Abstract:
The Banking Industry provides a substantial contribution to the Sri
Lankan economy. This research aims to compare the forecast
performance indicators of the Commercial Bank of Ceylon PLC with the
Banking industry. The researcher has selected the Commercial Bank of
Ceylon PLC as a sample since it is ranked 1st in the Banking Sector on
Colombo Stock Exchange and the only Sri Lankan bank to be ranked for
the 10th consecutive year by "The Banker". In this study, the researcher
has used statistical software named R to analyze the data considering
Profitability, Liquidity, and Capital Adequacy indicators. Data has been
gathered over ten years from 2009 to 2018, and the predictions were
made adopting Ohlson's Forecasting Model for the subsequent years
2019 and 2020. The Commercial Bank PLC is on track with the industry
norms except in areas, especially Net Interest Margin, Liquidity, and
Core Capital Ratio, where significant improvements are needed to bring
their performance on track, the findings reveal. The Ohlson model's
robustness was tested using Mean Absolute Percentage Error (MAPE). It confirms that the model best fits the two variables used in the study named Core Capital Ratio and Total Capital Ratio.
