A STUDY ON RATIO ANALYSIS OF PUBLIC SECTOR BANKS

Abstract

This study examines the financial performance of ten selected Public Sector Banks (PSBs) in India — State Bank of India, Bank of Baroda, Punjab National Bank, Canara Bank, Union Bank of India, Bank of India, Indian Bank, Central Bank of India, Indian Overseas Bank, and Bank of Maharashtra — over the five-year period 2022–2026, using financial ratio analysis. The study is descriptive in nature and is based on secondary data drawn from published annual reports and other credible financial sources. Six key ratios — Current Ratio, Return on Assets, Return on Equity, Net Profit Margin, Debt-to-Equity Ratio, and Cost-to-Income Ratio — are used to assess the liquidity, profitability, solvency, and operational efficiency of the selected banks, with descriptive statistics and ANOVA applied to summarise the data and test for significant differences among the banks. The results show that the financial performance of the selected PSBs varies considerably in terms of profitability, cost management, capital structure, and efficiency, with several banks recording consistent improvement over the period and others showing greater scope for improvement; Bank of Maharashtra emerged as the strongest overall performer. The study concludes that financial ratio analysis remains an effective tool for evaluating bank performance and offers useful evidence for management, investors, researchers, and policymakers seeking to strengthen the financial management and productivity of Public Sector Banks.