The study has a great significance in knowing the working capital of the bank. The main aim of this study is to analyze the efficiency of current assets and current liabilities management. This study attempts to comprise the financial performance of the bank. This study is based on the analysis of the balance sheet and profit and loss account for the past five years , in order to analyze the effectiveness of the financial performance of the firm.. The balance sheet and profit and loss account of past six years are taken as a tool data collection .
Indian overseas bank was founded on February 10, 1937 by Shri .M.Ct.M.Chidambaram Chettiyar. It is a leading bank based in Chennai, India. Since IOB aimed to encourage overseas banking and foreign exchange operations, it soon opened its branches in Penang and Singapore. Today, Indian Overseas Bank boasts of a vast domain in banking sector with over 1400 domestic branches and 6 branches overseas. . After nationalization, the Bank emphasized on opening its branches in rural parts of India. In 1979, IOB opened a Foreign Currency Banking Unit in the free trade zone in Colombo.
In the year 2000, Indian Overseas Band undertook an initial public offering (IPO) that brought the government's share in the bank's equity down to 75%. The equity shares of IOB are listed in the Madras Stock Exchange (Regional), Bombay Stock Exchange, and National Stock Exchange of India Ltd., Mumbai. Since its inception, IOB has absorbed various banks including the latest ² Bharat Overseas Bank ² in 2007. The Bank's IT department has developed software, which is used by its 1200 branches to provide online banking to customers.
1.INDIAN OVERSEAS BANK CREDIT CARDS 2. INDIAN OVERSEAS BANK AUTO LOANS 3.INDIAN OVERSEAS BANK PERSONAL LOAN 4.INDIAN OVERSEAS BANK FIXED DEPOSITS
PRIMARY OBJECTIVE: To study the working capital management of Indian overseas bank. SECONDARY OBJECTIVE: 1. To find out the past five years financial performance by analyzing the working capital of IOB. 2. To find out the financial performance through ratio analysis of IOB. 3. To find out the trend analysis of IOB.
There is a need for working capital management to avoid the problems that may occur due to lack of funds. Effective working capital management has a crucial role to play in enhancing the profitability and growth of the firm. Working capital management is important to maximize the shareholders wealth.
1. The working capital is used to determine the liquidity position of the IOB 2. Ratios helps to know operational efficiency by comparison of present ratios with those of other firms and financial services. 3. Trend analysis is significant for forecasting and budgeting. Trend analysis discloses the changes in financial and operating data between specific periods. 4. To know the efficiency of the study unit and the efficient management of the capital, the working capital ratios are prepared.
The data¶s are mostly collected from secondary source. The are no set rules or formula to determine the working capital requirement of IOB. Ratios are interrelated and therefore a single ratio cannot convey any meaning.
Working Capital:Working capital is the fund available for meeting day-to-day requirements. Difference between current asset and current liabilities is called working capital . Current Assets:Current assets are resources, which are in cash or will soon be converted into cash within accounting year. Current Liabilities:Current liabilities are commitments, which will soon require settlement within the accounting year.
A) A study on working capital management with special reference to HMT machine tools Ltd, Kalamassery was done by Ms.Smitha Saviour on June 2007. The objective of the study is to analyze the liquidity position of the company, to compute the average collection and payment period and to analyze the short term solvency of the concern. The conclusion of the study is that the working capital of the company is found not satisfactory. Analyzing the various liquidity ratios, it is found that all the liquidity ratios are not good than the normal concepts. The large holding of current asset strengthens firms liquidity position but it also reduces the overall profitability. Effort of reducing working capital is a continuous exercise and it is an opportunity for improvement.
B) A study on working capital management in APOLLO tyres Ltd, Kochi was done by Ms.Faizal.A on June 2007. The objective of the study is to analyze the management of different components of working capital in the concern to examine the liquidity position of the company, to compute the average collection period and to project the working capital needs of the company. The conclusion of the study is that the sufficient working capital should be maintained. The performance of the company is very impressive. The company¶s financial management and inventory management departments are working very effective and efficient. The suggestions made will be of much useful to the company for their better management of working capital.
R esearch Design: Descriptive research.
Collection of data: The secondary data were collected for the analysis of ratio and working capital for past 5 years. For measuring the adequacy of working capital, current ratio, acid test ratios are computed. For analyzing the growth of the company, trend of each component is calculated.
PER IOD OF STUDY: The period of study covers five years from 2006 to 2010.
TOOLS USED FOR ANALYSIS: To analyze the Working Capital Management the following tools and techniques are used x
Ratio analysis
x
Working Capital Analysis
x
Trend analysis.
