A STUDY ON OPERATIONAL AND FINANCIAL

PERFORMANCE OF CANARA BANK,

MANGALORE

STUDENT NAME:SHRIVATHSA K
REGISTER NO: 17YUCMD189

GUIDE NAME: PROF. HEENA KOSAR

ABBS Bangalore
 COMPANY PROFILE:

Canara bank is one of the largest public sector banks which is owned by Government of
India whose headquarters located in Bengaluru, Karnataka. It was established in the year
1906 by Ammembal Subba Rao Pai in Mangalore. It was one of the oldest public sector
banks in India. It also has its branches in other countries like, London, Moscow, Doha,
South-Africa, Bahrain, Dubai, Tanzania and New York.
Canara Bank has several first to its crown. These include,
 Launching of Inter-City ATM Network.

 Obtaining ISO Certification for a branch.

 Articulation of ‘Good Banking’- banks citizen charter.

 Launching of Exclusive Subsidiary for IT Consultancy.

 Providing Agricultural Consultancy Services.

 RATIO ANALYSIS
 Ratio analysis is one of the approaches of financial analysis in which ratios
are used as a parameter for evaluating the financial state and performance
of a firm. It was pioneered by Alexander Wall who introduced a system of
ratio analysis in the year 1909.

Financial Aspects of Canara Bank:

 Canara banks growth in the financial year 2017-18 reflects the changing
liquidity position of the bank. And in the year 2017-18 the asset quality of
every bank was under stress which led to the profitability of the banks.
 Operating profit of the bank increased from ₹8914 crores in 2016-17 to
₹9548 crores in the year 2017-18.
 Canara bank reported a net loss of ₹4222crores in 2017-18 compared to a
net profit of ₹1122 crores in previous year.
 Net interest income of the bank increased by 23.21% to ₹12163 crores
compared to previous years ₹9872 crores.
 To study the operational performance of
Canara bank.
 To understand the financial performance of
the Canara bank.
 To study and analyze the financial statements
of the bank.
 The data attained for the study of the project includes secondary source of data.
The secondary data is attained through various sources like fact sheets, balance
sheets, newspapers, magazines and information seemed from the Canara bank
websites.
 Research methodology is the structured way of analyzing the research problem. It
means the way in which we conduct the research process. Before undertaking of
such task or process it is very essential to determine the problem which we are
going to study. They have adopted the following steps to do my research or
study:

 Formulating the research problem.

 Research design.

 Determining the data sources for the study.

 Analyzing of data.

 Interpretation of the data collected.

 To evaluate the various ratio analysis involved in
the firm.

 To calculate liquidity, solvency, profitability and

activity ratios of the organization.

 To make a comparative study and give solutions

for the organizational improvement.
 Ratio analysis is one of the most important techniques to measure the profitability and capital
structure. The findings of this study have been narrated as under:
 Return on Equity: This ratio was highest in Dena Bank, if we considered average of the last five
years that is financial year 2013-2014 to 2017-2018. Average of this ratio was lowest i.e.
10.63 percent.
 Net Profit Margin: During the period of study average highest NPM found in axis bank i.e.
14.87 percent and lowest average NPM in Canara Bank it was 8.47 percent. During the period
of study NPM showing different tendency during first two years it was found highest in BOI i.e.
13.96 percent and 15.89 percent.
 Return on Long Term Fund: Among sample units Canara bank secured first position with best
return on long term fund while Axis bank listed at last because of that continues poor
performance.
 (4) Net Profit to Total Fund: During the study period average highest net profit to total fund in
KMB i.e. 1.52 percent and lowest average net profit to total fund in IVB it was 0.81 percent.
Net profit to total fund in Canara bank is 0.9.
 Total Income to Capital Employed: This ratio was highest in KMB if we considered average of
the last five years that is financial year 2013-14 to 2017-18. Average of this ratio was lowest
in BOB i.e. 8.17 percent.
 There are some suggestions derived from doing the analytical study of the financial
performance of the selected banks. As such this chapter offer new suggestions for the
increasing profitability and proper capital structure decision of banking industry in
India.
 The return on equity for private sector banks is less than that of public sector
banks. So, I will suggest to private sector banks to improve their profitability. Thus
private sector banks are required to increase their profit after tax to satisfy the
shareholders with adequate return.
 The public sector banks are moving back in the sequence of earning per share
ratio. It is necessary for public sector banks to reduce their operating expenses and
NPA to increase the profit. So, as they can increase earning per share up to the
mark.
 In private sector banks return on long term fund found poor as compared to public
sector banks. It is necessary for the private sector banks to utilize their long term
fund very effectively to generate enough return. So, as they can compete to public
sector banks.
 An appropriate mix of capital structure should be adopted in order to increase the
profitability of banks.
 Banks should concentrate more on internal sources rather than external sources of
financing in order to increase their profitability.
 To conclude, it can be said that
 Private Sector Banks profitability is much higher than that of Public Sector Banks.
 It is clear from the analysis that the public sector banks are less profitable than the
private sector banks in terms of overall profitability.
 All these developments in Indian banking says that, the Indian banks are moving
towards modern banking changing a face of traditional banking of Indian economy.
It is great change of banking industry.
 Indian banks also trying to Universalization of banking products and services to
one top banking shop for customer delight, but comparatively private and foreign
banks existing in Indian economy are having a higher level of modernization and
those providing numbers of modern services to their customers.
 For a long term success of banking institution to require effective management of
credit risk and diversified into fee based activities. Non-traditional activities of
banks are more sophisticated and versatile instrument for risk assessment.