Study on short-run financial position of banks: A case study of SBI Vs ICICI

Banking as a system act as central processing unit for the whole financial system. It is said to be an effective facilitator of mobilization of funds i.e. transforming funds from unproductive sector to productive sector. It is mechanism to process the fund for economic development. An effective banking system reflects the position of an economy in a greater context. As a developing country India needs a hassle free banking system to meet the upcoming challenges which comes from both internal and external factors. In this study effort is given to measure the financial efficiency or position of major and leading public sector bank “State Bank of India (SBI)” and major private sector bank “Industrial Credit Investment Corporation of India (ICICI) Bank”. In this paper ratio analysis is used in a new perspective to measure the operational efficiency of both SBI and ICICI bank and comparison is made between them. The data used for this study is purely of secondary nature and the period of study ranges from the financial year 2007–08 to 2011–12. The study found that financial performance of SBI is sounder than Private sector leading bank ICICI.