Why Banks Are Different From Every Other Business | Peeyush Chitlangia

📈 Register for Offline Training Program on Fundamental Analysis with Peeyush Chitlangia: https://forms.gle/64t6V7jLvvCg4Hix9 In this video, I explain how a bank actually works and what investors should look at when analysing a banking business. We start with the basic structure of a bank, where deposits come in and are used for lending, and then look at why banking is different from most other businesses. The discussion also explains why banks are highly leveraged and why the interests of depositors, borrowers and shareholders need to be managed carefully. We then look at some of the key risks that can affect a bank, including liquidity risk, asset-liability mismatch, NPAs and capital adequacy. Using a simple example, I explain how a rise in bad loans can impact a bank’s equity and why banks need to maintain enough capital to continue lending and growing. The next part focuses on the key parameters investors should track while analysing banks. We discuss cost of deposits, CASA ratio, loan yield, risk management, NIM, access to capital, investment quality and cost-to-income ratio. The idea is not just to look at one number, but to understand how these parameters are moving over time and what they tell us about the quality of a bank’s business. Finally, we take ICICI Bank’s investor presentation and apply these concepts to a real bank. We look at the numbers and understand how investors can use investor presentations to track CASA, NIM, NPAs, provisions, ROA and ROE. If you want to understand the basics of banking and learn a practical framework to analyse banks before investing, this video is a good place to start. Follow me on socials: LinkedIn -   / peeyushchitlangia   X - https://x.com/peeyushc Timestamps: 00:00 Preview 01:13 Introduction 01:36 How a Bank Functions 11:00 What Can Go Wrong in a Banking System? 15:40 Key Parameters to Analyse a Bank 23:58 Analysing ICICI Bank's Investor Presentation 27:18 Conclusion