A Comparative Study Of Financial Performance Of Crdb And Nbc Banks An Application Of Camels Model

ABSTRACT

The study was done on comparative of the financial performance between two financial Institutions CRDB and NBC, these two banks were selected as a sample .The study on the comparative financial performance of CRDB and NBC has been an important issue in the field of banking services. The focus was on the performance of CRDB which is a growing bank in Tanzania and very competitive among other banks while NBC is an average bank which has been experiencing operations problems in recently years. Two banks were selected because of minimizing the computation on Capital adequacy, Asset Quality, Management efficiency, Earning ratio and liquidity of each bank. Secondary data were used for this comparative study, financial statements of each bank from 2012 to 2016 were compared and analyzed using the CAMELS Rating Analysis approach, to show which bank has good financial performance in terms of Capital Adequacy, Asset quality, management efficiency, Earning ratio and Liquidity. The Result of the study revealed that, NBC had performed relatively well and ranked number one in an overall performance on Capital on Capital Adequacy, Asset quality, management efficiency, Earning ratio and Liquidity. While CRDB became number two in terms of the performance on the same mentioned variables. The study concludes that, the composite CAMELS rating revealed variations among the observed banks (CRDB and NBC). Even if all the banks were compositely rated as fair, they had differences when each component and their aggregate average were considered. This variation helps to compare and rank banks based on their financial performance, apart from triggering regulatory, supervisory and administrative concerns which must be addressed.