Page 16 - FIN435 RHB vs BPMB

Interest Spread Ratio

Interest Spread Graph

3.50%
3.05%
3.00% 2.76%
2.50% 2.22%
2.00%

1.50%

1.00%
0.50%

0.00%
Category 1
2018 2017 2016

The net interest rate spread is the difference between the average yield that a financial
institution receives from loans along with other interest.. The net interest spread ratio for 3
years trend from 2016 to 2018 indicate downward trend from 2.4% in 2016 to 2.1% in 2017
and to 2% in 2018. This evidence and data lead to decrease in profitability of the company.

2. Liquidity Ratio = Loan To Asset Ratio
Loan To Asset Ratio Graph

80.00% 78.97%

78.00%

76.00%
73.93%
74.00% 73.13%
72.00%

70.00%
Category 1

2018 2017 2016

Loan On Asset Ratio (LOA) is the ratio used to demonstrate the ability of banks to meet the
demand for loans by using the total assets owned by banks.. Based on trend analysis from
2016 to 2018, the trend decreased from 78.97% in 2016 to 73.13% in 2017, and show
upward trend to 73.93% in 2018. The bank record a high (LOA) for this 3 years that more
than 50 % of it total asset that may lead to liquidity risk. High liquidity risk may lead to low of
liquidity such as not having sufficient of cash and borrowing capacity to loan demand.

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