

5

10

15

20

25

30

2014 2013 2012 2011 2010

Am

t in

%

Years

Quick Ratio in %

Quick Ratio of Axis Bank in %

Quick Ratio of IDBI Bank in %

Years 2014 2013 2012 2011 2010

Quick Ratio of Axis Bank in % 18.57 20.1 21.63 19.6 19.19

Quick Ratio of IDBI Bank in % 23.11 24.82 27.11 26.78 19.49

CAMEL Analysis

A technique, used to rate banks on various parameters based on financial and non-

financial performance.

Each letter refers to the specific category of performance

C = Capital Adequacy A = Assets quality

M = Management quality E = Earnings

L = Liquidity

A-CAPITAL ADEQUACY

It indicates the bank’s capacity to maintain capital commensurate with the nature and

extent of all types of risks, as also the ability of the bank’s managers to identify, measure,

monitor and control these risks.

There are 3 ratios have been used to analyze the capital adequacy of the bank

Capital Adequacy ratio

Debt-equity ratio

Credit extended ratio

(1) Capital Adequacy Ratio

Formula=Total capital/Risk-weighted assets

201403 201303 201203 201103 201003

Axis(%) 16.97 17.00 13.66 12.65 15.80

IDBI(%) 13.13 13.13 14.58 13.64 11.31

16.97 17.00

13.6612.65

15.80

13.13 13.1314.58

13.64

11.31

Ax

is T

itle

Capital Adequacy Ratio

Interpretation

This ratio shows how the management has maintained the capital commensurate to the risks, and also the ability of management

to identify, monitor and measure the risks. Higher the ratio less is the risk. Here Axis Bank has higher capital adequacy ratio than

the IDBI Bank in the year 2013-14 and therefore carry less risks.

(2)Debt Equity Ratio

Formula= Total debt/total equity

201403 201303 201203 201103 201003

Axis(%) 7.35 7.63 9.65 9.96 8.81

IDBI(%) 9.97 10.7 11.98 14.24 20.38

7.35 7.639.65 9.96 8.819.97 10.7 11.98

14.24

20.38

Ax

is T

itle

Debt Equity Ratio

A measure of a company's financial leverage calculated by dividing its total liabilities by stockholders' equity. It indicates

what proportion of equity and debt the company is using to finance its assets.

Note: Sometimes only interest-bearing, long-term debt is used instead of total liabilities in the calculation.

Also known as the Personal Debt/Equity Ratio, this ratio can be applied to personal financial statements as well as

corporate ones.

A - Assets qualityAsset quality determines the robustness of financial institutions against

loss of value in the assets. The deteriorating value of assets, being prime source

of banking problems, directly pour into other areas, as losses are eventually

written-off against capital, which ultimately jeopardizes the earning capacity of

the institution..

Following ratios can be used to analysis Assets Quality of the bank:

•Net NPAs to Advances Ratio

•Net NPAs to Total Assets Ratio

Net NPAs to Advances Ratio

201403 201303 201203 201103 201003

Axis(%) 0.44 0.36 0.27 0.29 0.40

IDBI(%) 2.48 1.58 1.61 1.06 1.02

0.44 0.36 0.27 0.29 0.40

2.48

1.58 1.61

1.06 1.02

Ax

is T

itle

Net NPAs to Advances Ratio

Interpretation

The net NPA to advances ratio is used to measure of the overall quality of the bank’s loan book. Higher ratio

reflects rising bad quality of loans.

Ratio of IDBI is increasing highly each year where as ratio of Axis is increasing in slow rate. Ratio of IDBI is

higher than ratio of Axis in the year 2014 which shows that IDBI have higher amount of bad quality of loans.

M - Management Quality

Management of financial institution is evaluated in terms of compliance with set norms,

ability to plan and react to changing circumstances, technical competence, leadership and

administrative ability.

Following ratios can be calculated to analyze Management Quality of the bank:

• Return on Equity

• Efficiency Ratio

• Advances to Deposits Ratio

• Income Productivity Per Employee

Return on Equity(ROE)

Formula=Net Profit/Equity

201403 201303 201203 201103 201003

Axis 17.43 18.53 20.29 19.34 19.15

IDBI 5.42 10.16 13.43 15.80 13.16

17.43 18.5320.29 19.34 19.15

5.42

10.16

13.4315.80

13.16

Ax

is T

itle

Return on Equity(ROE)

InterpretationReturn on equity (ROE) measures the rate of return on the ownership interest (shareholders' equity) of the common stock

owners. It measures a firm's efficiency at generating profits from every unit of shareholders' equity (also known as net

assets or assets minus liabilities). ROE shows how well a company uses investment funds to generate earnings growth.

ROEs between 15% and 20% are generally considered good. The performance of Axis is better than IDBI.

E - Earnings

Earnings and profitability, the prime source of increase in capital base, is examined with

regards to interest rate policies and adequacy of provisioning. In addition, it also helps

to support present and future operations of the institutions. The single best indicator

used to gauge earning is the Return on Assets (ROA), which is net income after taxes to

total asset ratio.

201403 201303 201203 201103 201003

Axis 1.72 1.65 1.61 1.60 1.53

IDBI 0.34 0.61 0.75 0.68 0.51

1.72 1.65 1.61 1.60 1.53

0.340.61

0.75 0.680.51

Ax

is T

itle

Return on Assets( ROA )

Return on Assets( ROA )Formula=Net Profit/Total Assets

Interpretation

The return on assets (ROA) percentage shows how profitable a company's assets are in generating revenue. This number

tells what the company can do with what it has, i.e. how many dollars of earnings they derive from each dollar of assets

they control. It's a useful number for comparing competing companies in the same industry. The number will vary widely

across different industries. Return on assets gives an indication of the capital intensity of the company, which will depend

on the industry; companies that require large initial investments will generally have lower return on assets. Axis is a better

performer when ROAs of the two years are compared.

Profit marginFormula=Net Profit/Total income

201403 201303 201203 201103 201003

Axis 16.34 15.35 15.47 17.12 16.1

IDBI 3.79 6.65 7.99 8.12 5.95

16.3415.35 15.47

17.1216.1

3.79

6.65

7.99 8.12

5.95

Ax

is T

itle

Profit Margin

INTERPRETATION

Profit margin, net margin, net profit margin or net profit ratio all refer to a measure

of profitability. It is calculated by finding the net profit as a percentage of

the revenue. The profit margin is mostly used for internal comparison. It is difficult

to accurately compare the net profit ratio for different entities. Individual

businesses' operating and financing arrangements vary so much that different

entities are bound to have different levels of expenditure, so that comparison of one

with another can have little meaning. A low profit margin indicates a low margin of

safety: higher risk that a decline in sales will erase profits and result in a net loss,

or a negative margin. Profit margin is an indicator of a company's pricing strategies

and how well it controls costs. Differences in competitive strategy and product mix

cause the profit margin to vary among different companies.

Here the profit margin of Axis has been increasing over the last three years but in

case of IDBI it has been decreasing. Profit margin of Axis is higher than Profit

margin of IDBI in 2014.

Earning per shareFormula=Net Profit/Number of equity shares

201403 201303 201203 201103 201003

Axis 132.33 110.68 102.67 82.54 62.06

IDBI 6.99 14.12 15.89 16.76 14.23

132.33

110.68102.67

82.54

62.06

6.99 14.12 15.89 16.76 14.23

Ax

is T

itle

Earning per share

INTERPRETATION

The portion of a company's profit allocated to each outstanding share of

common stock. Earnings per share serve as an indicator of a company's

profitability. When calculating, it is more accurate to use a weighted average

number of shares outstanding over the reporting term, because the number of

shares outstanding can change over time. However, data sources sometimes

simplify the calculation by using the number of shares outstanding at the end

of the period.

Axis has higher earnings per share than IDBI over the last two years. Axis is

better than IDBI in Earning per Share.

L - Liquidity

An adequate liquidity position refers to a situation, where institution can obtain sufficient

funds, either by increasing liabilities or by converting its assets quickly at a reasonable

cost. It is, therefore, generally assessed in terms of overall assets and liability management, as

mismatching gives rise to liquidity risk. Efficient fund management refers to a situation

where a spread between rate sensitive assets (RSA) and rate sensitive liabilities (RSL) is

maintained.

Cash to Deposits Ratio

201403 201303 201203 201103 201003

Axis 0.06 0.06 0.05 0.07 0.07

IDBI 0.05 0.05 0.07 0.11 0.08

0.06 0.060.05

0.07 0.07

0.05 0.05

0.07

0.11

0.08

Ax

is T

itle

Cash to Deposits Ratio

Interpretation

Cash deposit ratio is the amount of money a bank should have available as a percentage of the total amount of money its

customers have paid into the bank. This amount is calculated so that customers can be sure that they will be able to take

their money out of the bank if they want to.

Axis have better cash to deposits ratio than IDBI.

Other Ratios

Cost of funds(%)

201403 201303 201203 201103 201003

Axis 4.88 5.14 4.89 3.54 3.67

IDBI 6.25 6.10 6.48 5.63 5.57

4.88 5.14 4.89

3.54 3.67

6.25 6.106.48

5.63 5.57

Ax

is T

itle

Cost of funds

Interpretation:

This ratio shows the interest paid with respect to the funds borrowed from the lenders. Here the cost of

borrowing funds for IDBI is higher than the Axis Bank.

(6) Dividend Per Share

Formula=Dividend paid/Number of equity shares

201403 201303 201203 201103 201003

Axis 20.00 18.00 16.00 14.00 12.00

IDBI 1.00 3.50 3.50 3.50 3.00

20.0018.00

16.0014.00

12.00

1.00 3.50 3.50 3.50 3.00

Ax

is T

itle

Dividend per Share

Interpretation:

Dividend per share (DPS) is the total dividends paid out over an entire year (including interim dividends but

not including special dividends) divided by the number of outstanding ordinary shares issued. DPS of Axis is

higher than IDBI in all the years which shows that Axis is better.