Impact of current account and saving account on profitability of banking institutions

Abstract

CASA means current and saving account banking deposits are virtual vault of bank. It is providential that only financial institutions registered under the Banking Regulation Act, 1939 are eligible to offer such banking deposits. These banking deposits called as low-cost liabilities of bank. Because these types of deposits are motion 3-4% interest to the banking depositors rather than other banking deposits like recurring and fixed deposits. These deposits are exploited for loan and advances by bank, bank is charging these facilities. This study is done to consider how much CASA deposits have grown over time and how it helps banks to increase their profitability. This study based on 5“years CASA deposit growth of SBI bank was taken for analysis. By the use of correlation technique, the relationship between CASA growth and profitability, CASA Deposit growth and operating profit growth were found out”.