The Financial Statement Analysis of Commercial Banks in Bahrain: A case study of Ahli United Bank

Abstract

Financial sector of kingdom of Bahrain intensely supports the growth of the economy. It contributed 27% of Bahrain GDP in 2018.The wellbeing of an economy can be examined by financial performance of the bank. Financial performance is the result of its policies and operations in monetary terms. The aim of the study is to examine the financial performance of the banks in Kingdom of Bahrain- A Case study approach. For the evaluation of the performance of bank, secondary data was collected from the annual audited report of the bank for the period of 2011 to 2017. It focuses on two important indicators the profitability and liquidity. As the shareholders are in need to maximize their return on investment and the depositors need to get back their savings according to their needs focuses on liquidity. To measure the profitability, return on asset and return on equity is the variable and loan to deposit and loan to asset to evaluate the liquidity. For this ratio analysis is being used to measure as it is evident from the previous studies. The study used percentage analysis, descriptive statistics and correlation the result of the analysis portrayed that return on asset and return on equity are positively correlated and negatively correlated with loan to asset.