Muslim Commercial Bank (Internship) 2 Chapter -8

8.1.1 CURRENT RATIO:

                                    Current Assets

Current Ratio  =                     

                                    Current Liabilities

Current Ratio (2007) =  157632035/341983955 = 0.46 times

Current Ratio (2006) = 123611109/288494993=0.428 Times

INTERPRETATION:

Current ratio of the Bank has increase 0.46 in 2007 as compared to 0.42 in 2006. This shows that liquidity of the Bank has increase. Although it increase the liquidity but it is favorable in the sense that it increase the profitability.

8.1.2 INTEREST MARGIN:

    Int. Income = Int. Income - Int. Expense x 100

                                    Int. Income

Interest Margin (2007) =         31786595-7865535 x 100 = 75.25%

                                                            31786595

Interest Margin (2006) =         25778061 –4525359 x 100 = 82.44%

                                                            25778061

         

NTERPRETATION:

The interest margin of the Bank has decreased from 82.44% percent in 2006 to 75.25% percent in 2007. This suggests management's efficiency to attract less costly deposits and make higher-yield investments.

8.1.3 NET PROFIT MARGIN:

Net Profit Margin       =          Profit After Taxation x 100

                                                    Interest Income

Net Profit Margin (2007) = 15265562x 100  =48.02%

                                                31786595       

Net Profit Margin (2006) = 12142398x 100/ 25778061= 47.10%