Central Bank of India Closing Price: Rs 149.55

Central Bank with a network of 3,559 branches is the 10th largest in terms of assets. The bank has seen a robust performance
since 2006, increasing from Rs. 4,980 million to Rs. 10,582.3 million for FY10. The RoE has improved from 9.1% to 24.20% from
FY06 to FY10, where as, the RoA has improved from 0.4% to 0.66% in the same period. However, the NIM has fallen from 3.5%
to 1.8% primarily on account of higher cost of funding and a fall in investment yields. The total CAR (Basel II) for FY10, stood at
12.24% and the Tier 1 ratio stood at 6.83%. The bank is currently looking at raising Rs. 10 billion through a bond issue coupled
with recapitalization money which it expects to receive from the Central Government under the recapitalization plan.
The bank has witnessed an improvement in it's asset quality with net NPA ratio falling from 2.6% to 0.69%. Apart from this the
bank has also witnessed an improvement in RoE and RoA. Going forward, the bank is expected to improve it's NIM's moderately
along with a continued focus on CASA deposits. Also, the share of non-interest income has been on a rise, increasing from 18% in
FY06 to 26% in FY08 to 32% in FY09. Overall we expect the bank to continue with it's improving financial performance.

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