1.1 BACKGROUND OF THE STUDY
For the past fifteen years Ecobank Ghana Limited has been consistently been at the forefront of Ghana Banking Industry. It has won more domestic recognition than more of its much older competitors; grown into what was hitherto Ghana’s largest merchant bank; and gone on to become one of the first bank in the country to become universal bank, offering commercial as well as merchant banking products and services. Ecobank Ghana Limited has nearly monopolized the most converted bank of the year award conferred annually at the Ghana Banking Awards. The bank has won this prestigious award for five times in the years 2001, 2002, 2003, 2005 and 2006. These achievements of Ecobank Ghana Limited were made possible by analysis of its financial performance.
The impact of financial analysis on the performance of the banking industry has been discussed and debated upon by many scholars in the field of finance. Researchers have adopted measures like analyzing the relationship between organizations investment in human resources development and their performance in analysis financial performance.
Financial statement analysis can be a yardstick to measure an organization’s level of productivity and the level of contribution it should supposedly make to the development of an economy, all other things been equal. Critical assessment and analysis of financial performance should be the concern of any individual or group of people running financial institutions.Wild, Bernstern and Subramanyam (2001), defines financial statement analysis as the application of analytical tools and techniques to general-purpose financial statements and related data to derive estimates and inferences useful in business analysis. Thus financial statement analysis involves the use of simple and mathematical techniques, an understanding of accounting and appreciation of business strategy to gain insight into the reporting company’s history,... [continues]
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