City Bank vs Southeast Bank Financial Performance Analysis

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Introduction

This is a report of performance analysis of the company entitled City Bank. The ratio analysis will help to compare the financial performance of the company, with Southeast Bank Limited. The period of analysis is from 2004 to 2009. The performance of City Bank has been analyze in terms of

➢ Liquidity

➢ Leverage

➢ Activity (efficiency)

➢ Profitability

➢ Market Position

I have selected City Bank because it has been one of the leading banks in the banking industry of Bangladesh. It has always given priority to its customers and has served them with various customized products & services. It has also shown commitments on a consistent basis through different part of the society as a CSR activity. Thus, I have decided to choose City Bank as our subject of concern.

Objectives

The objective of this report is to analyze the financial performance of City Bank from the years 2004 to 2009 and compare with Southeast Bank Limited financial performance. Ratios have been used as an instrument to analyze the financial performance of the bank. But that is not all I will provide with explanations for the financial performance of the company and its competitor whether it performance is satisfactory or not compare to its competitor. This will allow a greater insight into both the company and also the industry where it operates. I will also recommend on what needs to be done for the improvement of the bank. This analysis will help investors to decide on whether to invest their money in City Bank or not. The objective of a company is to maximize shareholder’s wealth. I will identify on behalf of the investors whether the company is actually directing toward its objective by using ratio analysis. This report will also allow me to get some practical experience regarding the financial evaluation using ratio analysis. This will prove useful in the future, when I will be in the practical field.

Methodology

The purpose of my term paper is analyze the performance of City Bank and compare its performance with Southeast Bank Limited .The project starts with

← Data Collection

This term paper is based on Secondary Data. The main sources in conducting this research were the bank’s annual report, DSE Library, selected reference books, local texts books about bank management, credit risk rating report of City Bank and journals on the internet.

← Quantitative Analysis

I have conducted a Quantitative Analysis. Various types and classes of ratios were used in evaluating performance of City Bank. According to the plan I calculated all the ratios by taking require information from its financial reports. Almost all of those ratios were taught in our class; moreover I have collected some from internet.

← Application Software used: Microsoft Excel, Microsoft word.

Limitation

❖ As I am dealing with a local bank some local ratios needed to be given as the text books we follow only talk about American ratios. So we had to us so local books and journals which I must say was extremely hard to locate.

❖ While doing the project I had to face a problem that all of the data of all of the years are not stated using the same terms. So I found it somewhat difficult to understand to some of the cases because all of the terms are not similar to our text book.

❖ Although it was very difficult to me to complete the whole project within very short period, I did give my hundred percent to finish my project on time and in a presentable manner. If I had enough time, I will make the report with more compatible financial analysis.

❖ Major ratio analysis limitation is that ratio analysis does not take into account the effect of inflation. Sometimes profit figures are increasing due to inflationary factors rather than an increase in sales. But the analysis will show an improved performance by the company which is clearly...
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