The Transformation Of Sbi Finance Essay

Since 1980s, the State Bank of India had been losing market portion steadily for more than two decennaries. The market portion of SBI in the Indian banking sector declined from 35 % in 1970s to 15 % in 2006. Analysts and industry perceivers had predicted that at the ICICI bank would catch SBI in footings of sedimentations by 2010. Public viewed SBI as a classical old type banking establishment and it was non seen as a leader in merchandise invention, selling or distribution. The motive degrees of employees were low and the client satisfaction degrees had declined significantly. The bank lacked needed engineering platform as compared to private Bankss. In short, the bank did non hold a proper mission and vision for the hereafter.

However, under the leading of Shri O P Bhatt, SBI underwent transmutation to recover its place in the Indian banking sector within five old ages ( 2006-2011 ) . By 2010, SBI had more than doubled its sedimentations and net incomes. It besides won the Asian Bank Achievement award for the strongest bank in the Asia Pacific Region.

Overview

In 2011, SBI was the largest commercial bank in India with market capitalisation of over $ 36.5 billion. With the support of Indian authorities, the bank expanded quickly between 1960 ( 500 subdivisions ) to 1990 ( 8000 subdivisions ) . It played an indispensable function in the development of rural parts in India, supplying funding to the agricultural industry.

SBI was the first penchant for most of the Indians which was apparent by the fact that irrespective of the lower involvement rate ( as compared with other Bankss ) people deposited money chiefly in SBI. It besides indicates that the client satisfaction degree was good as compared to post offices and other nationalized Bankss. It was market leader in both sedimentations and loans.

SBI was besides considered as one of the best employers in India. It recruited some of the best endowments in India over the old ages.

However, with the rapid enlargement, the bank witnessed diminution in the public presentation. Alternatively of concentrating on profitableness, the bank focused more on societal policies of the authorities. More accent was given to increasing the figure of subdivisions alternatively of bettering the client satisfaction or concern development. As a consequence of which the client satisfaction degrees declined aggressively. SBI was non managing human resource decently. The bank staffs were blowing most of their clip making manual and paper intensive undertakings alternatively of concentrating on client gross revenues and service.

In the 1990s, SBI switched from a manual leger system to computerise back office operations. However, these subdivisions were runing on their ain independent waiters and had no nexus to other subdivisions.

In 1990, the Indian bank sector witnessed entry of many private and foreign Bankss such as HDFC, ICICI, HSBC, etc. The new entrants initiated a new epoch in Indian banking through their big investings in engineering and client service. They introduced the construct of remote banking through phone and cyberspace banking. Better client service and better engineering enabled these Bankss to win clients from the bing nationalized Bankss such as SBI.

By 2006 SBI ‘s market portion had fallen to 15 % . Its evaluations as per Banker magazine had fallen from 82 in 2004 to 107 in 2006. SBI was impotently watching these Bankss win market portion in the Indian banking sector. SBI needed a new leader with vision to win back its place in the Indian banking sector.

About SBI and the Indian Banking Sector

A brief history

State Bank of India, the largest state-owned banking and fiscal services company in India has its roots in Bank of Calcutta established in 1806 which subsequently came to be known as Bank of Bengal. It shortly was granted the position of presidential term bank. Soon two more presidential term Bankss were established Bank of Bombay and Bank of Madras. Their chief map was to publish currency and assist the authorities of India rise loans and provide stableness to authorities security monetary values. In 1921 the three presidential term Bankss were merged to organize the Imperial Bank of India which functioned as a commercial bank, a banker ‘s bank and a banker to the authorities. The constitution of the Reserve Bank of India as the cardinal bank of the state in 1935 ended the quasi-central banking function of the Imperial Bank. The authorities decided to make a province owned bank by taking over IBI and incorporating with it the former province owned Bankss. An act was consequently passed in Parliament in May 1955 and the State Bank of India was constituted on 1 July 1955.

The State Bank of India therefore started with a new sense of societal intent aided by the 480 offices consisting subdivisions, bomber offices and three Local Head Offices inherited from the Imperial Bank. The construct of banking changed from mere depositories of the nest eggs and loaners to creditworthy parties to the construct of purposeful banking sub-serving the turning fiscal demands of economic development. The State Bank of India was destined to be the leader in this regard and take the Indian banking system into the exciting field of national development.

Business Model

In add-on to banking, SBI ‘s concern theoretical account is based on the undermentioned services:

aˆ? Life insurance

aˆ? Merchant banking

aˆ? Mutual financess

aˆ? Credit card

aˆ? Factoring

aˆ? Security trading

aˆ? Pension fund direction

aˆ? Custodial services

aˆ? General insurance ( non-life insurance ) and

aˆ? Primary franchise in the money market

The Bank operates in four concern sections:

aˆ?Treasury: The Treasury section includes the investing portfolio and trading in foreign exchange contracts and derivative contracts.

aˆ?Corporate/Wholesale Banking: The Corporate/ Wholesale Banking section comprises the loaning activities of Corporate Accounts Group, Mid Corporate Accounts Group and Stressed Assets Management Group.

aˆ?Retail Banking: The Retail Banking section consists of subdivisions in National Banking Group, which chiefly includes personal banking activities, including loaning activities to corporate clients holding banking dealingss with subdivisions in the National Banking Group. SBI provides a scope of banking merchandises through their huge web of subdivisions in India and overseas, including merchandises aimed at NRIs.

aˆ?Other banking services.

Indian Banking sector

The Indian banking has a big history, which covers the traditional banking patterns from the clip of British India to the reforms period, nationalisation to denationalization of Bankss and now increasing Numberss of foreign Bankss in India. Indian Banking industry has achieved a new tallness with the altering times. The usage of engineering has been radical in the on the job manner of the Bankss but the cardinal facets of banking i.e. trust and the assurance of the people on the establishment remain the same. The bulk of the Bankss are still successful in maintaining with the assurance of the stockholders every bit good as other stakeholders. However, with the altering forces in banking concern, Bankss are exposed to new sort of hazard.

In the past twosome of old ages, the Indian banking sector has been extremely resilient in the face of high domestic rising prices, rupee depreciation and financial uncertainness in the US and Europe. In order to excite the economic system and back up the growing of banking sector, the Reserve Bank of India adopted terrible policy steps such as increasing the cardinal pecuniary policy rates such as repo and change by reversal repo 16 times since April 2009 to Oct 2011 and fastening provisioning demands. Amidst this economic scenario, the cardinal challenge for the Indian banking system continues in bettering their operational efficiency and hazard direction patterns. By 2010, banking in India was by and large reasonably mature in footings of supply, merchandise scope and range. In footings of quality of assets and capital adequateness, Indian Bankss are considered to hold clean, strong and crystalline balance sheets relative to other Bankss in comparable economic systems in its part. The Reserve Bank of India is an independent organic structure, with minimum force per unit area from the authorities. The declared policy of the Bank on the Indian Rupee is to pull off volatility but without any fixed exchange rate-and this has largely been true.

Since the growing in the Indian economic system expected to be strong for rather some time-especially in its services sector-the demand for banking services, particularly retail banking, mortgages and investing services are expected to be strong. One may besides anticipate Mergers & A ; Acquisitions, coup d’etats, and plus gross revenues. With the acceptance of engineering, the Indian banking sector has undergone important transmutation from local subdivision banking to anywhere-anytime banking. Over the past twosome of old ages, there has been immense growing registered in the figure of minutess done through nomadic devices. In order to prolong the concern growing amid extremely competitory market and decelerating Indian economic system, Bankss are likely to spread out in the abroad market. They will seek to tap emerging chances by spread outing into newer markets such as Africa, former Soviet part and other South East Asiatic states, in which India has maintained good trade dealingss. They can put up confined operations or expand through inorganic agencies by undergoing M & A ; A with Bankss in foreign states. However, high capital cost for puting up foreign operations can move a hindrance in the manner of enlargement.

Regulatory Framework

The Reserve Bank takes timely enterprises to guarantee that the regulative model for the banking industry is on a regular basis updated as per the development of the fiscal system, cut down opportunities of regulatory/ supervisory arbitrage and inordinate hazard taking. Besides higher capital adequateness ratio and demand of statutory liquidness buffers in the signifier of Cash Reserve Ratio ( CRR ) and Statutory Liquidity Ratio ( SLR ) , Bankss are capable to regulative norms refering to concentration hazards, capital market exposure, inter-bank exposures, and external debt intermediation. Banks ‘ exposure to derived functions have besides been brought under the scope of capital adequateness government with prescriptions on usage of recognition transition factors linked to the adulthoods of involvement rate and exchange rate contracts. The Reserve Bank has already put in topographic point a monitoring mechanism to capture the ‘contagion hazard ‘ within fiscal pudding stones as besides its cumulative exposure to specific outside entities, sectors and market sections from the point of position of assorted concentration hazards confronting the pudding stones. Assorted sections of the RBI are mostly responsible for the supervising of the banking industry in India. The board for fiscal supervising was set up under the RBI to maintain a close ticker on the fiscal markets and oversee it efficaciously to forestall the happening of a fiscal crisis. As the nature of fiscal markets and fiscal instruments go progressively complex, the function of supervisors for the banking industry has assumed greater importance.

The supervisory procedure is centred on assorted signifiers of reviews. They can be loosely classified into on site and off site review processes. Off-site monitoring processes involve the analysis of a bank ‘s public presentation based mostly on its financials. When set abouting on-site reviews of Bankss, focal point is laid on the nucleus appraisals based on the CAMELS theoretical account ( and CALCS theoretical account for foreign Bankss ) . The frequence and focal point of such reviews are modified on a instance to instance footing. On-site reviews efficaciously supplement the off-site review processes to finish the monitoring mechanism applicable to Bankss in India. But, these procedures were non considered equal, as the concern has developed significantly over the old ages.

Importantly, India has implemented the Risk Based Supervision ( RBS ) model which evaluates the hazard profile of the Bankss through an analysis of 12 hazard factors, of which are eight concern hazards and four control hazards. The eight concern hazards relate to capital, recognition hazard, market hazard, net incomes, liquidness hazard, concern scheme and environment hazard, operational hazard and group hazard. The control risks relate to internal controls hazard, organisation hazard, direction hazard and conformity hazard. The RBS model is presently undergoing further polish by the RBI, and can be expected to be undertaken on a larger graduated table.

SWOT Analysis

Strengths

Brand name

SBI Bank is the oldest bank in India, established in 1806

Wide Distribution Network

Excellent incursion in the state with more than 10000 nucleus subdivisions and more than 5100 subdivisions of associate Bankss.

Diversified Portfolio

SBI has a full scope offerings that can be offered to new and bing clients.

Government Owned

Government owns 60 % interest in SBI. This gives SBI an border over private Bankss in footings of client security.

Failing

Hierarchical Structure

The bing hierarchal direction construction of the bank is a barrier to alter.

High Non Performing Assetss

The highest Non Performing Assetss ( NPAs ) in the industry.

Lack of Modernization

SBI lags with regard to private participants in footings of modernization of its procedures, substructure, centralization, etc.

Opportunity

Increasing Trade:

Increasing trade and concern dealingss and a big figure of expatriate populations offers a great chance.

Turning Economy:

The economic system turning quickly would take to an addition in the sum of sedimentations and progresss for SBI.

Untapped market sections:

There is farther range in sections such as rural India, immature coevals etc.

Amalgamations with Associate Banks:

Amalgamation of all the associate Bankss into SBI will make a immense bank which streamlines operations and unlocks value.

Global Expansion:

SBI has already expanded globally and started its operations internationally in 32 states like Australia, Bangladesh etc. and it has been really profitable. Thus future enlargement in other planetary markets should be planned.

Menace

Consumer Expectations:

Consumer outlooks have increased many creases and necessitate effectual and speedy services.

Advent of MNC Banks:

Large Numberss of MNC Bankss are mushrooming in the Indian market due to the friendly policies adopted by the authorities. This can increase the degree of competition and turn out a possible menace for the market portion of SBI bank.

Employee Strikes:

There was an employee work stoppage in the twelvemonth 2006 which disrupted SBI ‘s activities. This might go on once more in the hereafter if the employees are non taken attention of.

Pvt. Banks – Retail Banking:

Private Banks have started embarking into Retail Banking in the rural and semi-urban sector, which used to be the bastion of the State Bank and other PSU Bankss.

Porters 5 forces of the Indian Banking sector

1. Competitive Competition: High

Top Performing Public Sector Banks

Andhra Bank

Allahabad Bank

Top Performing Private Sector Banks

HDFC Bank

ICICI Bank

Top Performing Foreign Banks

Citibank

Standard Chartered

The banking industry is extremely competitory. The fiscal services industry has been around for 100s of old ages and merely about everyone who needs banking services already has them. Because of this, Bankss must try to entice clients off from competitor Bankss. They do this by offering lower funding, preferred rates and investing services. The banking sector is in a race to see who can offer both the best and fastest services.

2. Buyer Power: High

With the outgrowth of larger figure of participants in the Banking Industry, the exchanging cost of the purchaser has gone done significantly. The burden is now on the effectivity and velocity with which the services are provided to the clients. Financial establishments – by offering better exchange rates, more services, and exposure to foreign capital markets -work highly difficult to acquire high-margin corporate clients.

3. Supplier Power: Low

The providers of capital do non present a large menace, but the menace of providers taking off the human resource. If a gifted person is working in a smaller regional bank, there is the opportunity that individual will be enticed off by bigger Bankss, investing houses, etc.

4. Menace of New Entrants: Low

Get downing a bank in a state like India is non every bit easy as any other industry, but if anew bank is started that is chiefly targeted on Niche Segments might present a menace to SBI. The new entrants from a different state are ever discouraged to take portion in the fiscal and banking sector by regulative reforms restricting foreign presence. Menace from other non-banking fiscal services could besides present a menace particularly equity investing, insurance etc. Entrant of a larger participant can do a drastic consequence on the non so strong name in banking or the bank with low income but would non do any important consequence on SBI.

5. Menace from Substitutes: Medium

As you can likely conceive of, there are plentifulness of replacements in the banking industry. Banks offer a suite of services over and above taking sedimentations and imparting money, but whether it is insurance, common financess or fixed income securities, opportunities are there is a non-banking fiscal services company that can offer similar services. On the lending side of the concern, Bankss are seeing competition rise from unconventional companies. But these replacements do non impact SBI due to its immense trade name name and presence in the market.

BCG Analysis of SBI merchandises:

Question Marks:

Security Trading

Merchant Banking

Stars:

Common Fundss

Recognition Card games

Low Market Growth Rate HighDogs:

Life Insurance

Investing Banking

Cash Cattles:

Pension fund Management

Fixed Deposits

Savingss Deposits

Low Market Share High

Competitive Landscape

BANKS ‘ PERFORMANCE IN 2010-11

Bank

Net income per employee ( in Rs hundred thousand )

Net income perA employee ( in Rs hundred thousand )

Tax return on assetsA ( % )

CapitalA adequateness ( % )

Net NPAA ratio ( % )

SBI

704

3.85

0.71

11.98

1.63

PNB

1018

8.35

1.34

12.42

0.85

Bank of Baroda

1333

11

1.33

14.52

0.35

ICICI Bank

735

10

1.35

19.54

1.11

HDFC Bank

653

7.37

1.58

16.22

0.19

Beginning: Reserve Bank of India

Items

2007-08

2008-09

2009-10

2010-11

2011-12

State Bank of India

Business per employee

45.60

55.60

63.60

70.47

79.84

Net income per employee

0.37

0.47

0.45

0.39

0.53

Tax return on Assetss

1.01

1.04

0.88

0.71

0.88

CRAR

13.54 $

14.25

13.39

11.98

13.86

Net NPA ratio

1.78

1.79

1.72

1.63

1.82

Punjab National bank

Business per employee

50.45

65.49

80.80

101.78

113.20

Net income per employee

0.37

0.56

0.73

0.84

0.84

Tax return on Assetss

1.15

1.39

1.44

1.34

1.19

CRAR

13.46

14.03

14.16

12.42

12.63

Net NPA ratio

0.64

0.17

0.53

0.85

1.52

HDFC Bank Ltd.

Business per employee

50.60

44.60

59.00

65.30

65.40

Net income per employee

0.50

0.42

0.60

0.74

0.81

Cost of Funds ( CoF )

5.24

6.92

4.66

4.64

6.06

Tax return on progresss adjusted to CoF

7.38

8.04

6.11

5.91

5.50

Wagess as % to entire disbursals

15.07

15.50

16.68

17.15

14.42

ICICI Bank Ltd

Business per employee

100.80

115.40

76.50

73.50

70.80

Net income per employee

1.00

1.10

0.90

1.00

1.10

Cost of Funds ( CoF )

6.40

5.72

4.18

3.59

4.32

Tax return on progresss adjusted to CoF

4.33

4.33

4.51

4.68

5.10

Wagess as % to entire disbursals

6.57

6.62

8.21

11.95

11.47

Beginning: Run batted in

Stairss taken by SBI and function of OP Bhatt

In July 2006, the Government of India ( GOI ) appointed Bhatt as the SBI Chairman. Traditionally, the authorities appointed the senior-most individual in the bank as its Chairman ; nevertheless, in this instance GOI decided to hold eligibility standards for choice. Bhatt, who was the junior most and youngest campaigner was chosen by authorities among the five shortlisted campaigners.

OP Bhatt had a vision to resuscitate the bank. He stated “ We are a large bank and I want it to be a great bank with betterment in efficiency and quality of service to clients. Over the following twosome of old ages, we want to increase our market portion systematically by around 0.25 % every one-fourth from the current 15 % . ” He made the undermentioned observations:

The bank was losing clients to its rivals chiefly due to deficiency of client satisfaction

Even household members of SBI staff preferable private Bankss

Lack of motive among employees. The employees were executing good at single degree but non at squad degree

Senior direction lost religion in SBI ‘s competitory ability

Lack of engineering to offer better client service as compared with other private Bankss

On 30th June 2006, OP Bhatt made the undermentioned statement after going the SBI president

“ SBI will halt losing market portion and get down deriving it by bettering client service and bettering its engineering. We will besides raise the bank in international rankings. ”

Bhatt believed that he could alter the hereafter of SBI. He knew that SBI has a talented group of employee and if he could link with them as squad member, so they would assist him in the transmutation procedure.

The undermentioned stairss were undertaken by OP Bhatt to transform the bank

Bhatt spend first few months understanding the SBI ‘s place and organizing the transmutation procedure. He talked to assorted experts including advisers, professors, and bank employees to understand the nucleus jobs countries and the likely solutions

Bhatt created four new strategic concern groups headed by Deputy Managing Directors ( DMD ) to capture the rural market and 2nd tier corporate borrowers

He focused on execution of nucleus banking systems across all SBI subdivisions to get the better of the technological barriers

Bhatt realized that for his transformational attempt to win he would necessitate to pass on his vision to the bank ‘s 200,000 employees and alter their mentality

In Sep 2006, OP Bhatt invited the senior direction and their household members to Aamby Valley to explicate his positions and scheme

The Chairman personally wrote missive to the partners of the directors in order to do them experience portion of the SBI group

The meeting resulted in a 14-point transmutation docket for the bank along three wide parameters-business enterprises, enabling enterprises for easing concern and people initiative

“ Normally an organisation focuses merely on concern. However, we focused on enablers such as engineering and procedures every bit good as people who are the nexus between concern and enablers. Without people nil will work and we put them at the Centre. ” – OP Bhatt

The 2nd unit of ammunition of meetings was held with Chief General Managers ( CGM ) and General Managers ( GM ) . At the terminal of the meeting certain dockets were fixed such as – to go the best bank in client service in 2006-2007, the best public sector bank in growing parametric quantities in 2007-2008, the best Indian bank in 2008-2009 and finally the best planetary bank

The GMs and CGMs met all the subdivision directors and explained them about the state of affairs and new vision of the bank. They received positive response from the lower degree directors

The Chairman met all the directors at lower degree in a group of 50 to actuate them to actively take portion in the transmutation procedure

The following measure taken by the Chairman was to win over the trade brotherhoods. He held a meeting with the brotherhood leader to do them understand that unless they work towards the end of the bank, it wo n’t be possible to achieve the desirable consequences

Enabling Enterprises

Bettering the IT substructure of the bank

Redesign of the old procedure and Branch environment – SBI shifted all noncustomer-facing subdivision activities to centralise, back office processing cells so that the subdivisions could concentrate entirely on gross revenues and service. SBI besides redesigned its subdivisions. Glass and fiber modular workstations took the topographic point of high teakwood counters and wire meshed hard currency cabins

Consistent Customer Initiatives – Bhatt ‘s aim was to promote SBI ‘s ranking in client service to the first place. SBI leveraged engineering to better client service

Peoples Enterprises

On 16th July 2007, an internal communicating plan called Parivartan was launched taking at informing the staff about the transmutation attempts, stimulate them to go alteration agents, assist them go more customer-friendly and foster a sense of inclusiveness. A survey done by the Xavier Institute of Management to estimate the impact of Parivartan on client service in the eastern Indian province of Orissa reported that the overall satisfaction degree of SBI clients rose from 46 % to 56 %

Business Enterprises

Attracting the immature clients and supplying better services to win back the Indian in-between category consumer by

Expanding SBI ‘s range in the rural countries by making the Rural Banking and Agricultural Group ( RBAG ) . By 2011, SBI had reached 125,000 small towns and planned to cover 200,000 un-banked small towns by 2012

SBI was acute to widen its presence to international markets and gaining control a greater portion of India linked concern

Consequences

SBI ‘s transmutation attempts yielded rich wagess ; in 2008 it became the most valuable bank in the state in footings of market capitalisation ; by 2010 its ranking as per the Banker magazine moved up to 68 from 107 in 2006 and the State Bank Group ‘s Indian market portion increased to 25 % . The bank besides won legion awards such as the Banker magazine ‘s “ The bank of the twelvemonth, India ” award in 2008 and 2009 and the CNBC Awaaz Consumer awards for “ Most Preferable Bank ” , “ Most Preferred Home Loan Brand ” and “ Most Preferred Credit Card ” trade name in 2010.

Annexures

Table 1: Cardinal Improvement Areas for SBI

Beginning: Mckinsey Proprietary Survey for SBI

Table 2: Consequences of “ Parivartan ” Impact Study on Customer Service

Sep 07

Dec 07

Punctuality

84.06

94.97

Manning of Counters

82.52

94.07

Uninterrupted Counter Service

78.82

88.51

Wearing of ID Cards

31.82

39.18

Dress Code of Employees

94.34

97.79

Handiness of Forms/Brochures

85.36

96.81

Time taken for Servicess

72.47

90.94

Staff Receive Customers Courteously

81.65

96.76

Exchange of Soiled/Mutilated Notes

77.12

84.14

Management of Rush

76.08

90.36

Ambience/Customer Comfortss

62.70

74.40

Time Taken for Disposal of Loan Applications

72.60

89.90

Display of Various Notices

61.11

72.26

Time Taken for Collection/Clearance

59.82

83.75

Ailments

81.05

91.15

Drop Box/Grahak Mitra Service

65.04

72.61

Awareness of Various Merchandises

63.41

87.81

Telephone Mannerss

83.79

96.12

Visibility of Branch Manager

86.75

95.50

Owning up of BPR/CBS

72.25

88.24

A

& gt ; = 85 % of Branches Having Excellent Conformity

A

& gt ; = 70 % and & lt ; 85 % of Branches Having Excellent Conformity

A

& gt ; = 50 % and & lt ; 70 % of Branches Having Excellent Conformity

A

& lt ; 50 % of Branches Having Excellent Conformity

Beginning: Company Documents

Table 3: SBI Financial Highlights ( USD Billion ) from 2005-2010

A

2005

2006

2007

2008

2009

2010

CAGR 2005-2010

Deposits

83.9

85.2

100.2

134.0

146.3

179.1

16.4 %

Progresss

46.3

56.7

77.6

103.9

107.0

140.7

24.9 %

Investings

45.1

36.4

34.3

47.2

54.4

63.7

7.2 %

Entire Assetss

105.1

110.7

130.3

179.8

190.2

234.6

17.4 %

Interest Income

7.4

8.1

9.1

12.2

12.6

15.8

16.4 %

Interest Expenses

4.2

4.6

5.4

8.0

8.5

10.5

20.0 %

Net Interest Income

3.2

3.5

3.7

4.2

4.1

5.3

10.6 %

Non-Interest Income

1.6

1.7

1.3

2.2

2.5

3.3

15.4 %

Entire Operating Income

4.8

5.2

5.0

6.4

6.6

8.6

12.3 %

Staff Expenses

1.6

1.8

1.8

1.9

1.9

2.8

12.4 %

Operating expense Expenses

0.7

0.8

0.9

1.2

1.2

1.7

18.6 %

Entire Operating Expenses

2.3

2.6

2.7

3.1

3.1

4.5

14.5 %

Operating Net income

2.5

2.5

2.3

3.3

3.5

4.1

10.1 %

Net Net income

1.0

1.0

1.0

1.7

1.8

2.0

15.8 %

Beginning: Company Documents

Table 4: Cardinal Financial Ratios ( % ) from 2005-2010

A

2005

2006

2007

2008

2009

2010

RoA

1.0

0.9

0.8

1.0

1.0

0.9

Roe

18.1

15.5

14.2

17.8

15.1

14.8

Dividend Payout Ratio

15.3

16.7

16.2

20.2

20.2

20.8

Cost/Income Ratio

47.8

58.7

54.2

49.0

46.6

52.6

Cost of Deposits

5.1

4.8

4.8

5.6

6.3

5.8

Output on Progresss

7.7

7.8

8.7

9.9

10.2

9.7

Net Interest Margin

3.4

3.4

3.3

3.1

2.9

2.7

Gross NPA Ratio

6.0

3.6

2.9

3.0

2.9

3.1

Net NPA Ratio

2.7

1.9

1.6

1.8

1.8

1.7

Beginning: Company Documents

Beginnings

“ The 5 year that transformed State Bank of India ” , Economic Times, Mar 2011

“ Remaking a government-owned giant ” , Mckinsey Quarterly, April 2009

“ Transforming a State Owned Giant ” , Harvard Business Review, Mar 2011

“ Narrative of how a behemoth changed flight ” , The Hindu, Dec 2010

“ My conflicted bosom ” , The Economist, April 2012

“ RoleA of HRA in ChangeA Management ” , Asiatic Journal of Management Research, 2010

“ How is OP Bhatt maneuvering SBI through troubled times? “ , CNBC-TV18, Aug 2009

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