Cooperative bank
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Cooperative bank

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Cooperative bank Cooperative bank Presentation Transcript

  • NPAs of co operative bank  Presented by Hardeep sharma  Roll no. 120425717  MBA- 3rd semester
  • Introduction:  NPAs are loans made by a bank or a finance company on which repayments or interest payments are not being made on time. This study focuses on the problem of NPA, its reasons, effects.
  • PROFILE OF THE ORGANISATION  The Punjab State Cooperative Bank was established on 31st August, 1949 at Shimla vide registration No. 720 has a principle financing institution of the cooperative movement in Punjab.  In 1951 its Head Office was shifted to Jalandhar from where it moved in 1963 to its present building at Chandigarh. In the cooperative Banking structure, the position of the Punjab State Cooperative Bank is extremely important as the whole credit system revolves around it.
  • Organizational Structure
  • Types of co-operative banks Co-operative banks Rural co-op. banks Short term co-op. banks Long term co-op. banks Urban co-op. banks
  • Rural co- operative banks Short term co- op. banks State co- op. banks Central co- op. banks Primary agricultur e credit societies Long term co- op. banks State co-op. agriculture and rural development banks Primary co- op. agriculture and rural development banks
  •  OBJECTIVE S OF THE BANK  To protect the rural section from greedy money lenders  To provide easy credit facilities to the farmers  To promote and develop cooperative societies in the state  To provide training and education facilities to farmers  Overall development of rural areas
  • Review of literature  Books:  MY Khan, Financial Services  LM Bhole, Indian Financial System
  • Objectives of study  To understand what is NPA.  To understand what are the reasons for the emergence of the NPAs.  To understand the dimensions of NPA.  To study the position of NPA in co-op. bank.  To study the tools used for management of NPAs.  To evaluate the ratio of the bank with concerned to the NPAs.
  • Research methodology  Research design : Exploratory research design  Source of data:  Secondary data : annual reports of the bank Internet , financial books and agricultural book.
  • Limitations of study  Error is possible.  Unable to get current data.
  • Classifications of Assets Assets Performing asset or standard asset Non- performing assets Sub-standard assets Doubtful assets Loss assets
  • Non-performing assets NPA is a loan made by a bank or a finance company on which repayments or interest payments are not being made on time.
  • Types of NPA  Gross NPA  Net NPA
  • Reasons of NPA  Unwillingness of customers  Ineffective recovery system  Natural calamities  Inflation  Problems in agriculture sector  Ineffective government policies  Inappropriate technology  Poor credit appraisal system  Inefficient staff  Willful default is not a criminal offence.
  • Effects of NPA  Reduces profitability.  Reduces the image of the bank.  Blockage of funds.  Reduces chances of growth.
  • Management of NPAs  Early recognition of the problem.  Identifying borrowers with genuine intent.  Settlement with customers.  Lok adalats.
  • Data analysis and interpretations 0 10 20 30 40 50 60 70 80 90 100 standard assets sub-standard assets Doubtful assets loss assets 98.69 0.6 0.62 0.08 Year Wise NPA at Cooperative Bank for 2009-10
  • 0 10 20 30 40 50 60 70 80 90 100 standard assets sub-standard assets Doubtful assets loss assets 97.86 1.28 0.7 0.15 Year Wise NPA at Cooperative Bank for 2010-11
  • 0 20 40 60 80 100 stanadard assets sub-standard assets Doubtful assets loss assets 97.36 1.14 1.043 0.44 Year Wise NPA at Cooperative Bank for 2011-12
  • 2009-10 2010-11 2011-12 1.31 2.14 2.64 Gross NPA Ratio (%)
  • 2009-10 2010-11 2011-12 0.6 1.04 1.21 Net NPA Ratio (%)
  • Year wise-Inflation Rate Year • 2004 • 2005 • 2006 • 2007 • 2008 • 2009 • 2010 • 2011 • 2012 • 2013 Inflation rate (%) • 3.77 • 4.25 • 5.79 • 6.39 • 8.32 • 10.83 • 12.11 • 8.87 • 9.30 • 11.04
  • Findings  Gross NPAs are increasing every year. This is not good for bank.  Net NPA is increasing every year.  Standard assets are reducing every year.  Substandard asset ratio firstly increases then reduces.  Doubtful asset ratio is increasing every year.  Loss assets are increasing every year.  The position of the bank is not good with respect to its financial assets.  Increase in inflation is a main reason behind NPAs.
  • Suggestions  Financial capacity of the borrower should be evaluated.  Settlement procedure should be more strict and faster.  Innovative technology should be adopted.  Willful defaults should be made a criminal offence.  Proper training should be given to the staff.
  • Conclusion  Financial performance of the banks is not good due to the problem of NPAs. So this problem should be tackled as soon as possible. Otherwise our socio economic objectives cannot be achieved.
  • THANK YOU