Section A: Range of servicesBarclays Bank
Barclays Bank offers the following services; Current accounts, savings account, mortgages, property insurance, health insurance, credit cards and internet banking (Barclays Bank, 2012). However, the bank does not offer consumer banking, corporate banking, wealth management, investment banking, international banking, and personal banking.
TSB=Lloyds Bank
TSB Bank offers the following range of services; current account, internet banking, savings account, credit card, loan and mortgage (Lloyds Bank, 2012). This bank fails to offer the following services; consumer banking, corporate banking, wealth management, investment banking, international banking, and personal banking.
HSBC Bank
This bank has the following services on offer; credit cards, consumer banking, corporate banking, investment banking, mortgage, private banking, wealth management and savings account (Wood & Watson, 2013). The bank comes short in the following services; health insurance, internet banking, current account, international banking and personal banking
RBS=Natwest Bank
The services offered by this bank range from current accounts, credit cards, mortgage, loan, saving, investment, property insurance to international and personal banking (RBS Bank, 2012). Services that are not offered are; consumer banking, corporate banking, wealth management and investment banking.
Similarities and differences in the range of services
All the four banks offer cash and check deposit services. The other services offered by all the four banks include; savings accounts loans and also mortgages. In addition, there are credit cards. The banks have several differences. The first is that Barclays is the only bank that offers health insurance. In addition, only Barclays and TSB are the only banks that offer internet banking. The only bank that does not offer current accounts is HSBC Bank. However, HSBC is the only bank that offers consumer banking, corporate banking, investment banking and wealth management. RBS Bank is different from the others in that it offers international and personal banking.
Section B: Ratio analysisTrend analysis
Trend analysis
Trend analysis
HSBC Bank increased its gross profit, operating profit and net profit ratio between 2008 and 2010. These ratios increased in 2012 after decreasing in 2011. The return on capital employed increased between 2008 and 2010. It decreased in 2011 and increased in 2012. The return on equity fell between 2008 and 2011. It increased in 2012. The return on total assets decreased in 2009 and remained constant up to 2010. It fell in 2011 and increased in 2012. The contribution margin increased in 2009 and decreased in 2010 and 2011. It increased in 2012. The return on investment followed a similar pattern with the contribution margin.
Trend analysis
The gross profit, operating profit, net profit, return on capital and contribution margin ratios increased between 2008 and 2012. The return on equity decreased in 2009 and increased in 2010 and 2011. This ratio decreased in 2012. The return on total assets and return on investment between 2008 and 2010. These two ratios decreased in 2011 and increased in 2012.
Graph of gross profit for the four banks
Individual bank performance
The gross profit ratio has been selected since it is indicative of the overall performance (Greenfield, 2010). Barclays improved its performance between 2008 and 2010. In 2011, its performance declined, but it was above the 2009 level. In 2012, the performance of this bank was at its peak. TSB Bank recorded an increasing performance between 2008 and 2012. HSBC Bank recorded a gross profit ratio decrease in 2009. The figure increased in 2010 but, not to the 2009 level. In 2011, the bank recorded the lowest value in comparison to the other years. In 2012, the performance of the bank was at its peak. RBS Bank recorded an improved performance between 2008 and 2009. Each year turned out better in performance than the previous.
Competitor analysis and basis of performance
Based on the graph, HSBC is the top performer in each of the years. The second top performing bank is Barclays. The third best performer is TSB Bank while the last performer is RBS Bank. The reasons for this performance are based on the service range. HSBC Bank offers a wide service range comprising of consumer, corporate, investment banking and wealth management. This has differentiated it in the financial services market, hence the competitive edge and an impressive performance. Barclays comes in second due to its health insurance business. As the only provider of this service, Barclays profits from this positioning. TSB Bank beats RBS Bank due to its internet banking services. This service has been phenomenal due to internet growth. This factor is responsible for the performance of TSB Bank. RBS is the last owing to lack of this service.
Section C: Factors responsible for performance
The performance of these banks is attributable to the economic performance in the UK. Performance has been on an increase between 2008 and 2010 due to GDP growth in the UK. The cumulative annual growth rate in this period averaged 4.78% (Cole, 2012). In 2011, consumer confidence decreased, and hence the decrease in performance. In 2012, performance was hindered by high unemployment levels in the UK. The bank specific factors are based on service offers. A wide and profitable service range was responsible for the high performance. Growth in GDP was brought about by growth in the transport and telecommunication sector of the UK (Cole, 2012).
References
Barclays Bank. (2012, December 17). Products and Services . Retrieved from http://group.barclays.com/about-barclays/investor-relations/annual-reports: http://group.barclays.com
Cole, T. (2012). Economic Overview of the UK. Journal of Finance, 128.
Greenfield, S. (2010). Profitability Ratios. Ratio Analysis, 36.
Lloyds Bank. (2012, December 30). Our Banking Options. Retrieved from http://www.lloydsbankinggroup.com/investors/financial_performance/company_results_ltsb.asp: http://www.lloydsbankinggroup.com
RBS Bank. (2012, December 14). RBS Banking Products. Retrieved from http://www.investors.rbs.com/report_subsidiary_results: http://www.investors.rbs.com
Wood, P., & Watson, A. (2013, January 9). Our Business Banking Services. Retrieved from http://www.hsbc.co.uk/1/2/about-us/reports-and-accounts/financial-reports#Annual_Report_and_Accounts_2012: http://www.hsbc.co.uk
