Abstract:

This research set out to review the financial performance of ZANACO bank from the year 2013 to 2015 using financial ratios. Three (3) ratios were adopted to establish its financial soundness namely; the profitability, solvency and liquidity ratio. The liquidity ratios used were the cash ratio, quick ratio and the current ratio. The results from these ratios showed the bank was quite liquid and was able to convert its assets to cash easily as the ratios were above one (1) except the cash ratio. The profitability ratios used included the return on asset, return on equity and the net profit margin. It was discovered that though the ratios were not constant an average ratio of them showed the bank is making profits from its services. The last but not the least ratio done was the solvency ratio. The solvency ratios used included the debt to asset, debt to capital and the debt to equity ratios. The ratios were in favour of the banking meeting its long-term obligations except the debt to equity. All in all, all ratios suggested the bank was financially sound during the period 2013 to 2015.

Keywords: Financial Ratios, Financial Statements, Financial Ratio Analysis.

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