Liquidity and profitability analysis of Canara Bank's Dindigul branch

It is widely accepted that the failure of many commercial banks was the trigger for the current global financial crisis. Moreover liquidity and profitability of the banking sector in India has assumed primal importance due to intense competition, greater customer demands and changing banking reforms. Commercial banks are profit seeking organizations. The way the commercial banks handle their portfolio is how the profits are reflected in their books. Though banks want to make profits but at the same time they are concerned about liquidity and safety. In this context analysis and liquidity of commercial banks assumes considerable significance. A bank should maintain a sound liquidity that ensures including a cushion of unencumbered, high quality liquid assets, to withstand a range of stress events, including those involving the loss or impairment of both unsecured and secured funding sources. Supervisors should assess the adequacy of both a bank's liquidity profitability position and should take prompt action to improve its financial position. In this paper an attempt is made to analyse the liquidity, profitability and non-performing assets of Canara bank of Dindigul branch through simple percentage and ratio analysis.