EVALUATION OF LLOYDS BANKING GROUP AND ROYAL BANK OF SCOTLAND BANKING - Free Essay Example

Sample details Pages: 5 Words: 1405 Downloads: 3 Date added: 2017/06/26 Category Finance Essay Type Narrative essay Did you like this example? Purpose of selection- We selected the method of ratio analysis because it would give us a quantitative analysis of the performance of two banks over a period of 5 years. And the analysis of the performance with the ratios will lead us to a meaningful conclusion. Ratios calculated: Don’t waste time! Our writers will create an original "EVALUATION OF LLOYDS BANKING GROUP AND ROYAL BANK OF SCOTLAND BANKING" essay for you Create order Profitability Ratio It tells us that how well the bank has been in generating profit through its operations. Asset Utilisation It shows the expertise of the banks in generating sales through the use of its assets. Leverage Ratio- It gives an idea of the capital mix of the banks i.e. the extent to which they have used debt and equity in their capital structure. Liquidity Ratio Provides an idea of the liquidity position of the banks i.e. their ability to meet the short term commitments. We calculated individually all these ratios for the two banks over a period of 5 years to see how well have they been performing. Based on the ratios we would make our conclusion on the performance of the banks. The key ratios that we would compare are Return on Equity = Net Income/ Average total equity Return on Asset = Net Income/ Average total asset Asset Utilisation Ratio = Net Sales/ Average total assets Leverage Ratio = Assets/ Equity The ratios for the banks are RATIOS OF THE TWO BANKS These ratios help us in making a conclusion about the performance of the two banks. As can be seen from the Profitability ratios, over the period of last five years Lloyds banks has a greater Return on equity which suggests that they have been able to generate more value for the shareholders than Royal bank of Scotland. Also clear from the ratios is the fact that the profitability of both the banks has decreased over the last five years. RBS was in loss for last two years but Lloyds managed to maintain a small profit margin. We will further investigate the reason for this difference through our DuPont analysis. We decided to calculate the asset utilisation ratio to see how efficient has the banks been in utilising their assets to generate sales. It can be clearly seen from the ratios that Lloyds bank has been more efficient over the years, however the efficiency for both the banks have been going down which can be attributed to the recent financial crisis. Leverage ratio is to find the capital mix of both the banks i.e. what is the proportion of debt and equity in the capital structure. We calculated the leverage ratios and found that both the banks are highly geared with a leverage ratio between 20 to 30. However over the last five years Lloyds has been more geared than RBS. We calculated the liquidity ratio to have an idea of what is the liquidity position of these banks. We found that Lloyds has maintained a better liquidity position and is in a better position to meet its short term commitments. To make things more clear we drew some graphs of the key ratios to come up with the trends. By our analysis using the ratios we found that though the performance of the two banks has gone down over the period, Lloyds has been able to generate more profit than RBS by utilising its asset better. In their performance there is also a role played by leverage which we will discuss in the DuPont analysis. DuPont ANALYSIS- As we know that ROE measures the return that a bank generates on its equity for its shareholders. We apply the DuPont analysis to understand what drives the ROE i.e. which factors affect the ROE by decomposing it in some basic ratios. By doing this we can understand what brings the difference in ROE of the two banks. The DuPont analysis is based on- Where- -RETURN ON EQUITY = NET INCOME/ SHAREHOLDERS EQUITY -RETURN ON ASSET = NET INCOME/ TOTAL ASSET -LEVERAGE= TOTAL ASSET/ SHAREHOLDERS EQUITY -NET PROFIT MARGIN= NET INCOME/ REVENUE An indicator of gow much a company derives per one money unit of sales. -ASSET TURNOVER = REVENUE/ TOTAL ASSET -TAX BURDEN= NET INCOME/ EARNING BEFORE TAX Effect of taxes on ROE. It shows how much of a companys pretax profit it gets to keep. -INTEREST BURDEN= EARNING BEFORE TAX/ EARNING BEFORE INTEREST AND TAX It measures the effect of interest on ROE. Higher borrowing cost reduces ROE. -EBIT( Earning befor interest and tax) MARGIN= EBIT/ REVENUE It measures the effect of operating profit on ROE. This basically shows that ROE is directly affected by ROA and Leverage. ROA in turn is affected by net profit margin and asset turnover. If net profit margin is positive,higher the asset turnover higher is the ROA and if its negative, higher the asset turnover lower would be ROA. Net profit margin is affected by EBIT margin, Interest burden and Tax burden. If all these ratios are posive higher they are better is the ROE. We analysed the ROE using DuPont analysis for the last five years but have shown the flowchart for the last year to show how it works. LLOYDS DuPont ANALYSIS (2009) ROYAL BANK OF SCOTLAND DuPont ANALYSIS(2009) By doing this analysis we can understand what affected the ROE for the banks. The breakdown of ROE indicates that RBS lower profitability was due to a lower ROA which can be further investigated. The roots of a low ROA for RBS goes down to its negative interest burden, which basically reflects that the Earning before tax for RBS was in negative i.e. there was a loss. This loss is reflected in net profit margin and return on asset. Because of the high leverage the loss in ROA of -.16% is multiplied and is reflected as -2.82% in ROE. The opposite happens for Lloyds bank. Lloyds has a ROA of .28% but because of the equity multiplier of 20.96, the ROE becomes 5.77% which is a good return in the present conditions. A point to notice is the role of leverage in determining the ROE. It increases both profit and loss and thats why its said a double edged sword which should be used carefully. For both banks equity is just a small portion of total capital. If we look at the DuPont analysis of RBS for a period of 5 years, we can conclude that the performance of the bank has been deteriorating with a negative effect on nearly all the elements, but the bank has recovered well over the last year where it improved its performance from -29.45% ROE to -2.82% which can be seen as a result of reduction in its leverage. Sales have been adversely affected in the recent year which is evident from the low asset turnover ratio which has reduced over the years. For Lloyds bank the ROE has gone down to nearly 5% for last 2 years from nearly 25% for the period of 2006- 2007. The major difference in the ROE can be seen at tax burden and interest burden. Interest burden drastically decreased showing earning before tax is a little fraction of earnings before interest and tax. This is because EBIT was small which made interest expense a large portion of EBIT therefore reducing EBT drastically. The other factor, Tax burden drastically increased showing that Net income was a large portion of EBT. This is because due to low profit there was no tax charges rather there was a tax rebate which made Net income more than earning before tax for some years. To support our claim we present the five years breakdown of the ROE for the two banks in the following tables- 2009 2008 2007 2006 2005 ROE 5.77% 5.08% 26.47% 24.35% 24.45% Tax burden 271.3% 101.57% 82.22% 65.98% 65.26% Interest burden 5.52% 5.87% 37.69% 38.78% 38.91% EBIT margin 42.88% 63.34% 48.21% 52.83% 53.63% Asset turnover .042 0.046 0.062 0.060 0.059 Leverage 20.96 28.69 28.43 29.85 30.38 LLOYDS ROYAL BANK OF SCOTLAND 2009 2008 2007 2006 2005 ROE 5.77% 5.08% 26.47% 24.35% 24.45% Tax burden 271.3% 101.57% 82.22% 65.98% 65.26% Interest burden 5.52% 5.87% 37.69% 38.78% 38.91% EBIT margin 42.88% 63.34% 48.21% 52.83% 53.63% Asset turnover .042 0.046 0.062 0.060 0.059 Leverage 20.96 28.69 28.43 29.85 30.38 Conclusion- Overall Lloyds bank managed their resource which is why it managed to keep its ROE positive and way above RBS over the last 5 years. So based on DuPont time series and cross section analysis Lloyds bank is the winner. Limitations- As we based our analysis on ratios, there are some limitations inherent to ratio analysis which is the limitations of our performance analysis. They are- -Banks may use alternative accounting methods which will have an effect on their ratios. -Ratio analysis is based on the person judging it. -This analysis may be misleading if the accounts are wind dressed. -It only takes into account the quantitative characteristics and ignores the qualitative point of view.

Nursing Management Plan For Nursing - 1533 Words

Assignment 1 Nursing care plans are structured nursing processes that identifyf patients â€Å"needs, goals, and progress, and identify current nursing interventions† (Caple, 2016, p. 1). Identification promotes communication with other health professionals providing care to the patient (Caple, 2016, p. 2). Care adapted holistically will meet the patients unique needs promotes positive outcomes (Caple, 2016, p. 1). This assignment introduces Mrs Adams (pseudonym) and briefly discusses her nursing management plan on day nine of admission. Her management plan developed by the nurse included input from a range of health professionals, friends and family. One important aspect of Mrs Adams nursing management plan explored in depth is oral cavity†¦show more content†¦Mrs Adams was monitored four hourly for changes in vital signs. The nurses believe this is appropriate for Mrs Adams clinical state as she is currently stable but at moderate risk of adverse events that could be detected b y abnormal vital signs. The nurse records observations on the Adult Deterioration Detection system (ADDS) (XDHB, 2017), and calculated a score of zero. Included on the ADDS chart is a numeric rating scale that measures pain intensity (Douglas, Schoenwald, 2013, p. 1334). Mrs Adams verbalises systemic pain as a seven out of ten at rest and a nine out of ten on movement. The nurse administered regular analgesia as prescribed and morphine subcutaneously through a dedicated morphine line located on the right deltoid half an hour before personal cares involving movement. No phlebitis was detected. Other prescribed medicine was administered through Mrs Adams nasogastric tube (NGT). This tube was flushed before and after medication and four hourly as per hospital policy to maintain the tubes patency (X District Health Board, 2015, p. 5). The flushes and NGT feeds were recorded on a fluid balance chart similar to Wottons (2013, p. 1215). Urine output from Mrs Adams indwelling catheter (I DC) was also recorded on this chart. Faecal output ranging from type six to seven was recorded on a Bristol’s bowel chart (Watt, 2013, p.1126). Personal cares such as wrap changes, positioning and bed washes are a two person assist asShow MoreRelatedNursing Management Plan791 Words   |  4 PagesThe goal of this innovation is to create a more inclusive and accessible access to web-based functions. The plan is to provide internal workers and external customers stress-free access to web-based functions whether, they be work related function or easing access to provider and service products. The project’s purpose is to disseminate computer-based instructional modules for browser access to medical, dental and provider catalog, with eased access to their tele-health, and pharmaceutical servicesRead MoreA Nursing Plan for Pain Management627 Words   |  2 Pagesï » ¿Nursing Plan The overall depth and breadth of interventions are hampered by two major things. First the patient is unwilling or unable to assist in their own care and the family (the daughter) is apparently not realizing that the patient is clearly on the verge of death for a number of reasons (hence the suggestion of hospice). Even if the daughter refuses to go that route, the focus remains on reducing pain as much as possible more than the patient getting better as this is clearly beyond theRead MoreNursing Problem, Management And Discharge Plans Essay914 Words   |  4 Pagesvisit them. Recently she was found on the floor by her grandson and after reaching hospital it was found that she suffered moderate to severe Ischaemic stroke (thrombotic) measured by NIHSS tool. Her primary admission diagnosis, nursing problem, management and discharge plans are further discussed in this case report. PRIMARY ADMISSION DIAGNOSIS: Her main reason for admission was that she suffered from Moderate to severe Ischemic stroke (thrombotic). Ischemic stroke occurs when the brain does notRead MoreSample Resume : Self Care1184 Words   |  5 PagesSelf-care in Nursing School Tris Bacani Denver School of Nursing Self-care in Nursing School Self-care is taking a strategic measure to ensure that one is safe and stays in focus. They are personal decisions that one takes for to improve their health. In this case, my self-care is to ensure that I remain in line with the nursing school and nursing career in general, and set strategies to implement the key options that I have chosen. These include time management, , focusing more in nursing schoolRead MorePersonal Statement On Health Assessment Essay1064 Words   |  5 Pagesconcepts are as follows: Communication in Health Assessment (Module1), Management planning in Nursing Process (Module 3), leadership and leadership style, Data collection in health assessment , nutritional assessment, vital signs, Depression and its assessment, substance abuse assessment and lastly assessing skin diseases: Skin cancer. 1. Communication in health assessment According to Wikipedia, Health Assessment is a plan of care that identifies the specific needs of a person and how thoseRead MoreBecoming A Nurse Practitioner Program1253 Words   |  6 PagesIt was a great challenge and sacrifice to return to school to acquire my Master Degree in Nursing with specialization in Nursing Informatics. During this MSN program, I coped between working full time, raising my son and daughter, taking care of my sick and aging parents but yet I managed to participate in discussions and submission of my assignments. The journey became though at some point that I had to take a three months break and decided not to return. Thanks to my educational adviser who wasRead MoreTime Management Is An Important Aspect Of Every Individual s Life909 Words   |  4 PagesTime Management Time management is an important aspect of every individual’s life as everyone should prioritize their responsibilities, and ensure that there is the appropriate amount of time for everything. In fact, time is the regulator of almost all activities and it is something you always lose but can never get back. Many individuals wish that they had more time or could re-live certain moments and use their time wisely. However, in the healthcare profession every second is essential and itRead MoreSample Resume : Self Care1176 Words   |  5 PagesSelf-care in Nursing School Tris Bacani Denver School of Nursing Self-care in Nursing School Self-care is taking a strategic measure to ensure that one is safe and stays in focus. They are personal decisions that one takes for to improve their health. In this case, my self-care is to ensure that I remain in line with the nursing school and nursing career in general, and set strategies to implement the key options that I have chosen. These include time management, exercising, and working fewerRead MoreNursing Research Utilization Project1349 Words   |  5 PagesNursing Research Utilization Project: The nursing profession has experienced several challenges and emerging issues in the recent past that have significant impacts on the health and wellbeing of the society. Some of the major challenges facing this field include nurses commitment to their work, their etiquette while working, shortage of nurses, meeting patients expectations, and their dedication to their profession and patients. While there have been numerous attempts to address these issuesRead MoreHealthcare Smart Goals1309 Words   |  5 PagesHealthcare SMART Goals Name Instructors Name Course Code SMART Goals The first goal is to promote professional development through mentoring programs for career development, professional growth, increase of morale, and quality within my nursing career by the end of one year. The second goal is to apply the principles of effective organization involving use of information, focus on patient care giving, and design clinical care giving in an organizational chart to achieve organizational

Pride and Prejudice Jane Austen Free Essays

Independent Reading A Guide to Pride and Prejudice Jane Austen â€Å"Follies and nonsense, whims and inconsistencies do divert me, I own, and I laugh at them whenever I can. † Special Considerations Copyright Holt, Rinehart and Winston. All rights reserved. We will write a custom essay sample on Pride and Prejudice Jane Austen or any similar topic only for you Order Now The Novel at a Glance Pride and Prejudice (1813) is a comedy of manners that explores how considerations of money, family background, and personal vanity can complicate the course of true love. Setting: Mostly in rural Hertfordshire in England in the late eighteenth century. Protagonist: Elizabeth Bennet, the most intelligent and complex daughter in a family of five unmarried isters who have no prospect of inheriting wealth. Structure: The novel is divided into three each subdivided into many short chapters. The plot involves pairs of lovers who seem destined never to get together because of the opposition of powerful blocking fgures and forces. The couples, however, after bringing the entire community together, are happily married in the end. Conflicts: The plot is propelled by the need of the female characters to find suitable husbands. The main conflicts are the obstacles or blocks that get in the way of achieving these marriages. The obstacles are both external (the want of beauty, money, sense, r social connections) and internal (an inability to discern the true character or feelings of another). Resolution: By learning from her experience and honestly evaluating herself, Elizabeth gains a husband who is not only wealthy but truly worthy. She overcomes her prejudice against Fitzwilliam Darcy, which was based on his appearance of pride, and he overcomes his prejudice against her family, which was based on pride in his own social rank and good manners. Themes: Knowledge comes through caretul reasoning and considered experience, unclouded by pride or prejudice based on rank or mere appearances. Of Special Note: By means of comic irony and satirical exaggeration, Austen exposes the social and moral follies of her society. The vocabulary of Pride and Prejudice should pose no major problems to upper-grade-level students reading at grade level, but all students, especially those reading below grade level, should be prepared to encounter a society whose social and economic conditions are markedly different from those of today. They can learn a great deal about Austen’s world from the novel itself, but some understanding of the British system of inherited wealth and the position of omen within that system during the early nineteenth century will help orient them. Background Entailed Property. In the traditional British class system, wealth was passed on via the inheritance of family property, an annual income for life, or both. Inherited wealth conferred far more status than money earned by work. Family estates were usually inherited by the oldest son; and other sons, and sometimes daughters, were given smaller incomes. An entail is a restriction on the inheritance of family property, and in the case of the Bennets, the entail stipulated that Longbourn, the family home, be passed on to a male cousin. The Eighteenth-century Gentlewoman. The Bennet sisters were considered gentlewomen because their father had inherited some wealth and therefore did not have to work to earn money. Because of the entail, however, they would not inherit any wealth of their own, unlike Georgiana Darcy and Caroline Bingley, whose fathers’ estates were so large that all the children were designated to inherit. Since it was not respectable or generally even feasible for gentlewomen to work, the Bennet sisters had no option but to find husbands who could support them and maintain their position in the class to which they were born. If they did not marry, hey would have to depend on the generosity of male relatives. Jane Austen’s own situation was typical of the time: she remained with her father until he died and then moved to her brother’s house. What was not typical was that she wrote books and was paid for her work. Pride and Prejudice 1 Mrs. Bennet, a frivolous woman, bent on making advantageous matches for her five daughters but lacking the ability to Judge the worth of their prospective suitors. She makes silly comments, otten at inappropriate times. Mr. Bennet, an intelligent but usually aloof man who looks on his wife and the marital dilemmas of his daughters with detached amusement. Notable for witty comments. Jane Bennet, the eldest daughter (in her early twenties), very beautiful and sweet- tempered, always ready to think well of others and modestly of herself†the friend and foil of her sister Elizabeth. Elizabeth Bennet, at first too quick and confident in her Judgments, she refines her knowledge of herself and her ability to evaluate others. More outspoken and opinionated than her sister Jane. Mary, Catherine (Kitty), and Lydia Bennet, the three younger sisters, flat characters who change little in response to experience. Mary is a pedant with no real knowledge. Lydia’s high spirits are unrestrained by good ense. Charles Bingley, a good-looking, wealthy, and agreeable young man, who falls in love with Jane but whose courtship of Jane is not encouraged by his friend Darcy or his fashionable sister Caroline, who wishes to marry Darcy. Functions as a foil for Darcy. Fitzwilliam Darcy, a handsome, dignified gentleman, heir to great property and wealth. A reserved man, ill at ease with strangers and mindful of social rank. He strikes the Bennets as cold and aloof. Falls in love with Elizabeth. Reverend William Collins, a clergyman and cousin of Mr. Bennet, who has ingratiated himself with the formidable Lady Catherine de Bourgh and stands to inherit Longbourn. He is accepted by Elizabeth’s plain, practical friend, Charlotte Lucas, after Elizabeth rejects his marriage proposals. How to cite Pride and Prejudice Jane Austen, Papers