International Journal of Commerce and Management Studies (IJCAMS)

Peer Reviewed, Indexed Journal, ISSN 2456-3684

Vol.6, No.3, 2021, www.ijcams.com

Financial Performance Analysis of Private Sector Banks in

India: An EAGLE Model Approach
Mr. Jay A. Sathavara #1, Dr. Sejalben R. Christian *2

#1 Research Scholar, Shri D.N. Institute of P. G. Studies in Commerce, Anand-388001, Gujarat

*2 Officiating Principal, Shri D.N. Institute of P. G. Studies in Commerce, Anand-388001, Gujarat.

Abstract banks in US had hurt many economics beyong geographical

Healthy economy is depend upon financial service sector of a borders and forcing many banks in bankruptcy and
nation. Sheduled commercial banks occupy an important place in snatching away the livelihood of millions across the globe
this sector by lending funds and creating saving habits of people. (Jain, Bhimaraya, & K.P., 2019). Private sector banks fall
The aim of this study to evaluate financial performance of selected under sheduled commercial banks and play a very critical
private sector banks of india by using EAGLE model. Private
sector banks such as Axis Bank, HDFC Bank, ICICI Bank,
role for smooth and healthy economy by providing
Indusind Bank and Kotak Mahindra Bank was selected on the resources to individuals, farmers and industrialist. Private
basis of market capitalisation. To achive this objective financial sectors banks is known as their smooth banking services to
data of selected sample was retrived from bank’s annual reports compare with public sector banks. In recent years private
for the period from 2009-10 to 2018-19. Ranking the banks with sector banks of india faces problems in terms of assets
the help of EAGLE model and ANOVA test was used to measure quality, earingng and growth and its arise obstacles for
variance amongs the financial variables of a banks. The finding of profitablity of private sector banks. Its time to evaluate
this study shows that HDFC bank secured first rank in terms of financial performance of private sector banks because of
earning, assets, liquidy and equity parameters where as kotak these major problem. This research paper is analysed
mahindra bank also secured first rank in terms of earning, growth
and equity. Indusind bank also secured first rank in term of growth.
financial performance of selected five private sector banks
ICICI bank earned last rank in terms of earing, assets and growth by EAGLE model. Dr. John Vong is the founder of EAGLE
overall HDFC bank secured first rank followed by Kotak mahindra model and his views, articles and journals about banking
bank, Indusind Bank, Axis bank and ICICI Bank. All the selected profitability has been published and presented in US and
private sector banks has been maintained the capital adequacy Europe. Earning ability, Assets quality, Growth, Liquidity
ratio as per RBI norms. The tabulated values of all the variables and Eaquity are the main parameters of EAGLE model and
are less than significant value 0.05 at 95% confidence level so null every main parameters has sub-parameters.
hypothesis of variables of this study are rejected, that means there
are statistically significant difference in all the selected samples.
2. Literature Review
Keywords: Financial Performance, EAGLE Model, Private
Sector Banks (Baidoo, Amankwah, & Tobazza, 2014) evaluate financial
performance of seven banks of Ghana by the level of capital
adequacy, assets, management, earnings, liquidity and
1. Introduction sensitivity. They found that the level of capital adequacy
Financial Sector play a pivotal role for continuous and assets in most cases influences the level of loans and
development and growth of an economy in which banking advances the bank would give out to its clients and business
sector play a very important role. In recent years indian and a bank with better capital adequacy can afford to invest
banking sector facing some the major problems in terms of in other ventures and meet its client ‘s financial requirement
assets liability, recognisation of NPAs, poor dicision in terms of making loans available to them. They also
making and banking fraud and this major problems is indicated that rate of growth and competition amongs the
slowing down the economy of india. As per the RBI data banks can make banks to increse investment rate to attract
indian banks has 1.8 trillion ruppes of gross NPA and total more public deposits. (Dr.Srinivasan & Saminathan, 2016)
fraud of 71,543 crores in 2018-19 and increasing 74% to judged the financial performance of total twenty five public
comparing with previous year and these major problems sector banks, eighteen private sector banks and eight foreign
slowing down the profitability of indian banks. The sector banks from 2012-2014 with CAMEL model with the
financial crisis of US banks in 2008-09 and failure of large t test, rank test and anova test as a statastical tools and
1
Page
 International Journal of Commerce and Management Studies (IJCAMS)
Peer Reviewed, Indexed Journal, ISSN 2456-3684
Vol.6, No.3, 2021, www.ijcams.com

indicated that banks with low ranking need to improve their twenty seven public sector banks and evaluated on the basis
financial performance to come up in competition with top of financial parameters like bank profitability, productivity,
ranked banks. Their study also suggested that banks with efficiency, bank health and bank credit quality in two
least ranking need to improve their performance to come up phases period from 1995-96 to 2006-07 and 2007-08 to
to the desired standars. (Williams, 2011) determined capital 2016-17. Their study finded that banks profitability fell
adequancy pattern with error correction model and drastically with prominent oscillations over the post
indicated that capital adequacy can be improved if better financial crisis phase and during the post global financial
attention is given to mactro economic factors of a country. crisis phase the steep escalation in the burden of NPAs over
(Ebrahimi, Bahraminasab, & Fard, 2017) estimated stressed the public sector bank group and adversely affected
performance assessment of bank listed on tehran stock its overall performance.
exchange from 2010 to 2015 and indicated that capital and
assets have significant impact on financial performance of 3. Objectives of the Study
banks and liquidity has negetive impact on banks financial
performance. (Ebrahimi, Bahraminasab, & Fard, 2017) The main purpose of this research study is to rank the
also suggested that stock return and Tobin’s Q shoud also private sector banks on the bases of EAGLE model and also
be used for ranking of a banks on the basis of financial analyze, evaluate and compare the financial performance of
performance. (Bokan, Gerali, Gomes, Jacquinot, & Pisani, selected private sector bank with different parameters like
2018) used EAGLE-FLI A macroeconomic model of earning, assets, growth, liquidity and equity.
banking and financial institutions in euro area and
concluded that banking sector can be sorces of business
cycle lopsided and overabundance across countries in a 4. Methodology
monetory union. (Sonaje & Nerlekar, 2017) used CAMEL
model to evaluate financial performance of selected indian This present study has been done on five private sector
banks and conclude that private sector bank have banks namely Axis bank, HDFC bank, ICIC bank, Indusind
outperformed then public sector bank on all the parameters bank and kotak mahindra bank and selected on the basis of
of CAMEL rating model. (Annapurna & Manchala, 2017) market capitalisation. This research period cover total ten
empirically evaluated the performance of top three public years starting from 2009-10 to 2018-19 for selected private
sector banks in india namely state bank of india, bank of sector bank. Secondary data has been used for this research
baroda and punjab national bank using balanced scorecard study and retrived from annual reposts of the banks. Ratio
framework during the period from 2006 to 2015. analysis has been used as accounting tools and one way
Profitability of the samples was measured in terms of return anova test has been used as statistical tool. We tested all
on assets and return on equity. Their study showed there is financial parameters of EAGLE model at 95% confidence
a statistically significant relationship between return on level. These all selected private sector banks were ranked
assets and capital adequacy ratio, net non performing assets on the basis of parametrs and sub parameters of EAGLE
ratio, numbers of ATMs, number of skilled employees. model.
Their study found that the overall performance of the select
public sector banks during the study period was not 5. Hypothesis of the study
remarkable as traditional methods of financial performance
analysis are lopsided and focus on short term earning, the
(H0) There is no significant difference among the
management of public sector banks shoud focus on holistic
performance of Axis bank,HDFC bank,ICICI bank,
performance measure for measuring the overall
Indusind bank and Kotak mahindra bank in terms of
performance. (Jain, Metri, & Rao, 2019) examined the
effect of determinants influencing the performance of 45
[1] Earning ratios - return on assets, interest income to
commercial banks in india post the global financial crisis
for the period from 2010 to 2016. Their study used random total income and interest income to total assets.
effect model on balanced panel data. Their resarch study [2] Asset Quality ratios – gross NPA, net NPA and
conclude that the bank specific explanatory variables like government securities to total investment ratio.
the management efficiency, asset quality, earning quality [3] Growth ratios – growth of deposits and growth of
and liquidity are able to explain significant part of advances.
profitability in indian commercial banks and also banks [4] Liquidity ratios – liquid assets to total assets,
shoud pay attention towards employing funds in more
current assets to total assets and government
profitable instruments while maintaining investments to
total assets. Their result suggested that private sector banks securities to total assets.
performed better than public sector banks. (Budhedeo & [5] Equity ratios – capital adequacy ratio and total
Pandya, 2018) examined financial performance of all advances to total assets.
2
Page
 International Journal of Commerce and Management Studies (IJCAMS)
Peer Reviewed, Indexed Journal, ISSN 2456-3684
Vol.6, No.3, 2021, www.ijcams.com

6. Analysis and Result Table 2: Interst Income to Total Income (II/TI)

6.1 Earning II/TI

Year
Axis HDFC ICICI Indus. Kotak
The earning of banks reflects business of a banks, 2009-10 74.59 79.41 50.59 83.02 45.77
profitability and growth of bank. Table 1 shows that return
on assets of sample over the period from 2009-10 to 2018- 2010-11 76.44 81.38 48.84 83.41 55.68
19. All banks except Indusind Bank earned continuous RoA 2011-12 80.03 82.47 57.00 84.12 65.09
1.14% to 1.90% from 2009-10 to 2014-15 after that ICICI 2012-13 79.92 83.41 60.49 83.67 67.95
bank shows continuous decrease in RoA from 1.10% to
2013-14 79.83 83.68 62.19 81.36 69.41
0.34% in the period from 2015-16 to 2018-19 because of
decrease in net profit of a bank and secured fifth rank in 2014-15 80.17 84.15 60.92 80.13 62.03
terms of RoA. Indusind bank earned maximum RoA 2.37% 2015-16 80.62 84.93 58.48 78.26 72.78
in 2009-10 and also secured first rank in terms of RoA. In
2016-17 78.43 85.05 53.74 77.55 65.69
2017-18 Axis bank earned least RoA 0.06% because of
huge decrease in net profit of a bank. Kotak Mahindra bank 2017-18 79.71 84.16 52.25 78.44 64.75
secured first position in RoA parameter at last ten year 2018-19 79.80 84.73 54.82 79.77 65.11
average (1.93%) followed by HDFC bank (1.63%),
Average 78.96 83.34 55.93 80.97 63.43
Indusind bank (1.55%), Axis bank (1.18%) and ICICI bank
(1.09%). Rank 3 1 5 2 4

Table 1: Return on Assets (RoA)

Table 3: Intrerst Income to Total Assets (II/TA)

RoA
Year II/TA
Axis HDFC ICICI Indus. Kotak Year
Axis HDFC ICICI Indus. Kotak
2009-10 1.37 1.34 0.95 1.14 2.37
2009-10 8.27 8.80 7.60 7.65 11.53
2010-11 1.37 1.43 1.14 1.46 2.12
2010-11 6.24 7.21 5.63 7.87 8.10
2011-12 1.47 1.53 1.26 1.57 1.98
2011-12 7.70 8.26 6.28 9.30 9.17
2012-13 1.53 1.68 1.42 1.63 1.88
2012-13 7.98 8.79 6.65 9.53 9.35
2013-14 1.63 1.73 1.47 1.81 2.01
2013-14 7.95 8.44 6.61 9.48 9.80
2014-15 1.59 1.76 1.48 1.90 2.04
2014-15 7.64 8.34 6.65 8.88 8.96
2015-16 1.56 1.75 1.10 1.63 1.43
2015-16 7.78 8.64 6.45 8.26 8.47
2016-17 0.64 1.70 1.03 1.60 1.78
2016-17 7.38 8.21 6.18 8.06 8.08
2017-18 0.06 1.67 0.68 1.62 1.83
2017-18 6.62 7.73 5.52 7.79 7.44
2018-19 0.61 1.72 0.34 1.18 1.82
2018-19 6.88 8.13 5.81 8.01 7.57
Average 1.18 1.63 1.09 1.55 1.93
Average 7.44 8.26 6.34 8.48 8.85
Rank 4 2 5 3 1
Rank 4 3 5 2 1

Table 2 revels interest income to total income earned by the

The table 3 reveals II/TA ratio of selected private sector
banks from 2008-09 to 2018-19. HDFC bank earned
banks in the period from 2009-10 to 2018-19. There is a
continuous increase in II/TI from 79.41% to 85.05% in the
decrease in percentage of II/TA ratio of Axis bank: 7.98%
period from 2009-10 to 2016-17 and earned first rank in
to 6.62% from 2012-13 to 2017-18, ICICI bank: 6.65% to
terms of II/TI. The maximum percentage of II/TI earned by
5.52% from 2014-15 to 2017-18, Indusind bank: 9.53% to
Axis bank (80.62% in 2015-16), HDFC bank (85.05% in
7.79% from 2012-13 to 2017-18 and Kotak Mahindra bank:
2016-17), ICICI bank (62.19% in 2013-14), Indusind bank
9.80% to 7.44% from 2013-14 to 2017-18. Kotak Mahindra
(84.12% in 2011-12) and Kotak bank (72.78% in 2015-16).
bank secured first position in II/TA parameter.
HDFC bank secured first rank followed by Indusind, Axis,
Kotak and ICICI bank in terms of interest income to total
income ratio of a bank.
3
Page
 International Journal of Commerce and Management Studies (IJCAMS)
Peer Reviewed, Indexed Journal, ISSN 2456-3684
Vol.6, No.3, 2021, www.ijcams.com

Table 6: Gross NPA

Gross NPA
Table 4: Calculation of Group Rank Year
Axis HDFC ICICI Indus. Kotak
Ratio Axis HDFC ICICI Indus. Kotak 2009-10 1.25 1.43 4.50 1.23 2.20
RoA 4 2 5 3 1 2010-11 1.11 1.05 4.06 1.01 1.10
II/TI 3 1 5 2 4 2011-12 1.06 1.00 3.62 0.98 1.10
II/TA 4 3 5 2 1 2012-13 1.20 0.95 3.13 1.03 1.10
Avg 3.67 2.00 5.00 2.33 2.00 2013-14 1.34 0.98 3.03 1.12 1.60
Rank 4 1 5 3 1 2014-15 1.43 0.93 3.78 0.81 1.60
2015-16 1.75 0.94 9.10 0.87 2.10
The table 4 showed rank status of selected banks in sub 2016-17 5.42 1.05 7.80 0.93 2.20
parameters of earning. HDFC bank and Kotak Mahindra
bank secured first position in earning parameter followed 2017-18 6.77 1.30 10.05 1.17 2.00
by Indusind bank, Axis bank and ICICI bank. 2018-19 5.26 1.36 7.47 2.10 1.90
Average 2.66 1.10 5.65 1.13 1.69
Table 5: Result of ANOVA Test
Rank 4 1 5 2 3
P-
Earning SS df MS F
value
The table 6 indicates that ICICI bank reduced gross NPA
(1) RoA
ratio from 10.05% to 7.47% from 2017-18 to 2018-19.
Between
Groups
4.698 4 1.174 10.324 0.000 Highest percentage of gross NPA was registered by Axis
Within Groups 5.119 45 0.114
bank: 6.77% in 2017-18, HDFC bank: 1.43% in 2009-10,
ICICI bank : 10.05% in 2017-18, Indusind bank: 2.10 in
Total 9.817 49 2018-19 and Kotak Mahindra bank: 2.20 in year 2009-10
(2) II/TI and 2016-17.HDFC bank (1.10%) registered first position
Between in terms of Gross NPA ratio followed by Indusind bank
5877.514 4 1469.378 78.827 0.000
Groups (1.13%), Kotak Mahindra bank (1.69%), Axis bank (2.66%)
Within Groups 838.830 45 18.641 and ICICI bank (5.65%).
Total 6716.344 49
Table 7: Net NPA
(3) II/TA
Between Net NPA
Groups 40.077 4 10.019 16.273 0.000 Year
Axis HDFC ICICI Indus. Kotak
Within Groups 27.706 45 0.616
2009-10 0.40 0.31 2.12 0.50 1.10
Total 67.782 49
2010-11 0.29 0.19 1.11 0.28 0.40
The table 5 reveals hypotheses testing result of selected 2011-12 0.28 0.18 0.73 0.27 0.50
private sector banks in RoA, II/TI and II/TA parameters at 2012-13 0.36 0.20 0.77 0.31 0.50
95% confidence level. The calculated value of RoA, II/TI
ratio and II/TA ratio were 0.0000, 0.0000 and 0.0000 2013-14 0.44 0.28 0.97 0.33 0.90
respectively which is less then significant value 0.05 that 2014-15 0.46 0.26 1.61 0.31 0.80
means there is a statistically difference among selected 2015-16 0.73 0.28 2.67 0.36 0.90
private sector banks. The F values of RoA, II/TI ratio and
2016-17 2.26 0.33 4.89 0.39 1.10
II/TA ratio were 10.324, 78.827 and 16.273 respectively.
The current result shows that null hypothesis is rejected. 2017-18 3.40 0.40 5.43 0.51 0.90
2018-19 2.06 0.39 2.29 1.21 0.70
Average 1.07 0.28 2.26 0.45 0.78

6.2 Assets Rank 4 1 5 2 3

4
Page
 International Journal of Commerce and Management Studies (IJCAMS)
Peer Reviewed, Indexed Journal, ISSN 2456-3684
Vol.6, No.3, 2021, www.ijcams.com
Table 8: Govt. Securities to Total Invetments
Table 9 shows that HDFC bank registered first position in
GS/I asset quality parameter of EAGLE model followed by
Year
Axis HDFC ICICI Indus. Kotak Indusind bank, Kotak Mahindra bank, Axis bank and ICICI
bank.
2009-10 61.20 87.25 39.29 81.92 54.38
2010-11 61.51 76.34 34.96 73.96 55.56 Table 10: Result of ANOVA Test
2011-12 62.87 78.74 41.42 81.68 57.14
Assets SS df MS F P-value
2012-13 63.72 76.52 42.93 71.78 57.84
(1) Gross NPA
2013-14 61.10 79.15 42.88 71.33 54.41
Between Groups 144.676 4 36.169 14.566 0.0000
2014-15 60.94 73.29 44.07 72.03 58.86
Within Groups 111.737 45 2.483
2015-16 71.96 81.42 50.23 82.54 67.97
Total 256.413 49
2016-17 70.22 77.06 46.03 85.70 63.02 (2) Net NPA
2017-18 66.23 78.99 48.45 80.61 68.49 Between Groups 24.541 4 6.135 7.394 0.0001
2018-19 67.12 83.53 47.13 82.08 66.89 Within Groups 37.341 45 0.830
Average 64.69 79.23 43.74 78.36 60.46 Total 61.881 49

Rank 3 1 5 2 4 (3) GS/I

Between Groups 8533.833 4 2133.458 93.523 0.0000

Table 7 shows that net performing assets to net advances Within Groups 1026.549 45 22.812
ratio of all the selected private sector banks from the period Total 9560.382 49
2009-10 to 2018-19. HDFC bank also registered lowest
percentage of net NPA 0.39% , followed by Indusind
Table 10 shows hypothesis result of assets quality
bank:0.45%, Kotak Mahindra bank 0.78%, Axis bank:
parameter of EAGLE model at 95% confidence level. There
2.06% and ICICI bank: 2.29% in 2018-19. HDFC bank also
is a statistically difference among Axis bank, HDFC bank,
registered first rank in terms of net NPA ratio. Table 8
ICICI bank, Indusind bank and Kotak Mahindra bank’s
reveals government securities to total investments during
performance in gross npa ratio,net npa ratio GS/I ratio as
the research period. This ratio indicates safe and low risk
the calculated value 0.0000, 0.0010 and 0.0000 are less then
investment of banks over the period. It can be seen from this
0.05.The F values are 14.566, 7.394 and 93.523. From the
research study percentage of GS/I of HDFC bank was
above result null hypothesis of gross npa ratio, net npa ratio
increased from 77.06% to 83.53% during the period from
and GS/I ratio are rejected which means there is a
2016-17 to 2018-19. Highest percentage of GS/I was
significant difference among all selected private sector
registered by Axis bank: 71.96% in 2015-16, HDFC bank:
bank’s pattern.
87.25% in 2009-10, ICICI bank: 50.23% in 2015-16,
Indusind bank: 85.70% in 2016-17 and Kotak Mahindra
bank: 68.49% in 2017-18. It can be seen from table 8 HDFC
bank secured first rank in sub parameter of safety return
6.3 Growth
from investment and low risk exposure in government
The performance of growth of deposits and advances of
securities to total investments over the last ten years
banks shows how the employees of banks are working for
followed by Indusind bank,Axis bank, Kotak Mahindra
better financial performance. Table 11 depicts that ICICI
bank and ICICI bank.
bank registered negative deposit growth -7.50% in 2009-10
Table 9: Calculation of Group Rank
but then showing variation throughout the time period of the
study. Highest percentage of deposit growth registered by
Ratios Axis HDFC ICICI Indus. Kotak Axis bank: 33.93% in 2010-11, HDFC bank: 24% in 2013-
Gross
14, ICICI bank: 16.56% in 2015-16, indusind bank: 36.10%
4 1 5 2 3 in 2016-17 and Kotak Mahindra bank: 86.63% in 2015-16.
NPA
Net
4 1 5 2 3
In growth of deposit parameter Kotak Mahindra bank
NPA secured first position. Table 12 showing advances growth
GS/I 3 1 5 2 4 of selected banks during the period from 2009-10 to 2019-
Avg 3.67 1 5 2 3.33 20. ICICI bank in the initial period of the study showed
negative growth of advances -15.16% in 2009-10 also
Rank 4 1 5 2 3
showed step downfall in percentage of advances growth
19.40% to 6.65% during the period 2010-11 to 2016-17.
5
Page
 International Journal of Commerce and Management Studies (IJCAMS)
Peer Reviewed, Indexed Journal, ISSN 2456-3684
Vol.6, No.3, 2021, www.ijcams.com

Kotak Mahindra bank registered highest percentage of Table 13: Calculation of Group Rank
advances growth 63.36% in 2015-16. Indusind bank
registered first position in advances growth parameter Ratios Axis HDFC ICICI Indus. Kotak
followd by Kotak Mahindra bank, HDFC bank, Axis bank GoD 4 3 5 2 1
and ICICI bank.
GoA 4 3 5 1 2
Table 11: Growth of Deposits Average 4 3 5 2 2

GoD Rank 4 3 5 1 1
Year
Axis HDFC ICICI Indus. Kotak
Table 14 depicts the hypothesis testing of deposit growth
2009-10 20.38 21.00 -7.50 20.80 57.86 and advances growth parameters at 95% confedence level.
2010-11 33.93 16.90 11.70 28.66 25.17 The tabulated value of deposit growth is 0.0015 and
2011-12 16.31 18.30 13.30 23.27 33.49
advances growth is 0.0007 which is less then significant
value 0.05. The F value of deposit growth is 5.213 and
2012-13 14.77 20.10 14.50 27.75 35.45 advances growth is 5.913. The result showed that there is a
2013-14 11.22 24.00 13.43 11.80 15.27 significant difference among Axis bank, HDFC bank, ICICI
2014-15 14.77 22.70 8.93 22.53 27.95 bank, Indusind bank and Kotak Mahindra bank in growth
parameters. So, null hypothesis were rejected in both
2015-16 11.02 17.80 16.56 25.45 86.63
parameters.
2016-17 15.76 17.80 16.28 36.10 14.41
2017-18 9.00 22.50 14.50 19.80 22.94
Table 14: Result of ANOVA Test
2018-19 20.91 17.00 16.40 28.51 17.56
Average 16.81 19.81 11.81 24.47 33.67 Growth SS df MS F P-value

Rank 4 3 5 2 1 (1) GoD

Between
4
Groups 2755.874 688.968 5.213 0.0015
Table 12: Growth of Advances Within Groups 5947.696 45 132.171
Total 8703.570 49
GoA
Year (2) GoA
Axis HDFC ICICI Indus. Kotak Between
4
Groups 1919.409 479.852 5.913 0.0007
2009-10 27.94 27.00 -15.16 30.31 32.12
Within Groups 3651.544 45 81.145
2010-11 36.48 26.80 19.40 27.32 38.74
Total 5570.953 49
2011-12 19.21 22.20 17.30 34.00 28.85
2012-13 16.03 22.70 14.40 26.40 24.67
6.4 Liquidity
2013-14 16.81 26.40 16.69 24.33 8.20
2014-15 22.17 20.60 14.41 24.84 23.62 The liquidity of banks indicates banks ability to pay their
liability when its mature. Liquid assets to total deposits,
2015-16 20.52 19.40 12.32 28.54 63.36
cash to total assets and government securities to total assets
2016-17 10.12 19.40 6.65 27.89 15.42 are sub-parameters of liquidity position of banks. The table
2017-18 18.00 18.70 10.40 28.19 23.25 15 indicates that HDFC bank recorded continuous decrease
in percentage of LA/TD ratio from 10.87% to 7.67% in the
2018-19 12.54 24.50 14.50 28.59 18.18
period from 2013-14 to 2016-17. Kotak Mahindra bank also
Average 19.98 22.77 11.09 28.04 27.64 recorded continuous decrease in percentage of LA/TD ratio
Rank 4 3 5 1 2 from 11.49% to 9.15% during the period 2009-10 to 2012-
13. There is a continuous increase in percentage of LA/TD
ratio of Axis bank from 6.33% to 11.32% in the period from
Table 13 depicts the rank status of selected banks in growth 2011-12 to 2014-15. ICICI bank secured first position with
parameter of EAGLE model and Kotak Mahindra bank average of last ten years LA/TD ratio 14.89% followed by
secured first position. Indusind bank, Kotak Mahindra bank, HDFC bank and Axis
bank.
6
Page
 International Journal of Commerce and Management Studies (IJCAMS)
Peer Reviewed, Indexed Journal, ISSN 2456-3684
Vol.6, No.3, 2021, www.ijcams.com
Table 15: Liquid Assets to Total Deposits
G/TA
LA/TD Year
Year Axis HDFC ICICI Indus. Kotak
Axis HDFC ICICI Indus. Kotak
2009-10 18.94 22.90 14.96 24.09 19.22
2009-10 10.76 17.98 19.52 9.75 11.49
2010-11 18.20 19.30 13.73 21.96 19.64
2010-11 11.32 14.33 15.20 11.71 10.96
2011-12 20.47 22.35 16.04 20.66 19.59
2011-12 6.33 8.59 14.60 13.08 9.81
2012-13 21.22 20.82 16.27 19.25 20.43
2012-13 8.13 9.30 15.68 12.66 9.15
2013-14 17.88 18.79 15.35 17.67 17.27
2013-14 10.19 10.87 13.42 11.19 11.67
2014-15 17.39 19.83 16.15 16.41 18.76
2014-15 11.32 8.11 12.34 14.54 9.48
2015-16 17.31 20.68 15.64 19.67 19.84
2015-16 9.41 7.16 14.42 10.87 8.53
2016-17 14.82 18.20 14.21 17.61 15.62
2016-17 12.28 7.67 15.70 14.72 16.45
2017-18 14.40 17.07 16.04 18.21 18.45
2017-18 9.64 15.61 15.19 8.72 12.76
2018-19 14.35 18.54 15.15 17.51 17.52
2018-19 12.35 8.87 12.83 7.59 13.91
Average 17.50 19.85 15.35 19.30 18.63
Average 10.17 10.85 14.89 11.48 11.42
Rank 4 1 5 2 3
Rank 5 4 1 2 3

The table 17 shows government securities to total assets in

The table 16 shows C/TA ratio over the period from 2009- the period from 2009-10 to 2018-19. Axis bank recorded
10 to 2018-19. Kotak Mahindra bank registered continuous step downfall in percentage of G/TA ratio from 21.22% to
decrease in percentage of C/TA ratio from 3.80% to 1.92% 14.35% in the period from 2012-13 to 2018-19. Indusind
in the period from 2009-10 to 2012-13. Similarly ICICI bank also registered continuous decrease in percentage of
bank also registered continuous decrease in percentage of G/TA ratio from 24.09% to 16.41% in the period from
C/TA ratio from 5.69% to 2.86% in the period from 2009- 2009-10 to 2014-15. ICICI bank recorded lowest
10 to 2012-13. HDFC bank registered highest percentage of percentage of G/TA ratio 13.73% in 2010-11. HDFC bank
C/TA ratio 9.49% in 2017-18. HDFC bank secured first secured first position in G/TA parameters. The table 18
position in C/TA ratio on the basis of last ten years average showed ranking status of banks in sub parameters of
(5.48%). liquidity position of banks. HDFC bank secured first
position in liquidity position parameters followed by
Table 16: Cash with bank to Total Assets
Indusind bank, ICICI bank, Axis bank and Kotak Mahindra
bank.
C/TA
Year
Axis HDFC ICICI Indus. Kotak Table 18: Calculation of Group Rank

2009-10 5.25 6.94 5.69 5.94 3.80

Ratios Axis HDFC ICICI Indus. Kotak
2010-11 5.72 9.03 3.98 5.38 2.87
LA/TD 5 4 1 2 3
2011-12 3.75 4.40 3.35 5.04 2.20
C/TA 2 1 4 3 5
2012-13 4.34 3.59 2.86 4.43 1.92
G/TA 4 1 5 2 3
2013-14 4.41 5.03 2.96 5.07 2.42
Average 3.67 2.00 3.33 2.33 3.67
2014-15 4.24 4.53 3.13 3.70 2.66
Rank 4 1 3 2 4
2015-16 4.09 3.95 2.97 3.16 2.88
2016-17 5.05 4.25 3.23 4.34 2.72 As per table 19 p-value of LA/TD ratio 0.0020, C/TA ratio
2017-18 5.04 9.49 2.96 4.95 2.65 0.0000 and G/TA ratio 0.0000 which is less then the
2018-19 4.31 3.62 3.07 3.59 2.76
significant value 0.05. The F value of LA/TD ratio, C/TA
ratio and C/TA ratio were 5.007, 8.624 and 8.988
Average 4.62 5.48 3.42 4.56 2.69 respectively. The above result shows there is statistically
Rank 2 1 4 3 5 significant difference in the financial performance of Axis
bank, HDFC bank, ICICI bank, Indusind bank and Kotak
Mahindra bank in terms of CA/TD ratio, C/TA ratio and
Table 17: Govt. Securities to Total Assets G/TA ratio. Hence the null hypothesis is rejected.
7
Page
 International Journal of Commerce and Management Studies (IJCAMS)
Peer Reviewed, Indexed Journal, ISSN 2456-3684
Vol.6, No.3, 2021, www.ijcams.com

Mahindra bank: 19.50% in 2010-11. Higher CAR refers

Table 19: Result of ANOVA Test bank was not utilized their funds for lending and also
indicates bank is strong in terms of paying liability when it
Assets SS df MS F P-value matures. The lowest percentage of CAR was registered by
(1) LA/TD Indusind bank 12.09% in 2014-15. Kotak Mahindra bank
secured first position in CAR parameter followed by ICICI
Between Groups 133.431 4 33.358 5.007 0.0020
bank, HDFC bank, Axis bank and Indusind bank. The table
Within Groups 299.825 45 6.663 21 indicates total advances to total assets of equity
Total 433.256 49 parameter for the period of 2009-10 to 2018-19. Highest
percentage of AD/TA ratio was registered by Axis bank:
(2) C/TA
63.93% in 2017-18, HDFC bank: 67.24% in 2018-19, ICICI
Between Groups 48.425 4 12.106 8.624 0.0000 bank: 53.74% in 2015-16, Indusind bank: 67.09% in 2018-
Within Groups 63.169 45 1.404 19 and Kotak Mahindra bank: 61.61% in 2018-19. There is
Total 111.595 49
a continuous increase in percentage of AD/TA ratio by Axis
bank: 57.84% to 63.08% from 2012-13 to 2014-15, HDFC
(3) G/TA bank: 56.59% to 65.61% from 2009-10 to 2016.17, ICICI
Between Groups 126.963 4 31.741 8.988 0.0000 bank 47.17% to 53.74% from 2011-12 to 2015-16,
Within Groups 158.912 45 3.531 Indusind bank: 61.88% to 67.09% from 2015-16 to 2018-
19 and Kotak Mahindra bank: 57.20% to 61.61% from
Total 285.875 49
2012-13 to 2018-19. Indusind bank registered first position
in AD/TA parameter.

6.5 Equity Table 21: Advances to Total Assets

Table 20: Capital Adequacy Ratio AD/TA

Year
Axis HDFC ICICI Indus. Kotak
CAR
Year 2009-10 57.78 56.59 46.14 58.10 53.93
Axis HDFC ICICI Indus. Kotak
2010-11 58.71 57.86 47.96 57.34 55.97
2009-10 15.80 17.44 19.40 15.33 19.30
2011-12 59.48 58.30 47.17 60.88 57.55
2010-11 12.65 16.22 19.50 15.89 19.50
2012-13 57.84 60.64 48.90 60.46 57.20
2011-12 13.66 16.52 18.50 13.85 17.90
2013-14 60.15 62.63 51.80 63.32 58.65
2012-13 17.00 16.80 18.74 15.36 17.00
2014-15 60.88 63.15 53.08 63.04 59.65
2013-14 16.07 16.07 17.70 13.83 18.90
2015-16 63.08 63.93 53.74 61.88 60.13
2014-15 15.09 16.79 17.02 12.09 17.60
2016-17 62.32 65.61 52.26 63.30 60.51
2015-16 15.29 15.53 16.64 15.50 17.00
2017-18 63.93 63.46 50.42 65.40 61.00
2016-17 14.95 14.60 17.39 15.31 17.20
2018-19 62.24 67.24 52.23 67.09 61.61
2017-18 16.57 14.80 16.89 15.03 18.40
Average 60.64 61.94 50.37 62.08 58.62
2018-19 15.84 17.10 18.42 14.16 17.90
Rank 3 2 5 1 4
Average 15.29 16.19 18.02 14.64 18.07
Rank 4 3 2 5 1 The table 22 indicates rank status of all selected banks in
equity parameter of EAGLE model. HDFC bank and Kotak
The table 20 reveals that Axis bank, HDFC bank, ICICI Mahindra bank secured first position in equity parameter
bank, Indusind bank and Kotak Mahindra bank maintain followed by Indusind bank, Axis bank and ICICI bank.
CAR ratio as per Basel accord II and RBI norms. There is a
continuous decrease in CAR of Indusind bank from 15.50%
to 14.16% in the period from 2015-16 to 2018-19 and
secured last position in CAR parameter. Highest percentage
of CAR was registered by Axis bank: 17% in 2012-13,
HDFC bank: 17.44% in 2009-10, ICICI bank: 19.50% in
2010-11, Indusind bank: 15.89% in 2010-11 and Kotak
8
Page
 International Journal of Commerce and Management Studies (IJCAMS)
Peer Reviewed, Indexed Journal, ISSN 2456-3684
Vol.6, No.3, 2021, www.ijcams.com
The table 24 reveals overall rank status of selected private
sector banks on the basis of EAGLE parameters. In this
research study HDFC bank secured first position with
outstanding performance followed by Kotak Mahindra bank
at second position with superior performance. Indusind
Table 22: Calculation of Group Rank bank secured the third position with average performance
which means that it is a good bank followed by Axis bank
Ratios Axis HDFC ICICI Indus. Kotak at fourth position and ICICI bank at fifth position. This
CAR 4 3 2 5 1 study clearly reveals that the performance of HDFC bank,
Kotak Mahindra bank and Indusind bank were outstanding,
AD/TA 3 2 5 1 4
superior and average in all parameters like earning, assets,
Average 4 3 4 3 3 growth, liquidity and equity.
Rank 4 1 4 3 1
7. Limitations of the study and Scope
Table 23: Result of ANOVA Test
This study done with only selected five private sector banks
Assets SS df MS F P-value
from Indian banking sector and limited to ten years only
from 2009-10 to 2018-19. This research study was based on
(1) CAR secondary data of selected private sector banks so no
Between Groups 97.932 4 24.483 20.814 0.0000
primary and economic (macro) data were considered for
Within Groups 45
this research study. This current research include only
52.934 1.176 earning, assets, growth, liquidity and equity parameters no
Total 150.866 49 any strategy, management and sensitivity to market risk
(2) AD/TA parameters were considered. Only private sector bank has
Between Groups 4 been selected for this research study so any generalization
950.899 237.725 30.259 0.0000
of result cannot be applied to all the banks. It is positively
Within Groups 45
353.529 7.856 expected that this research study will be used to individuals,
Total 1304.429 49 customers of the banks, investors, bankers, policy makers,
regulators and future researchers. Further research can be
The table 23 describes the result of CAR and AD/TA ratio done with all private sector banks and all public sector
at 95% confedence level. P value of CAR and AD/TA ratio banks of India with internal and external factors like GDP,
were 0.0000 and 0.0000 which is less then significant value foreign exchange rate and change in interest rates etc.
0.05. F value of CAR and AD/TA ratio was 20.814 and
30.259. P tabulated value of both sub parameters is less then 8. Conclusion
significant value so null hypothesis is rejected. Above result
showed that there is a significant difference in terms of
Based on findings, we conclude that the financial variable
CAR and AD/TA ratio among Axis bank, HDFC bank.
of banks like earning, assets, growth, liquidity and equity
ICICI bank, Indusind bank and Kotak Mahindra bank.
are able to describe the important part of profitability of
private sector banks. From the above result HDFC bank
Table 24: Overall Rank Status secured first rank in earning, assets, liquidity and equity
parameters with outstanding performance and secured third
EAGLE Axis HDFC ICICI Indus. Kotak rank in growth parameter because of low growth rate of
deposits and advances. Kotak Mahindra bank also secured
E 4 1 5 3 1
first rank in earning, growth and equity parameters with
A 4 1 5 2 3 superior performance and secured third and fourth rank in
G 4 3 5 1 1 assets and liquidity parameters respectively. ICICI bank
L 4 1 3 2 4
secured last position in earning, assets and growth
parameters with below average performance. ICICI bank
E 4 1 4 3 1 should pay attention on this parameters to improve their
Avg 4.00 1.40 4.40 2.20 2.00 profitability. There is a strong competition in liquidity and
Rank 4 1 5 3 2
earning parameters among all selected private sector banks.
All the selected private sector banks has been maintained
the capital adequacy ratio as per RBI norms. The tabulated
values of all the variables are less than significant value
9
Page
 International Journal of Commerce and Management Studies (IJCAMS)
Peer Reviewed, Indexed Journal, ISSN 2456-3684
Vol.6, No.3, 2021, www.ijcams.com

0.05. So null hypothesis of variables of this study are Sector Banks In India. The Thesis submitted to Jiwaji
rejected, that means there are statistically significant University.
difference in all the selected samples. Finally this research [13] Bokan, N., Gerali, A., Gomes, S., Jacquinot, P., & Pisani, M.
study conclude that the large private sector bank selected on (2018). EAGLE-FLI: A macroeconomic model of banking
the bases of market capitalization of India that are Axis and financial interdependence in the euro area. Economic
bank, HDFC bank, ICICI bank, Indusind bank and Kotak Modelling 69 , 249-280.
Mahindra bank had a acceptable performance according to [14] Budhedeo, S., & Pandya, N. (2018). Financial Performance
EAGLE parameters. of Public Sector Banks in India: A Post Reform Analysis.
Indian Journal of Finance , 7-20.
9. References [15] Cole, R. A., & White, L. J. (2012). Déjà Vu All Over Again:
The Causes of U.S. Commercial Bank Failures This Time
[1] Abdulsalam Abubakar, I. M. (2013). Impact of Banking Sector Around. Journal of Financial Services Research , 5-29.
Development on Economic Growth: Another Look at the [16] De-Gregorio. (1996). Borrowing constraints, human capital
Evidence from Nigeria. Journal of Business Management & accumulation, and growth. Journal of Monetory Economics
Social Sciences Research , 47-57. , 1 (37), 49-71.
[2] Abida, Z., Sghaier, I. M., & Zghidi, N. (2015). Financial [17] Dixit, A. (2005). Impact banking finiancial sector reforms
Development and Economic Growth: Evidence from North indian economy 1991 Social Sciences,Economics and
African Countries. Economic Alternatives , 17-33. Business,Business Finance. A thesis submitted to
[3] Abusharbeh, M. T. (2017). The Impact of Banking Sector Chhatrapati Sahuji Maharaj University.
Development on Economic Growth: Empirical Analysis from [18] Dr.Srinivasan, & Saminathan, Y. P. (2016). A Camel Model
Palestinian Economy. Journal of Emerging Issues in Analysis of Public, Private and Foreign Sector Banks in
Economics, Finance and Banking , 2306-2316. India. Pacific Business Review International , 8 (9), 45-57.
[4] Ajibike, O. (2016). The Effect of Banks Profitability on [19] Ebrahimi, S. K., Bahraminasab, A., & Fard, M. Y. (2017).
Economic Growth in Nigeria. IOSR Journal of Business and Performance Assessment of Banks listed on Tehran Stock
Management , 01-09. Exchange based on CAMEL Indicators. International
[5] Ally, Z. (2014). Determinants of Banks’ Profitability in a Journal of Economics and Financial Issues , 7 (5), 128-136.
Developing Economy : Empirical Evidence from Tanzania. [20] Gadhiya, N. M. (2015). The Study of Financial Performance
European Journal of Business and Management , 363-375. of selected Public and Private sector banks in India with
[6] Alrgaibat, G. A. (2015). Impact of Economic Variables on the reference to CAMEL model. The thesis submitted to
Performance of the Jordanian Banking Sector. Journal of Saurastra University.
Poverty, Investment and Development , 107-114. [21] Gariwala, B. J. (1987). Impact Of Regional Rural Banks On
[7] Alshubiri, F. N. (2017). Evaluating the impact of Financial Rural Economy With Special Reference To Gujarat. A
Banking Development on Economic Growth: An Empirical Thesis submitted to Maharaja Krishnakumarsinhji
Investigation in Sultanate of Oman. Indian Journal of Finance Bhavnagar University.
, 50-61. [22] Gondesi, S. K. (2016). Evaluating financial performance of
[8] Annapurna, V., & Manchala, G. (2017). Balanced Scorecard select public and private sector banks using camels and
Evaluation of the Performance of Indian Public Sector Banks. eagles models. The Thesis submitted to GITAM University.
Indian Journal of Finance , 7-21. [23] http://www.economicsdiscussion.net/banks/nationalized-
[9] Ansari, M. S. (2008). Performance evaluation of nationalised banks/9-major-problems-faced-by-indias-nationalized-
commercial banks in India through camels model in the post banks/12927. (n.d.).
liberalisation era. The Thesis submitted to Bundelkhand [24] http://www.yourarticlelibrary.com/essay/role-of-banks-in-
University. the-development-of-indian-economy/42577. (n.d.).
[10] Baidoo, W. T., Amankwah, S., & Tobazza, S. (2014). The [25] https://economictimes.indiatimes.com/industry/banking/fin
Use of CAMELS Model to Evaluate Banks, a Case Study of ance/banking/total-frauds-at-banks-rise-74-per-cent-to-rs-
Seven Banks in Ghana. International Coference on Applied 71543-crore-in-2018-19-rbi/articleshow/72957892.cms.
Sciences and Technology International Coference on (n.d.). Retrieved from economic times.
Applied Sciences and Technology , 1-13. [26] https://qz.com/india/1020168/the-rbi-is-worried-about-
[11] Bandlamudi Kalpana, T. V. (2017). Role of Commercial three-big-problems-in-indiasbanking-. (n.d.).
Banks in the Economic Development of India. International [27] https://www.quora.com/What-is-the-importance-of-
Journal of Management and Applied Science , 1-4. banking-in-India. (n.d.).
[12] Bhiryani, H. (2017). Performance analysis through camel [28] https://www.statista.com/statistics/1063340/india-gross-
rating A Comparative Study of Selected Public and Private npa-value-private-banks/. (n.d.). Retrieved from Statista.
10
Page
 International Journal of Commerce and Management Studies (IJCAMS)
Peer Reviewed, Indexed Journal, ISSN 2456-3684
Vol.6, No.3, 2021, www.ijcams.com
[29] https://www.worldwidejournals.com/paripex/recent_issues [44] Shun-Jen Hsueh, C.-H. T. (2013). Economic growth and
_pdf/2016/April/. (n.d.). financial development in Asian countries: A bootstrap panel
[30] Jain, R. K., Bhimaraya, M., & K.P., V. r. (2019). Granger causality analysis. Economic Modeling , 294-301.
Determinants of Profitability of Indian Commercial Banks. [45] Sonaje, V. H., & Nerlekar, S. (2017). Financial Performance
Indian Journal of Finance , 13 (1), 8-19. Analysis of Selected Banks using CAMEL Approach. IMR
[31] Jain, R., Metri, B., & Rao, K. V. (2019). Determinants of (Indira Management Review) , 11 (2), 17-24.
Profitability of Indian Commercial Banks. Indian Journal of [46] Suba, N. R. (2016). Financial performance analysis of
Finance , 8-19. selected public and private sector banks a study through
[32] Korkmaz, S. (2015). Impact of Bank Credits on Economic camel model. The Thesis submitted to Saurashtra
Growth and Inflation. Journal of Applied Finance & University.
Banking , 57-69. [47] V. Annapurna, G. M. (2017). Balanced Scorecard
[33] Kumar, A. P. (2013). A Comparative Performance Analysis Evaluation of the Performance of Indian Public Sector
of Banking Sector with Special Reference to Camel Model. Banks. Indian Journal of Finance , 7-21.
The Thesis submitted to Dr. Rammanohar Lohia Avadh [48] Viswanathan, P., & Muthuraj, M. (2019). Factors Leading
University, Faizabad. to Non Performing Assets (NPAs): An Empirical Study.
[34] Kumar, H. (2013). Impact of deposit mobilization and credit Indian Journal of Finance , 55-64.
creation by scheduled commercial banks in Indian economy [49] Williams, H. T. (2011). Determinants of capital adequacy in
since 1991 with reference to state bank of India in an input the Banking Sub-Sector of the Nigeria Economy: Efficacy
output framework. A Thesis submitted to University of of Camels.(A Model Specification with Co-Integration
Mysore. Analysis). International Journal of Academic Research in
[35] Paun, C. V., Musetescu, R. C., Topan, V. M., & Danuletiu, Business and Social Sciences , 1 (3), 233-248.
D. C. (2019). The Impact of Financial Sector Development
and Sophistication on Sustainable Economic Growth.
Sustainability , 1-21.
[36] Pierre Monnin, T. J. (2010). The Impact of Banking Sector
Stability on the Real Economy. Swiss National Bank
Working Papers , 1-31.
[37] Ragonmal, L. (2015). Impact of commercial banking sector
development on economic growth in small Pacific countries:
A case study of the Vanuatu Economy. A Thesis submitted
to Lincoln University Degital Thesis.
[38] Raju Ahmed, M. Y. (2019). Banking Sector Development
and Economic growth in Bangladesh: An Empirical
Analysis. Canadian Journal of researcher's Society .
[39] Ravi, A. (2007). Performance appraisal of amalgamated
and stand alone regional rural banks a comparative study
through camels model approach. The Thesis submitted to
University of Lucknow.
[40] Roger Antoun, A. C. (2018). Determinants of financial
performance of banks in Central and Eastern Europe.
Business and Economic Horizons , 513-529.
[41] S. Santoshkumar, B. C. (2018). Determinant of Capital
Structure: An Exclusive Study of Passenger Car Companies
in India. Indian Journal of Finance , 43-53.
[42] Sahota, S., & Babli, D. (2017). Relative performance
Analysis of Scheduled Commercial Banks in India: A
CAMEl Model Approach. Indian Journal of Finance , 40-
57.
[43] Sahota, S., & Dhiman, B. (2017). Relative Performance
Analysis of scheduled Commercial banks in India: A
CAMEL Model Approach. Indian Journal of Finance , 40-
57.
11
Page