27-09-2013, 04:36 PM
ASSIGNMENT FOR INTERNAL EVALUATION
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1. From the NSE website http://www.nseindia.com collect data on the five bonds issued by Aditya Birla Finance. The information to be collected is
1) Face Value
2) Coupon Rate
3) Term to Maturity
4) Maturity Amounts
5) Frequency of Coupon Payments
a. Based on the above data, calculate the YTM at the time of issue for all the bonds issued by Aditya Birla Finance
b. What will be the % change in the price of the bonds, if the YTM of these bonds decreases by 1.5% (subtract 1.5% from the price of the bonds).
Submit the collected data along with the calculations to support your answer.
2. Collect the following data related to Indian Rupee (INR) and US Dollar ($) as on January 2, 2013:
a) Spot $/INR bid-ask spread
b) 3-months Future $/INR bid-ask spread
c) The 91-day Indian Treasury bill rate
d) The 91-day US Treasury bill rate
Similarly, collect data related to the Indian Rupee (INR) and Great Britain Pound (£)
e) Spot £/INR bid-ask spread
f) 3-months Future £/INR bid-ask spread
g) The 91-day Indian Treasury bill rate
h) The 91-day UK Treasury bill rate
a. Using the Fisher’s Interest rate parity equation calculate the expected 3-month Future $/INR and £/INR bid-ask spread and compare it with the actual 3-months Future $/INR and £/INR bid-ask spread.
b. In case they do not match specify the reasons why the interest rates do not match.
c. If the expected and actual rates do not match, what position would an arbitrageur take, in each case?
3. Based on the balance sheet of ICICI Bank and your branch performance sheet for the quarter ended March 2012, you are required to:
a. Calculate the cost to income ratio of the bank and your branch (or any branch of your bank) for the quarter ended March 2012. Analyse the branch performance vis-à-vis the bank performance. Suggest atleast two measures for improving the cost to income ratio of your branch.
b. Compare the CASA ratio at your branch (any other branch if you are not currently working at a branch) with the CASA ratio of the Bank for the quarter ended March 2012. Assess the current strategies and suggest atleast two measures to improve the CASA ratio.
c. Calculate the net interest income and fee income of the bank and compare the same with the net interest income and fee income at the branch. Analyse the causes for variances if any, and suggest two workable measures to reach the fee and net interest income targets.
d. If the branch achieves the branch fee income and the CASA target what would be the impact on the net interest income and fee income. Suggest atleast two innovative measures to improve fee income.