Know which commercial bank is cost efficient and which one is costlier (Exclusive study)
Wed, Aug 31, 2016 4:23 PM on Latest, Exclusive, Financial Analysis, Featured, Stock Market,
ShareSansar.com have compared the staff expenses of commercial banks to its paid up capital, revenue, total operating income and total expenses. (The study also includes staff bonus in while studying staff expenses in some heading.)
The analysis shows that government owned commercial banks have more staff expense than other commercial banks. Agricultural Development Bank Limited (ADBL), Nepal Bank Limited (NBL) and Rastriya Banijya Bank Limited (RBBL) have the highest staff expenses. Number of branches, number of staffs and business expansion are also some factors for increased staff expenses.
Number of Branch, number of Staff and business expansion are also the factors for increment of staff expenses.
2.Staff Expenses plus Staff Bonus divided by Total Expenses:
Out of total expenses, staff expenses including bonus coverage is more than 50% in all the commercial banks. Staff expense of NBL covers 80.19% of the total expenses of the bank whereas staff expense of ADBL covers 80.15% of the total expenses. The staff expense of Century Commercial Bank Limited (CCBL) covers 50.17% of the total expenses which is the lowest expense coverage among all the commercial banks.
3.Total Expenses (Excluding Interest Expenses) Divided by Revenue:
Total expense (excluding the interest expense) covers 31.34 percent in average of the total revenue of commercial banks. The total expense of NBL covers 50.36% of its total revenue which is the highest among all commercial banks. The total expense of Prime Commercial Bank Limited (PCBL) covers 17.51% of its total revenue which is the lowest when compared with other commercial banks. ADBL, Standard Chartered Bank Limited (SCB), Himalayan Bank Limited (HBL), RBBL and Prabhu Bank Limited (PRVU) total expense covers more than 40% of its total revenue.
5. Staff Expenses By Capital: The staff expense of Nepal Bank covers 40.00% of the total paid up capital. Staff expense of Everest Bank Limited (EBL) covers 34.75% of its total paid up capital. Staff expense of eighteen banks cover less than average percent of total paid up capital whereas ten banks cover more than average staff expenses of its paid up capital.
- Staff Expenses (Excluding Bonus) Divided by Total operating Income: The average staff expense of commercial bank is 20.18 percent excluding the staff bonuses of total operating income. The above data shows that the government bank staff expense is more than 35 percent of the total operating income. Except ADBL and NBL, staff expense of all the banks is below 30 percent of total operating income. If ADBL , NBL and RBBL are excluded from the list then the average staff expense of all commercial banks will hover around 17.77 percent of total operating income.
2.Staff Expenses plus Staff Bonus divided by Total Expenses:
Out of total expenses, staff expenses including bonus coverage is more than 50% in all the commercial banks. Staff expense of NBL covers 80.19% of the total expenses of the bank whereas staff expense of ADBL covers 80.15% of the total expenses. The staff expense of Century Commercial Bank Limited (CCBL) covers 50.17% of the total expenses which is the lowest expense coverage among all the commercial banks.
3.Total Expenses (Excluding Interest Expenses) Divided by Revenue:
Total expense (excluding the interest expense) covers 31.34 percent in average of the total revenue of commercial banks. The total expense of NBL covers 50.36% of its total revenue which is the highest among all commercial banks. The total expense of Prime Commercial Bank Limited (PCBL) covers 17.51% of its total revenue which is the lowest when compared with other commercial banks. ADBL, Standard Chartered Bank Limited (SCB), Himalayan Bank Limited (HBL), RBBL and Prabhu Bank Limited (PRVU) total expense covers more than 40% of its total revenue.
- Staff Expenses Divided By Total Expenses: The average staff expense of commercial (excluding staff bonus) under this heading is 52.35%. Staff expense of ADBL covers 83.76% and NBL covers 78.03% out of their total expenses which turns out to be the highest as well. Government owned banks have soaring staff expenses due to huge number of staffs and their beneficiary facilities.
5. Staff Expenses By Capital: The staff expense of Nepal Bank covers 40.00% of the total paid up capital. Staff expense of Everest Bank Limited (EBL) covers 34.75% of its total paid up capital. Staff expense of eighteen banks cover less than average percent of total paid up capital whereas ten banks cover more than average staff expenses of its paid up capital.
