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Indian Banking Sector – Some Uncommon Figures & Ratios
This blog is in continuation to our blog series on Banking sector, where we have tried to explain the Banking sector as whole from scratch (explaining the terms and jargons) and have deep dived into how Indian Banking sector has evolved over decades. In the current blog we focus on the ‘not-so-trivial’ data points of banks, which are commonly not looked at, but are worth looking at!
Note: All the data is as of 31st March 2018 / FY 18, unless specified.
Fee Income Of A Bank
Fee Income As % Of Total Income
We can see how all the PSU Banks have had weaker Fee Income as share of Total Income compared to their private peers.
Fee Income per Employee
Banking Sector being a service industry, productivity of the employee is a key variable to track. We can see how productivity of PSU bank employees have been. However, there are few private banks as well who have lower Fee Income per Employee as of FY18.
Bancassurance Of A Bank
Bancassurance is selling of life assurance and other insurance products and services by banks. This is another higher yield product for banks. Higher the better!
We can see how some of the most valued banks have better performance in terms of Retail Advances.
Retail Advances per Employee (Rs cr)
Better CASA numbers by top private banks has helped them achieve lower cost of funds and hence maintain better NIMs.
Net Interest Income Per Employee
Operating Expense per Branch
We can see how the top performing private banks have higher operating expenses per branch! These banks are continuously investing to sustain their growth rates.
Employees per Branch
We can also see how the top performing private banks have higher employees per branch! i.e. higher sales force, customer service executives etc. Top private banks have double employees per branch compared to their PSU peers. Banking is the only sector where the PSU companies have lesser employees than their private counterparts!
Leverage (Advances/Net Worth)
The following chart describes how many times its Net Worth is the respective bank’s Advances.
Market Cap / Advances
The following chart describes how many times is the market valuing the bank’s loan book.
It is basically the ROA of a bank assuming zero Provisioning for the bank.
Pre-Provisioning ROA = [Report PAT + (Provisioning)*(1 – tax)] / [Total Assets]
Debit & Credit Card
The higher the number of credit and debit cards, better is the bank’s fee income. HDFC Bank has more credit cards than entire PSU banking sector combined!
|Bank||No Of Debit Cards Issued (May-18)||No Of Credit Cards Issued (May-18)|
|State Bank of India||28.3 cr||65 lacs|
|Bank of Baroda||5.3 cr||1.3 lacs|
|Punjab National Bank||6.4 cr||3.3 lacs|
|Canara Bank||4.5 cr||2.2 lacs|
|Central Bank Of India||3.0 cr||96,000|
|Indian Bank||1.8 cr||85,000|
|Bank Of India||5.4 cr||2.1 lacs|
|Union Bank Of India||2.2 cr||2.2 lacs|
|Vijaya Bank||65.6 lacs||62,000|
|HDFC Bank||2.5 cr||1.1 cr|
|Kotak Mahindra Bank||0.9 cr||15.5 lacs|
|ICICI Bank||4.3 cr||52 lacs|
|Axis Bank||2.3 cr||46 lacs|
|IndusInd Bank||0.4 cr||8.2 lacs|
|Yes Bank||0.2 cr||3 lacs|
|Bandhan Bank||1.1 cr||NA|
|Federal Bank||0.7 cr||NA|
|Karur Vysya Bank||0.4 cr||NA|
|City Union Bank||18.1 lacs||5,500|
Exposure Towards Various Sectors
Below we have shown credit exposure of each bank towards different sectors, wherever the data was available.
Interestingly, almost ~25% of ICICI Bank’s book comprises of home loans.
HDFC Bank is most aggressive when it comes to Auto Loans, with over 10% of its book comprising of Auto Loans. We can see, the top private banks have higher portion of exposure towards auto loans compared to their PSU peers.
Iron & Steel Sector
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