Most investors look at profit growth and stop there. Here's what I track when analyzing banks: 1. NIM (Net Interest Margin) The core spread between what a bank earns on loans and pays on deposits. Compare quarter-on-quarter, not just YoY — margin compression can hide in a good headline number. 2. CASA Ratio Low-cost current and savings deposits vs total deposits. Higher CASA = cheaper cost of funds = better margin cushion when rates move. 3. Gross & Net NPA Asset quality is the real risk indicator. Watch the trend over 4-6 quarters, not one print. A single quarter can be noisy; a trend tells the real story. 4. Provision Coverage Ratio (PCR) How much of bad loans are already provided for. Higher PCR = fewer surprises ahead if slippages rise. 5. Credit-to-Deposit Ratio Shows how aggressively a bank is lending relative to its deposit base. Too high, and liquidity risk builds. 6. CRAR (Capital Adequacy Ratio) The buffer against future shocks. Below regulatory comfort levels can mean upcoming capital raises — and dilution. 7. Credit Cost Provisions as a % of advances. Rising credit cost even with stable NPAs can flag stress building beneath the surface. None of these work in isolation — it's the combination and the trend that tells you whether a bank's earnings quality is improving or deteriorating.

#Miscellaneous

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