CASA ratio stands for current and savings account ratio. CASA ratio of a bank is the ratio of deposits in current, and saving accounts to total deposits. A higher CASA ratio indicates a lower cost of funds, because banks do not usually give any interests on current account deposits and the interest on saving accounts is usually very low 3–4%.[1] If a large part of a bank's deposits comes from these funds, it means that the bank is getting those funds at a relative lower cost. It is generally understood that a higher CASA ratio leads to higher net interest margin. In India, it is used as one of the metrics to assess the profitability of a bank.[2][3]
Formula
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CASA ratio of some Indian banks
edit| Bank | CASA Ratio | Date |
|---|---|---|
| SBI | 43.81% | 2017 [4] |
| Yes Bank | 26% | 2020 [5] |
| Kotak Mahindra Bank | 51% | March 2018[6] |
| ICICI Bank | 51% | January 2019 |
| Karnataka Bank | 28.91% | March 2020 |
| IndusInd Bank | 42.00% | March 2021[7] |
See also
editReferences
edit- ^ R. Narayanaswamy (2 April 2014). Financial Accounting: A Managerial Perspective. PHI Learning. p. 589. ISBN 978-81-203-4949-0. Retrieved 8 May 2015.
- ^ "What is CASA ratio?". The Economic Times. 10 May 2009. Retrieved 8 May 2015.
- ^ "Banks' CASA deposits grow 33%: What it means". Yahoo. 28 November 2013. Retrieved 8 May 2015.
- ^ "SBI Closed 41 Lakh Savings Bank Accounts Between April And January". NDTV. March 21, 2018. Retrieved Feb 2, 2020.
- ^ "Yes Bank-Annual-Report 2018". Yes Bank. April 30, 2018. Archived from the original on September 29, 2018. Retrieved May 7, 2018.
- ^ "Kotak Mahindra Bank - Q4FY18 Results" (PDF). Kotak Mahindra Bank. April 30, 2018. Retrieved May 7, 2018.
- ^ "IndusInd Bank Q4 net rises 25%". The Hindu Business Line. 16 April 2015. Retrieved 8 May 2015.
Further reading
edit- "What is CASA ratio?". The Economic Times. 10 May 2009.
- "De-jargoned: CASA". Live Mint. 6 February 2013.
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