Performance and asset quality of commercial banks in India a comparative analysis of public and private sector banks

Abstract

The present study introduces to the challenge of nonperforming assets being faced by the commercial banks in India. It defines a banking company and discusses different types of banks, explains the evolution of banking in India and provides the theoretical framework for the study and explains various concepts such as asset quality of banks, provisioning norms, types of NPAs, profitability of banks and various kinds of risk associated with the banking business. The study provides the most relevant literature, various empirical studies have been reviewed under the five sub--themes covering various aspects separately. The study also identified research gaps and framed the objectives in line with the theme of the present research. This research utilized secondary data sourced from the Reserve Bank of India (RBI) publications and Centre for Monitoring Indian Economy (CMIE) Analytics-- Prowess database for the period 2005 to 2017. Statistical packages, SPSS and EViews were used to analyse the data and to generate inferences. The study examined the nonperforming assets (NPAs) of the Public sector and Private sector banks in India and explored and identified various determinants of bad loans. newline