A recent press report said that Indian Bank has topped the list among the PSU banks by recording highest returns on assets for the financial year ended March, 2011. Indian Bank has recorded a Return on Assets (RoA) of 1.53 per cent for 2010-11, which is the highest among 21 public sector banks. The lowest RoA was generated by Bank of Maharashtra at 0.47 per cent.
RoA indicates the profit of a company compared to its total assets. It gives an idea of the efficiency of the management in using its assets to generate earnings. Canara Bank holds the second place in the list with RoA of 1.42 per cent at the end of 2010-11 and Andhra Bank with 1.36 per cent, according to the analysis. The country’s largest lender State Bank of India has recorded a RoA of 0.71 per cent. A Good performance in giving loan has also helped banks improve their margins.
As per press reports the Provision Coverage Ratio, as per the analysis, Indian Bank has topped the list with the ratio of 84.3 per cent. The Reserve Bank has prescribed a minimum PCR of 70 per cent. Andhra Bank with PCR of 83.9 per cent is second in the chart followed by Delhi-based Punjab & Sind Bank with 81.8 per cent.