Eai 16-12-2022 2326178

Comparative Performance Analysis of Selected
Commercial Banks in India: Camel Model

Suman1 and Swati2
{sumanmann1115@gmail.com1, swatimann@gmail.com2}
Department of Management Studies, Deenbandhu Chhotu Ram University of Science & Technology,
Murthal, Haryana, India1, Department of Management, School of Management & Business Studies,
Jamia Hamdard (Deemed to be University), New Delhi, India2
Abstract. One of the key instruments suggested to assess the performance and financial
stability of banks is CAMEL, which has five parameters: capital sufficiency, asset
quality, management quality, earning quality, and liquidity. As banks are crucial to a
nation's economic development and prosperity, it is crucial to evaluate their performance.
As a result, the current study's goal is to use the CAMEL model to examine the
performance of a few chosen commercial banks that operate in India from 2013–2014 to
2017–2018. This study uses a sample of 12 commercial banks, of which 7 were from the
public sector and 5 from the private sector. According to analysis results, HDFC Bank is
in first place, followed by Axis Bank and Kotak Bank, in that order. Among all the
chosen banks, Bank of India holds the final spot. A statistically significant difference
between the CAMEL ratios of the chosen public and private sector banks in India can
also be inferred.
Keywords: CAMEL analysis, financial performance, Commercial Banks.
1 Introduction
Banks are among the financial institutions that are crucial to the expansion and improvement
of an entire nation's economy. Since 1991, the banking industry has been experiencing an
extensive and complex phase of reorganisation to improve its soundness and operational
efficiency. At the same time, it is solidifying its ties with the real sector in order to encourage
savings, investment, and economic growth.
A poor banking sector not only jeopardises an economy's long-term viability, but it can also
serve as a catalyst for a financial crisis that can result in an economic crisis [22]. Therefore, it
is crucial for any economy to periodically be aware of the financial results of the banking
sector. There are many models for analysing the financial performance of banks, and one of
them is the CAMEL model, which has five parameters: enough capital, high-quality assets,
effective management, profitable earnings, and liquidity.
The remaining portions of our essay are as follows: Review of the literature takes up section
two. The study's research aims are described in section three. The research technique is
ICASDMBW 2022, December 16-17, Delhi, India

Copyright © 2023 EAI
DOI 10.4108/eai.16-12-2022.2326178
explained in section four. The analysis and interpretation of the results are shown in section
five. The study is concluded in the last portion.
2 Literature review
Dash and Das (2009) Employing the CAMELS framework, researchers looked at the
performance of both public and private/foreign banks in India. Information is drawn from the
Capitaline database for the years 2003–2004 through 2007–2008. They looked at data from
fifty-eight banks, of which twenty-nine were in the public sector and twenty-nine were in the
private or foreign sector. Overall findings indicate that private and foreign banks outperformed
public sector banks. Management soundness and earnings and profitability were the two
CAMELS characteristics that had the greatest impact on the performance of private/foreign
banks.[12]
Kaur (2010) have employed a CAMEL technique to examine the performance of Indian
commercial banks. For the analysis, two ratios for each CAMEL parameter were employed.
28 banks from the public, private, and international sectors make up the sample. The results
demonstrate that State Bank of Patiala and Andhra Bank are the finest public sector banks,
whereas Jammu and Kashmir has been ranked first among private sector banks, followed by
HDFC Bank. The top-ranked foreign sector bank is Antwerp Bank, followed by JP Morgan
Chase Bank.[14]
Sangmi and Nazir (2010) undertook a study to assess the financial performance of the two
biggest commercial banks operating in northern India between 2001 and 2005, namely Punjab
National Bank and Jammu and Kashmir Bank, using CAMEL characteristics. They conducted
the analysis using mean and standard deviation as statistical tools. Data is gathered from the
corresponding banks' annual reports. According to the findings, both banks are financially
sustainable and sufficient in terms of their capital sufficiency, asset quality, managerial
capacity, and liquidity.[21]
Misra and Aspal (2013) Utilizing the CAMEL approach, try to look into the efficiency and
stability of the state bank group's finances. Data for the analysis is gathered from the banks'
publicly available annual reports for the years 2009 through 2011. For testing hypotheses and
determining if a distribution is normal, they have utilised one-way ANOVA, K-S, and
Shapiro-Wilk tests, respectively. The main output reveals that the various banks have achieved
varied ranks with respect to CAMEL characteristics, however empirical data demonstrate that
there is no statistically significant difference between the CAMEL ratios.[15]
Sayed and Sayed (2013) did the study to compare and contrast four Indian private sector
banks. They employed CAMEL rating for the analysis, which covered the three-year period
from 2008-09 to 2010-11, and data was gathered from the annual reports of the chosen
institutions. Based on the findings, it is clear that Kotak Mahindra Bank is in the lead among
other private sector banks.[22]
Gautam et al. (2014) Try to assess the six Indian banks' performance from 1996 to 2009 using
the CAMEL methodology. As a statistical approach for the investigation, they employed
discriminate analysis (MDA). The study's conclusions show that bank ratings overall provide a
clear representation of bank performance because HDFC is rated first, followed by SBI, PNB,
BOB, and ICICI. In third place is BOI. Overall findings indicate that the MDA model may
accurately predict bank failure one year before a merger.[13]
Trivedi et al.(2015) Utilizing the CAMEL rating methodology, analyse the performance of
Indian public and private sector banks. The study's data comes from bank annual reports from
2009 to 2019. Four banks have been chosen for the investigation. Results indicate that various
banks achieve varying rankings according to CAMEL ratios.[28]
Srinivasan and Saminathan (2016) conducted CAMEL model analyses on Indian banks
operating in the public, private, and foreign sectors. The weighted average approach is utilised
to rank these banks based on financial data from the years 2012 to 2014, and one-way
ANOVA was also employed to test the hypothesis. 51 commercial banks have been selected
for research. Their empirical findings demonstrate a statistically significant difference between
the CAMEL ratios of the chosen commercial banks in India, which rated banks based on their
performance.[23]
Pekkaya and Demir (2018) contend that banking is the fundamental source of financial
strength in any country. Nearly all industries are impacted by banks, both directly and
indirectly. It has a significant impact on how economic resources are allocated and how stable
a nation's finances are. The impact and importance of banks operating in the modern economy
cannot be overstated, and the variety of goods and services they offer to the public is
expanding.
The CAMELS technique was approved by Georgios and Elvis as a system for evaluating the
eight main Balkan banks (Georgios & Elvis, 2019). Their research supports the notion that the
CAMELS rating model is crucial to the supervision of banks. The CAMEL technique was
utilised by (Das & Nayak, 2020) to assess the financial performance of both public and
commercial banks in Odisha, India. The CAMELS model was used as a framework for
identifying and measuring the important performance characteristics for the Vietnamese
commercial banks from 2009 to 2020 (Nguyen, 2021). The author further examines ten
statistically significant factors, including all of the CAMELS approach's components, using
the quantitative regression technique System Generalized Method of Moments (SGMM) on
the findings from earlier study.
The results show a connection between bank performance and ownership type, and they
recommend strengthening the stability of state-owned banks. (AL-Najjar, D.; Assous, H.F.,
2021) investigated the most widely used and reliable bank rating method, the CAMEL
evaluation approach [2]. In order to analyse the impact on the deposit accounts held with those
banks between 2014 and 2018, the authors evaluated the performance of the eleven Saudi
banks listed in the Saudi Stock Exchange All-Share Index (TASI) and graded them based on
their CAMEL composite and CAMEL overall ratings. The findings demonstrate that their
equity, as assessed by the CAR, management's effectiveness, return on equity, and liquidity, as
measured by the loans-to-deposits ratio, all have a favourable impact on the volume of
deposits held with those banks.
3 Objectives of Study
To analyze the performance of commercial banks operating in India using the CAMEL Model
i.e., Capital Adequacy, Assets Quality, Management Quality, Earning & Liquidity.
4 Research Methodology
CAMEL is a ratio-based model used to evaluate the financial performance of banks. The
present study used fifteen financial ratios for the analysis. Six-year average has been
calculated with the help of arithmetic mean then each bank is ranked based on its performance.
Type of Research Design – Descriptive.
Sample Selection- The sample consists of 12 commercial banks of which, seven (State Bank
of India, Bank Of Baroda, Bank Of India, Canara Bank, Punjab National Bank, Oriental Bank
Of Commerce, Union Bank Of India) from the public sector and five (ICICI Bank Ltd, HDFC
Bank Ltd, Axis Bank Ltd, Kotak Mahindra Bank Ltd. and South Indian Bank) from the private
sector banks in India. Most of these banks are traded in National stock exchange.
Period of Study- The data collected for comparing the banks performances pertains for the
period of six years i.e., 2014-2019.
Sources of data – The study is purely based on secondary data. This have been collected from
the Statistical Tables related to banks in India available on the official website of RBI and
Money Control.Com, and annual reports of the respective banks for various years have also
been used.
Statistical Tools- (i) Arithmetic mean for calculating values for the purpose of performance
evaluation. (ii) One-way ANOVA has been used to determine the whether there is any
significant difference between the means of CAMEL ratios of public and private sector banks.
Table 1: Description of Calculated Financial Ratios Under CAMEL Model

Capital Assets Management Earning Liquidity
Adequacy Quality Quality Quality
Capital Net NPA to Net Return on Operating Profits Cash-Deposit
Adequacy Ratio Advances Advances to Total Assets Ratio
Capital Secured Business Per Return on Assets Credit-Deposit

Adequacy ratio - Advances to Employee Ratio
Tier I Total Advances
Profit Per Net Interest Investment-
Capital Interest Income to Employee Income to Total Deposit Ratio
Adequacy ratio - Total Assets Assets
Tier II
5 Data Analysis and Interpretation
5.1. Capital Adequacy: -

Table 1.1: Capital Adequacy Ratio (%)
Source: Statistical Tables relating to Banks in India
Banks Capital Adequacy Ratio (%)
2014 2015 2016 2017 2018 2019 Avg Rank
State Bank of India 11.98 13.86 12.92 12.44 12.00 13.12 12.72 7
Bank of Baroda 14.52 14.67 13.30 12.28 12.61 13.18 13.43 5
Bank of India 12.17 11.95 11.02 9.97 10.73 12.01 11.31 11
Canara Bank 15.38 13.76 12.40 10.63 10.56 11.08 12.30 8
Punjab National 12.42 12.63 12.72 11.52 12.21 11.28 12.13 10
Bank
Oriental Bank of 14.23 12.69 12.04 11.01 11.41 11.76 12.19 9
Commerce
Union Bank of 12.95 11.85 11.45 10.80 10.22 10.56 11.31 12
India
ICICI Bank 19.54 18.52 18.74 17.70 17.02 16.64 18.03 1
HDFC Bank 16.22 16.52 16.80 16.07 16.79 15.53 16.32 3
Axis Bank 12.65 13.66 17.00 16.07 15.09 15.29 14.96 4
Kotak Mahindra 19.92 17.52 16.05 18.83 17.17 16.34 17.64 2
Bank
South Indian Bank 14.01 14.00 13.91 12.42 12.01 11.82 13.03 6
Interpretation- In contrast to the 8% recommended in Basel protocols, the RBI requires

banks to maintain a minimum Capital to Risk-weighted Assets Ratio (CRAR) of 9% with
regard to credit risk, market risk, and operational risk on a continuing basis. According to
table 1.1, ICICI Bank held the top spot with the highest CAR average (18.03), followed by
Kotak Bank (17.64) and HDFC Banks (16.32) in second and third place, respectively. Union
Bank and Bank of India both had the lowest CAR ratings (11.31) (11.31). The greater the
CAR Ratio number, the healthier the bank's finances will be.
Table 1.2: Capital Adequacy Ratio - Tier I

Banks Capital Adequacy Ratio - Tier I
2014 2015 2016 2017 2018 2019 Avg Rank

Bank of Baroda 9.99 10.83 10.13 9.28 9.87 10.79 10.15 6
Bank of India 8.33 8.59 8.20 7.24 8.17 9.03 8.26 11
Canara Bank 10.87 10.35 9.77 7.68 8.02 8.80 9.25 9
Punjab National 8.44 9.28 9.76 8.87 9.30 8.41 9.01 10
Bank
Oriental Bank of 11.21 10.12 9.18 8.86 8.73 9.10 9.53 7
Commerce
Union Bank of India 8.69 8.37 8.23 7.54 7.50 8.14 8.08 12
ICICI Bank 13.17 12.68 12.80 12.78 12.78 13.09 12.88 2
HDFC Bank 12.23 11.60 11.08 11.77 13.66 13.22 12.26 3
Axis Bank 9.41 9.45 12.23 12.62 12.07 12.51 11.38 4
Kotak Mahindra 17.99 15.74 14.71 17.77 16.18 15.28 16.28 1
Bank
Interpretation- According to table 1.2, Kotak Bank held the top spot with a CAR- Tier-I
average of 16.28, followed by ICICI Bank (12.88) and HDFC Banks (12.26) in second and
third place, respectively. Union Bank and Bank of India both received the lowest CAR Tier-I
scores (8.08). (8.26). The better for the bank's financial stability the CAR Tier-I Ratio score.
Table 1.3: Capital Adequacy Ratio - Tier II
Banks Capital Adequacy Ratio - Tier II
2014 2015 2016 2017 2018 2019 Avg Rank
Bank of Baroda 4.53 3.84 3.17 3.00 2.74 2.39 3.28 5
Bank of India 3.84 3.36 2.82 2.73 2.56 2.98 3.05 9
Canara Bank 4.51 3.41 2.63 2.95 2.54 2.28 3.05 8
Punjab National 3.98 3.35 2.96 2.65 2.91 2.87 3.12 7
Bank
Oriental Bank of 3.02 2.57 2.86 2.15 2.68 2.66 2.66 10
Commerce
ICICI Bank 6.37 5.84 5.94 4.92 4.24 3.65 5.16 1
HDFC Bank 3.99 4.92 5.72 4.30 3.13 2.31 4.06 2
Axis Bank 3.24 4.21 4.77 3.45 3.02 2.78 3.58 3
Kotak Mahindra 1.93 1.78 1.34 1.06 0.99 1.06 1.36 12
Bank
Interpretation- According to table 1.3, ICICI Bank held the top spot with the highest average
of CAR-Tier-II scores (5.16), followed by HDFC Bank (4.06) and Axis Banks (3.58) in that
order. Kotak Bank received the lowest CAR Tier-II score (1.36). The greater the CAR Tier-II
Ratio rating, the healthier the bank's finances will be.
Table 1.4: Composite Capital Adequacy
Source: Authors calculation
Banks CAR Capital Capital Group Rank
adequacy adequacy
ratio - Tier I ratio - Tier II
% Rank % Rank % Rank Avg Rank
State Bank of India 12.72 7 9.38 8 3.34 4 6.33 6
Bank of Baroda 13.43 5 10.15 6 3.28 5 5.33 5
Bank of India 11.31 11 8.26 11 3.05 9 10.33 12
Canara Bank 12.30 8 9.25 9 3.05 8 8.33 8
Punjab National Bank 12.13 10 9.01 10 3.12 7 9.00 10
Oriental Bank of 12.19 9 9.53 7 2.66 10 8.67 9
Commerce
Union Bank of India 11.31 12 8.08 12 3.23 6 10.00 11
ICICI Bank 18.03 1 12.88 2 5.16 1 1.33 1
HDFC Bank 16.32 3 12.26 3 4.06 2 2.67 2
Axis Bank 14.96 4 11.38 4 3.58 3 3.67 3
Kotak Mahindra Bank 17.64 2 16.28 1 1.36 12 5.00 4
South Indian Bank 13.03 6 10.99 5 2.04 11 7.33 7
Interpretation- Based on a review of the group averages for the three capital adequacy ratios
shown in Table 1.4. The results show that ICICI Bank took the top spot with a group average
rank of 1.33, followed by HDFC Bank (2.67) and Axis Banks (3.67) in that order. Due to its
poor performance in all three measures, Bank of India received the lowest ranking, with a
group average rating of 10.33.
5.2. Asset Quality: -
Table 2.1: Ratio of Net NPA to Net Advances
Banks Net NPA To Net Advances
2014 2015 2016 2017 2018 2019 Avg Rank
Bank of Baroda 0.35 0.54 1.28 1.52 1.89 5.06 1.77 6
Bank of India 0.91 1.47 2.06 2.00 3.36 7.79 2.93 10
Canara Bank 1.10 1.46 2.18 1.98 2.65 6.42 2.63 9
Punjab National Bank 0.85 1.52 2.35 2.85 4.06 8.61 3.37 12
Oriental Bank of 0.98 2.21 2.27 2.82 3.34 6.70 3.05 11
Commerce
ICICI Bank 1.11 0.73 0.77 0.97 1.61 2.98 1.36 5
HDFC Bank 0.19 0.18 0.20 0.27 0.25 0.28 0.23 1
Axis Bank 0.29 0.27 0.36 0.44 0.46 0.74 0.43 2
Kotak Mahindra Bank 0.72 0.61 0.64 1.08 0.92 1.06 0.84 3
Interpretation- According to the study in table 2.1, HDFC Bank came in first with the lowest
average score of 0.23, followed by Axis Bank (0.43) and Kotak Bank (.84) on the second and
third spots, respectively. The lowest ranking Punjab National Bank has a best average of 3.37.
The bank's financial situation is improved by a decreased Net NPA to Net Advances ratio.
Table 2.2: Ratio of secured advances to total advances
Banks Secured Advances to Total Advances
2014 2015 2016 2017 2018 2019 Avg Rank
Bank of Baroda 78.53 83.67 87.28 86.29 87.47 88.22 85.24 4
Bank of India 76.37 78.94 85.92 82.11 85.01 84.09 82.07 7
Canara Bank 69.53 75.47 82.59 83.72 82.81 86.05 80.03 11
Oriental Bank of 87.82 92.68 93.58 93.65 93.78 91.33 92.14 2
Commerce
ICICI Bank 78.88 84.82 85.91 85.62 86.26 82.71 84.03 6
HDFC Bank 75.51 75.54 76.24 77.55 76.58 76.90 76.39 12
Axis Bank 81.70 86.44 82.84 83.43 79.27 76.37 81.68 8
Interpretation- According to the research in table 2.2, South Indian Bank's assets quality
(93.21) is much higher than that of other banks. With an average of 92.14, Oriental Bank of
Commerce came in second, followed by Punjab National Bank (91.97) and Bank of Baroda
(85.24). HDFC Bank is in last place with the lowest average value of (76.39).
Table 2.3: Ratio of Interest Income to Total Assets

Banks Interest Income to Total Assets
2014 2015 2016 2017 2018 2019 Avg Rank
Bank of Baroda 6.87 7.37 7.08 6.45 6.25 6.36 6.73 12
Bank of India 6.95 7.74 7.62 7.39 7.29 6.80 7.30 11
Canara Bank 7.64 8.69 8.67 8.75 8.41 8.00 8.36 6
Oriental Bank of 8.09 9.33 9.36 9.03 8.86 8.57 8.87 4
Commerce
ICICI Bank 6.75 7.49 7.81 7.81 7.91 7.72 7.58 10
HDFC Bank 7.97 9.06 9.50 9.22 8.96 9.27 9.00 3
Axis Bank 7.16 8.33 8.68 8.47 8.40 8.30 8.22 8
Interpretation- Kotak Bank placed first with the highest average value (10.36), followed by
South Indian Bank (9.32) and HDFC Bank (9.00) on second and third place, respectively,
according to Table 2.3. With a score of 6.73, Bank of Baroda is in last place, followed by
Bank of India and ICICI Bank, respectively.
Table 2.4: Composite Assets Quality

Net NPA to Secured Interest Group Rank

Banks Net Advances Advances Income
to Total to Total
Advances Assets
Bank of Baroda 1.77 6 85.24 4 6.73 12 7.33 8
Bank of India 2.93 10 82.07 7 7.30 11 9.33 12
Canara Bank 2.63 9 80.03 11 8.36 6 8.67 10
Punjab National Bank 3.37 12 91.97 3 8.26 7 7.33 8
Oriental Bank of 3.05 11 92.14 2 8.87 4 5.67 4
Commerce
ICICI Bank 1.36 5 84.03 6 7.58 10 7.00 7
HDFC Bank 0.23 1 76.39 12 9.00 3 5.33 3
Axis Bank 0.43 2 81.68 8 8.22 8 6.00 5
Kotak Mahindra Bank 0.84 3 81.43 9 10.36 1 4.33 2
Interpretation- Based on a review of the group averages for the three asset quality ratios
presented in Table 2.4. The results show that South Indian Bank took the top spot with a group
average rank of 2.33, followed by Kotak Bank (4.33) and HDFC Banks (5.33) in that order.
Due to its subpar performance in all three measures, Bank of India received the lowest
ranking, with a 9.33 group average rank
5.3 Management Quality:
Table 3.1: Return on Advances
Banks Return on Advances

2014 2015 2016 2017 2018 2019 Avg Rank
Bank of Baroda 8.02 8.67 8.40 7.69 7.47 7.34 7.93 12
Bank of India 8.12 8.76 8.60 8.22 8.20 7.98 8.31 11
Canara Bank 8.96 10.57 10.27 10.48 10.16 9.58 10.00 5
Oriental Bank of 9.98 11.62 11.42 10.87 10.65 10.06 10.77 4
Commerce
ICICI Bank 8.26 9.42 10.05 9.99 9.81 9.47 9.50 9
HDFC Bank 10.56 11.89 12.33 11.68 11.12 10.80 11.40 3
Axis Bank 8.43 9.85 10.45 10.28 10.12 9.69 9.80 7
Interpretation- This ratio shows how effectively and productively a specific bank uses its
human resources. Kotak Bank came in first with the highest average of 13.38, as shown in
table 3.1, and was followed by South Indian Bank (11.46). Bank of Baroda is in the bottom
spot with a 7.93 average.
Table 3.2: Business Per Employee (in Rupees Million)

Banks Business Per Employee (in Rupees Million)
2014 2015 2016 2017 2018 2019 Avg Rank

Bank of Baroda 122.90 146.60 168.90 186.50 188.90 168.00 163.63 2
Bank of India 128.40 136.00 158.20 196.30 206.90 179.60 167.57 1
Canara Bank 119.91 137.44 142.02 143.84 143.50 144.46 138.53 4
Punjab National 101.78 113.20 116.51 128.30 131.90 135.90 121.27 7
Bank
Oriental Bank of 141.80 146.22 162.03 170.97 174.25 168.87 160.69 3
Commerce
ICICI Bank 73.50 70.80 73.50 74.70 83.20 94.30 78.33 11
HDFC Bank 65.30 65.40 75.00 89.00 101.00 113.90 84.93 10
Axis Bank 136.60 127.60 121.50 123.00 137.10 148.40 132.37 5
Kotak Mahindra 53.50 61.30 68.60 67.80 70.50 75.10 66.13 12
Bank
human resources. Table 3.2 shows that Bank of India came in first with an average of 167.57
million, followed by Bank of Borda (163.63 million) and Oriental Bank of Commerce (160.69
million), which came in second and third, respectively. With a score of 66.13 Million, Kotak
Bank is in last place. The performance of the bank is improved by a larger Business per
Employee Ratio.
Table 3.3: Profit Per Employee (in Rupees Million)
Banks Profit Per Employee (in Rupees Million)
2014 2015 2016 2017 2018 2019 Avg Rank
State Bank of 0.39 0.53 0.65 0.49 0.60 0.47 0.52 8
India
Bank of Baroda 1.10 1.20 1.00 1.00 0.70 -1.00 0.67 5
Bank of India 0.62 0.64 0.64 0.63 0.37 -1.22 0.28 12
Canara Bank 0.98 0.82 0.70 0.50 0.50 -0.50 0.50 10
Punjab National 0.84 0.84 0.81 0.50 0.50 -0.60 0.48 11
Bank
Oriental Bank of 0.90 0.62 0.70 0.58 0.25 0.07 0.52 9
Commerce
Union Bank of 0.80 0.60 0.70 0.50 0.50 0.40 0.58 7
India
ICICI Bank 1.00 1.10 1.40 1.40 1.60 1.40 1.32 2
HDFC Bank 0.74 0.80 1.00 1.20 1.00 1.50 1.04 3
Axis Bank 1.40 1.40 1.50 1.50 1.70 1.80 1.55 1
Kotak Mahindra 0.80 0.90 1.00 1.00 1.10 0.70 0.92 4
Bank
South Indian 0.50 0.70 0.80 0.70 0.40 0.40 0.58 6
Bank
human resources. Axis Bank was placed first with the highest average of 1.55 million,
followed by ICICI Bank (1.32 million), HDFC Bank (1.04 million), and Kotak Bank (.92
million) in that order in table 3.3. The lowest rank was achieved by Bank of India, which
received a score of.28 Million. The efficiency of the bank in maximising profit increases with
the ratio of profit to employees.
Table 3.4: Composite Management Quality
Source: Authors calcuation
Banks Return on Business Per Profit Per Group Rank

Advances Employee Employee
% Rank Million Rank Million Rank Avg Rank
State Bank of 9.08 10 102.60 9 0.52 8 9.00 12
India
Bank of Baroda 7.93 12 163.63 2 0.67 5 6.33 6
Bank of India 8.31 11 167.57 1 0.28 12 8.00 10
Canara Bank 10.00 5 138.53 4 0.50 10 6.33 6
Punjab National 9.85 6 121.27 7 0.48 11 8.00 10
Bank
Oriental Bank of 10.77 4 160.69 3 0.52 9 5.33 2
Commerce
Union Bank of 9.58 8 128.35 6 0.58 7 7.00 8
India
ICICI Bank 9.50 9 78.33 11 1.32 2 7.33 9
HDFC Bank 11.40 3 84.93 10 1.04 3 5.33 2
Axis Bank 9.80 7 132.37 5 1.55 1 4.33 1
Kotak Mahindra 13.38 1 66.13 12 0.92 4 5.67 5
Bank
South Indian 11.46 2 113.43 8 0.58 6 5.33 2
Bank
Interpretation- Based on a review of the group averages for the three management quality
ratios as shown in Table 3.4. With a group average score of 4.33, Axis Bank came in first,
followed by HDFC Bank, South Indian Bank, and Oriental Bank of Commerce, in that order.
As a result of its subpar performance in all three measures, State Bank of India received the
lowest ranking, with a group average rating of 9.00.
5.4 Earning Quality:-

Table 4.1: Ratio of Operating Profits to Total Assets
Banks Operating Profits to Total Assets
2014 2015 2016 2017 2018 2019 Avg Rank
Bank of Baroda 2.19 2.13 1.81 1.54 1.44 1.27 1.73 9
Bank of India 1.72 1.82 1.78 1.64 1.26 0.98 1.53 12
Canara Bank 2.03 1.67 1.50 1.50 1.34 1.30 1.56 11
Punjab National 2.68 2.54 2.33 2.21 2.07 1.92 2.29 5
Bank
Oriental Bank of 2.17 1.85 1.95 1.97 1.75 1.57 1.88 7
Commerce
ICICI Bank 2.35 2.32 2.57 2.93 3.18 3.49 2.81 4
HDFC Bank 3.09 3.05 3.10 3.22 3.22 3.29 3.16 1
Axis Bank 3.03 2.81 2.97 3.17 3.17 3.26 3.07 2
Kotak Mahindra 3.00 2.84 2.89 3.01 3.10 2.71 2.93 3
Bank
Interpretation- This ratio shows how much money a bank makes from its operations after
covering operating expenses for each asset investment. Operating profit divided by total assets
is used to calculate it. According to table 4.1, HDFC Bank came in first with an average of
3.16, followed by Axis Bank (3.17) and Kotak Bank (2.93), in that order. The lowest ratio,
1.53, belongs to Bank of India.
Table 4.2: Return on Assets

Banks Return on Assets

2014 2015 2016 2017 2018 2019 Avg Rank
Bank of Baroda 1.33 1.24 0.90 0.75 0.49 -0.78 0.66 9
Bank of India 0.82 0.72 0.65 0.51 0.27 -0.94 0.34 12
Canara Bank 1.42 0.95 0.77 0.54 0.55 -0.52 0.62 10
Punjab National 1.34 1.19 1.00 0.64 0.53 -0.61 0.68 7
Bank
Oriental Bank of 1.03 0.67 0.71 0.56 0.23 0.07 0.55 11
Commerce
ICICI Bank 1.35 1.50 1.70 1.78 1.86 1.49 1.61 4
HDFC Bank 1.58 1.77 1.90 2.00 2.02 1.92 1.87 1
Axis Bank 1.68 1.68 1.70 1.78 1.83 1.72 1.73 2
Kotak Mahindra 1.77 1.83 1.81 1.80 1.98 1.19 1.73 3
Bank
Interpretation- Return on Assets is a gauge of a bank's profitability. It is determined by

dividing net profit after tax by total assets. In table 4.2, HDFC Bank was ranked first with an
average of 1.87, followed by Axis Bank (1.73) and Kotak Bank (1.73), in that order. The Bank
of India had the lowest ranking with a score of 0.34 on average.
Table 4.3: Ratio of Net Interest Income to Total Assets (Net Interest Margin)
Banks Net Interest Income to Total Assets (Net Interest Margin)

2014 2015 2016 2017 2018 2019 Avg Rank
Bank of Baroda 2.76 2.56 2.28 1.98 1.92 1.84 2.22 10
Bank of India 2.49 2.26 2.16 2.11 1.91 1.91 2.14 11
Canara Bank 2.56 2.17 2.00 1.98 1.86 1.77 2.06 12
Oriental Bank of 2.80 2.49 2.49 2.44 2.26 2.30 2.46 9
Commerce
ICICI Bank 2.34 2.40 2.70 2.91 3.07 3.11 2.76 6
HDFC Bank 4.22 4.19 4.28 4.14 4.14 4.25 4.20 2
Axis Bank 3.10 3.04 3.09 3.30 3.37 3.41 3.22 3
Interpretation- The ratio of net interest income to total assets is used to measure it (Net
Interest Margin). A greater ratio suggests that the bank is more profitable. In table 4.3, Kotak
Bank was rated first with an average of 4.45, followed by HDFC Bank (4.20) and Axis Bank
(3.22), in that order. Canara Bank had the lowest ranking and the lowest average score (2.06).
Table 4.4: Composite Earning Quality

Banks Operating Return on Net Interest Group Rank
Profits to Assets Income to Total
Total Assets Assets
Bank of Baroda 1.73 9 0.66 9 2.22 10 9.33 10
Bank of India 1.53 12 0.34 12 2.14 11 11.67 12
Canara Bank 1.56 11 0.62 10 2.06 12 11.00 11
Punjab National
Bank 2.29 5 0.68 7 3.05 4 5.33 5
Oriental Bank of
Commerce 1.88 7 0.55 11 2.46 9 9.00 9
ICICI Bank 2.81 4 1.61 4 2.76 6 4.67 4
HDFC Bank 3.16 1 1.87 1 4.20 2 1.33 1
Axis Bank 3.07 2 1.73 2 3.22 3 2.33 2
Kotak Mahindra
Bank 2.93 3 1.73 3 4.45 1 2.33 2
Interpretation- Based on a review of the group averages for the three earning quality ratios as
shown in Table 4.4. It was discovered that HDFC Bank came in first place with a group
average rank of 1.33, followed by Axis Bank and Kotak Bank (2.33) in that order. Due to its
poor performance in all three measures, Bank of India received the lowest ranking, with a
group average rating of 11.67.
5.5 Liquidity:-
“Cash-Deposit Ratio is the ratio of ho much a bank lends out of the deposits it has mobilized.
It indicates how much of a banks’s core funds are being used for lending, the main banking
activity. it can also be defined as total of cash in hand and balance with RBI divided by total
deposit .” (RBI 2005 to 2016. It ensure customer that they will be able to take their money out
of the bank if they want to.
Table 5.1 Cash-Deposit Ratio
Banks Cash-Deposit Ratio

2014 2015 2016 2017 2018 2019 Avg Rank
State Bank of India
10.11 5.18 5.47 6.09 7.35 7.49 6.95 2
Bank of Baroda
6.50 5.63 2.84 3.27 3.64 3.78 4.28 12
Bank of India
7.29 4.71 5.75 4.00 5.11 6.62 5.58 6
Canara Bank
7.50 5.44 4.33 5.27 4.64 4.31 5.25 10
Punjab National
Bank 7.60 4.87 4.57 4.93 4.83 4.78 5.26 9
Oriental Bank of
Commerce 6.84 5.43 4.65 5.16 4.99 4.52 5.27 8
Union Bank of
India 8.70 5.22 4.08 6.19 4.75 4.55 5.58 5
ICICI Bank
9.27 8.01 6.51 6.57 7.10 6.43 7.32 1
HDFC Bank
12.03 6.08 4.94 6.90 6.10 5.50 6.93 3
Axis Bank
7.34 4.86 5.86 6.07 6.15 6.25 6.09 4
Kotak Mahindra
Bank 7.20 5.23 4.33 4.99 5.25 4.98 5.33 7
South Indian Bank
6.15 4.31 3.83 4.63 4.70 4.44 4.68 11
Interpretation- It is found in table 5.1 that ICICI Bank ranked on the top position with the
highest average of 7.32 followed by State Bank of India (6.95) and HDFC Bank (6.93)
respectively. Bank of Baroda scored the lowest position with least average of 4.28.
Table 5.2: Credit-Deposit Ratio

Banks Credit-Deposit Ratio
2014 2015 2016 2017 2018 2019 Avg Rank
Bank of Baroda 74.87 74.67 69.25 69.79 69.32 66.85 70.79 11
Bank of India 71.30 78.20 75.78 77.73 75.58 70.02 74.77 8
Canara Bank 72.00 71.09 68.05 71.56 69.65 67.68 70.01 12
Punjab National 77.38 77.39 78.86 77.38 75.90 74.55 76.91 7
Bank
Oriental Bank of 68.97 71.80 73.31 71.88 71.20 71.26 71.40 10
Commerce
Union Bank of 74.58 79.81 78.90 76.96 80.68 78.01 78.16 6
India
ICICI Bank 95.91 99.31 99.19 102.05 107.18 103.28 101.15 1
HDFC Bank 76.70 79.21 80.92 82.49 81.08 85.02 80.90 5
Axis Bank 75.25 77.13 77.97 81.89 87.17 94.64 82.34 4
Kotak Mahindra 100.2 101.41 94.98 89.77 88.38 85.59 93.39 2
Bank 3
Interpretation- The credit-deposit ratio reveals the loans made by banks using their deposits.
Table 5.2 shows that ICICI Bank came in first with an average of 101.15, followed by Kotak
Bank (93.39) and State Bank of India (84.15), in that order. Canara Bank had the lowest
ranking and the lowest average score (70.01).
Table 5.3: Investment-Deposit Ratio

Banks Investment-Deposit Ratio
2014 2015 2016 2017 2018 2019 Avg Rank
Bank of Baroda 23.38 21.62 25.62 20.41 18.92 20.98 21.82 12
Bank of India 28.73 27.26 24.78 23.93 22.52 23.17 25.07 11
Canara Bank 28.50 31.21 34.04 30.15 29.98 29.66 30.59 7
Punjab National 30.41 32.33 33.17 31.85 29.89 28.54 31.03 6
Bank
Oriental Bank of 35.63 33.41 33.29 31.77 30.41 31.43 32.66 5
Commerce
ICICI Bank 59.70 62.45 58.57 53.33 43.73 38.06 52.64 1
HDFC Bank 34.00 39.51 37.68 32.93 33.64 29.99 34.63 4
Axis Bank 38.04 42.34 45.02 40.42 36.46 34.08 39.39 3
Kotak Mahindra 58.51 55.96 56.58 43.14 38.28 36.97 48.24 2
Bank
Interpretation- The investment-deposit ratio shows the advances that banks have lent
through their deposits. Table 5.3 shows that ICICI Bank came in first with an average of
52.64, followed by Kotak Bank (48.24), and AXIS BANK (39.39), in that order. Bank of
Baroda had the lowest ranking and the lowest overall average (21.82).
Table 5.4: Composite Liquidity
Banks Cash-Deposit Credit-Deposit Investment- Group Rank

Ratio Ratio Deposit Ratio
State Bank of India
6.95 2 84.15 3 29.58 8 4.33 5
Bank of Baroda
4.28 12 70.79 11 21.82 12 11.67 12
Bank of India
5.58 6 74.77 8 25.07 11 8.33 9
Canara Bank
5.25 10 70.01 12 30.59 7 9.67 10
Punjab National
Bank 5.26 9 76.91 7 31.03 6 7.33 7
Oriental Bank of
Commerce 5.27 8 71.40 10 32.66 5 7.67 8
Union Bank of India
5.58 5 78.16 6 28.61 9 6.67 6
ICICI Bank
7.32 1 101.15 1 52.64 1 1.00 1
HDFC Bank
6.93 3 80.90 5 34.63 4 4.00 4
Axis Bank
6.09 4 82.34 4 39.39 3 3.67 2
Kotak Mahindra
Bank 5.33 7 93.39 2 48.24 2 3.67 2
South Indian Bank
4.68 11 72.94 9 27.94 10 10.00 11
Interpretation- Based on a review of the group averages for the three liquidity ratios presented
in Table 5.4. With a group average rank of 1.00, it was discovered that ICICI Bank came in
first, followed by Axis Bank and Kotak Bank (3.67). Due to its subpar performance in all three
measures, Bank of Boroda received the lowest ranking with a group average rating of 11.67.
5.6 Composite Ranking of Selected Commercial Banks

Banks C A M E L Average Rank
State Bank of India 6.33 8.67 9.00 5.67 4.33 6.80 6
Bank of Baroda 5.33 7.33 6.33 9.33 11.67 8.00 10
Bank of India 10.33 9.33 8.00 11.67 8.33 9.53 12
Canara Bank 8.33 8.67 6.33 11.00 9.67 8.80 11
Punjab National 9.00 7.33 8.00
Bank 5.33 7.33 7.40 8
Oriental Bank of 8.67 5.67 5.33
Commerce 9.00 7.67 7.27 7
Union Bank of India 10.00 6.00 7.00 8.00 6.67 7.53 9
ICICI Bank 1.33 7.00 7.33 4.67 1.00 4.27 4
HDFC Bank 2.67 5.33 5.33 1.33 4.00 3.73 1
Axis Bank 3.67 6.00 4.33 2.33 3.67 4.07 2
Kotak Mahindra 5.00 4.33 5.67
Bank 2.33 3.67 4.13 3
South Indian Bank 7.33 2.33 5.33 7.33 10.00 6.47 5
Source: Authors Calculation
Interpretation- We developed a composite rating in order to evaluate the overall effectiveness
of public and private sector banks, and the findings are shown in Table 5.6. depicts the public
and private sector banks' group rankings from 2011 to 2016. According to the criteria for
capital adequacy ratios, ICICI Bank came in first, while Bank of India came in last. South
Indian Bank ranked highest on the assets quality criterion, while Bank of India received the
lowest ranking. Axis Bank was ranked highest and State Bank of India was ranked lowest in
terms of management effectiveness. HDFC Bank ranked first in terms of the earning quality
criterion, while Bank of India received the lowest score.Under the liquidity parameter ICICI
Bank stood on the top position and Bank of Baroda was on the lowest position. Taking a
consolidated view, it can be depicted from the analysis that HDFC bank is at the top position
followed by Axis bank. Kotak bank occupied the third position and last position is occupied
by Bank of India amongst all the selected banks during the period of 2011-2016.
6 Conclusion
CAMEL model is considered as an important tool to analyze the financial performance of the
banks and suggest necessary measures to improve their performance over there weaknesses.
This study is done to analyze and compare the performance of public and private sector banks
during the period of 2014 - 2019 by using the CAMEL rating technique. This study consists
the sample of 12 commercial banks operating in India out of which seven were public sector
banks and five were private sector banks. From the result of data analysis and interpretation, it
is found that in terms of capital adequacy ratios, ICICI Bank came out on top, while Bank of
India received the lowest ranking. South Indian Bank ranked highest for the assets quality
criterion, while Bank of India received the lowest ranking. Axis Bank came out on top in the
managerial efficiency metric, while State Bank of India received the lowest score. HDFC
Bank ranked first in terms of the earning quality criterion, while Bank of India received the
lowest score. Bank of Baroda was ranked last and ICICI Bank was ranked first under the
liquidity criterion. When looking at the data as a whole, it is clear from the study that HDFC
Bank is in the lead, followed by Axis Bank.
Out of all the chosen banks, Kotak Bank held the third rank, and Bank of India had the final
spot. Results indicate that private sector banks perform better than public sector banks.
Therefore, public sector banks must increase their performance in order to reach the top
positions and the necessary level.
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Comparative Performance Analysis of Selected

Commercial Banks in India: Camel Model

Keywords: CAMEL analysis, financial performance, Commercial Banks.

ICASDMBW 2022, December 16-17, Delhi, India

Table 1: Description of Calculated Financial Ratios Under CAMEL Model

Capital Secured Business Per Return on Assets Credit-Deposit

5.1. Capital Adequacy: -

Interpretation- In contrast to the 8% recommended in Basel protocols, the RBI requires

Table 1.2: Capital Adequacy Ratio - Tier I

2014 2015 2016 2017 2018 2019 Avg Rank

Table 2.3: Ratio of Interest Income to Total Assets

Table 2.4: Composite Assets Quality

Net NPA to Secured Interest Group Rank

Banks Return on Advances

Table 3.2: Business Per Employee (in Rupees Million)

Banks Business Per Employee (in Rupees Million)

2014 2015 2016 2017 2018 2019 Avg Rank

Banks Return on Business Per Profit Per Group Rank

5.4 Earning Quality:-

Table 4.2: Return on Assets

Banks Return on Assets

Interpretation- Return on Assets is a gauge of a bank's profitability. It is determined by

Banks Net Interest Income to Total Assets (Net Interest Margin)

Table 4.4: Composite Earning Quality

Banks Cash-Deposit Ratio

Table 5.2: Credit-Deposit Ratio

Table 5.3: Investment-Deposit Ratio

Banks Cash-Deposit Credit-Deposit Investment- Group Rank

5.6 Composite Ranking of Selected Commercial Banks

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