Maths Banking Easy ppt

This presentation is about banking. This ppt was made by Bhumik Aggarwal, Bhai parmanand vidya mandir, IX-F.

1. banking Presentation by Group 2

2. TOPICS COVERED IN THIS PRESENTATION Introduction Ba Banking Interest on loans Cash Flow Analysis of Financial Statements

3. Introduction As we all know in banking, mathematics is commonly used from a cashier to the manager of a bank. Bank is a vital unit of life. It is a place where everyone tries to keep their important belongings such as jewels and money safe. Bank is also used to lend loan to people, let's study more about it in further slides

4. What is banking? Banking is the business of protecting money for others. Banks lend this money, generating interest that creates profits for the bank and its customers. A bank is a financial institution licensed to accept deposits and make loans. But they may also perform other financial services.A bank's most important role may be matching up creditors and borrowers, but banks are also essential to the domestic and international payments system—and they create money.

5. Interest on loans A bank loan is when a bank offers to lend money to consumers for a certain time period . As a condition of the bank loan, the borrower will need to pay a certain amount of interest per month, or per year. The additional money that has to be returned with the amount is called the Interest.

6. Simple interest Simple Interest (S.I.) is the method of calculating the interest amount for a particular principal amount of money at some rate of interest . . The principal amount remains constant in simple interest. Simple interest is a straightforward and easy technique for calculating interest in money.

7. Compound Interest Compound interest is when you earn interest on both the money you've saved and the interest you earn. So let’s say you invest $1,000 (your principal) for 2 years and at the rate of 5% per annum. After the first year, you would have $1,050 – your original principal, plus 5 percent or $50. The second year, you would have $1,102.50. That’s because the next interest payment equals 5 percent of $1,050, or $52.5

8. Cash Flow Cash flow is a measure of how much cash a business brought in or spent in total over a period of time. Cash Flow (CF) is the increase or decrease in the amount of money a business, institution, or individual has. In finance, the term is used to describe the amount of cash (currency) that is generated or consumed in a given time period. There are many types of CF, with various important uses for running a business and performing financial analysis It is basically the debit and Credit of cash. It records the credit and debit of cash .Mathematics is used for calculating the money credited and debited .

9. Analysis of financial statements Financial statement analysis (or just financial analysis) is the process of reviewing and analyzing a company's financial statements to make better economic decisions to earn income in future.Various ratios have to be calculated by bank to analyse the market position of a company before giving loans . Maths is required for calculating the ratios.

10. How graphs are used in banking A bar chart or a pie chart is used to show the information in a way that is easy to understand. Bar charts compare categories, and pie charts show parts of a whole. Purpose: To analyze the impact of NPLs on listed commercial bank's profitability, in particular their ROA (Return on Assets).

11. Quiz time Q1. Find CI on ₹12600 for 2 years at 10% per annum compounded annually. Answer = ₹ 2646

12. Q2. If Manohar pays an interest of ₹750 for 2 years on a sum of ₹4,500, find the rate of interest. Quiz time Answer = 8.33333333333% or 25/3%

13. Q3. Find the interest to be paid for ₹500 for 4 years at 8% per annum. Also find the amount to be paid at end of the period. Quiz time Answer = ₹160 , ₹660

14. Thank You