CREDIT QUALITY IN INDIAN BANKING :QUANTITATIVE EVALUATIONDinabandhu Bag
This document summarizes a study examining factors that influence credit quality and non-performing loans in Indian banking. The study finds:
1) Both economic factors and bank-specific factors like capital adequacy ratios and credit deposit ratios influence credit quality and non-performing assets.
2) Analyzing data from 2002-2007 for 17 major Indian banks, the study finds higher capital adequacy ratios and credit deposit ratios are associated with lower non-performing loans.
3) Stronger economic growth, as measured by GDP growth, is also associated with lower non-performing loans for banks. The results provide insights into how banks can maintain better credit quality.
Financial performance of select public sector banks in India: A Review of Sel...AJHSSR Journal
ABSTRACT :This study focuses on review papers that are published in prestigious journals and explores the
performance of public sector banks (PSBs) as a critical indicator of the nation's economic health. Delving into
intricate financial dynamics, it scrutinizes select PSBs, revealing insights into their fiscal resilience, adaptability
to market trends, and contribution to economic well-being. The research analyzes transformative changes in the
financial landscape, encompassing regulatory reforms and technological advancements. Examining key metrics
like profitability, asset quality, and credit expansion, the study provides a comprehensive overview of PSBs' role
in economic resilience. The methodology involves a review of 20 papers, identifying a research gap in
understanding the long-term impact of specific characteristics on profitability. The findings suggest a need for
holistic and longitudinal analyses to comprehend the evolving dynamics of public sector banks in response to
market changes and regulatory reforms, providing enduring insights into their financial health.
KEYWORDS: Public sector banks, financial performance, Economic resilience, Regulatory reforms,
Technological advancements, Longitudinal analysis, Indian banking sector.
A Comparison of Key Determinants on Profitability of India’s Largest Public a...Rajveer Rawlin
The banking sector in India has come under the scanner following some key changes in monetary policy. With
the Reserve bank of India (RBI) raising interest rates to support the falling Indian currency the Rupee, the cost of
funds of banks has increased significantly. This could manifest itself in rising non-performing assets (NPAs) and
declining profitability. The profitability of banks is impacted by both internal and external factors. This paper is
an attempt to compare the key drivers of profits at India’s largest public and private sector banks. Bank specific
metrics and risk factors were important drivers of profits at both banks. Productivity measures were key drivers
of profits at India’s largest public sector bank SBI but had no effect on profits at India’s largest private sector
bank, HDFC bank. Asset usage efficiency measures were key determinants of profitability at HDFC bank but not
at SBI. The single most important determinant of SBI proved to be business per employee, a productivity
measure while advances and bank size which are traditional bank metrics were key drivers of profits at HDFC
bank. Managers at both banks and their share holders thus can look at these drivers to develop a broad
understanding of profitability at the two banks.
Financial sector plays a pivotal role in the economic development, but, in recent time, it has witnessed that the World Economy is passing through some intricate circumstances as bankruptcy of banking & financial institutions, debt crisis in major economies of the world and euro zone crisis. The scenario has become very uncertain causing recession in major economies like US and Europe. The tempo of development for the Indian banking industry has been remarkable over the past decade. It is evident from the higher pace of credit expansion, expanding profitability and productivity similar to banks in developed markets, lower incidence of non- performing assets and focus on financial inclusion have contributed to making Indian banking vibrant and strong. Indian banks have begun to revise their growth approach and re-evaluate the prospects on hand to keep the economy rolling. It is generally agreed that a strong and healthy banking system is a prerequisite for sustainable economic growth. The banking sector has always been one of the important sectors for investment. In the time of uncertainty, some are arguing that the economies are in the process of recovery, and while others are opining that the world is set for another recession soon. In order to resist negative shocks and maintain financial stability, it is important to identify the Performance of Indian Banking Sector. The current study is mainly concerned with the analysis of Performance Of banking sector in India, that reflects the impact of new competitive environment on the bank’s performance in terms of various selected parameters. The article considered the variables like balance sheet operations, efficiency, profitability ,Capital Adequacy, Asset Quality, Sect oral deployment of bank credit, Technological Development, Customer services and Financial Inclusion for a period of 6 years from 2011 to 16. The Data was collected through secondary sources from Statistical Tables relating to banks in India. The results have found strong evidence poor profitability and inefficiency of managing the assets in the year 2016.
Stressed Assets Effect on Post Merger Scheduled Commercial Banks in Indiaijtsrd
This document discusses stressed assets and non-performing assets (NPAs) in Indian banks. It provides background on issues like rising NPAs, the Insolvency and Bankruptcy Code, and efforts by the Reserve Bank of India to resolve stressed assets. The Insolvency and Bankruptcy Code has helped improve recovery rates compared to previous mechanisms. While liquidations have been higher than resolutions so far under IBC, many of the cases involved were already non-viable. Overall, IBC represents a significant reform in debt resolution that can help reduce NPAs over time.
A research article that touches upon the everlasting issue of rising Non-Performing Assets ( Stressed Assets) in the Indian Banking Industry.
It explores macro economic concepts coupled with evolving legal regulations that may have just given passage to a lucrative debt market in India.
CREDIT QUALITY IN INDIAN BANKING :QUANTITATIVE EVALUATIONDinabandhu Bag
This document summarizes a study examining factors that influence credit quality and non-performing loans in Indian banking. The study finds:
1) Both economic factors and bank-specific factors like capital adequacy ratios and credit deposit ratios influence credit quality and non-performing assets.
2) Analyzing data from 2002-2007 for 17 major Indian banks, the study finds higher capital adequacy ratios and credit deposit ratios are associated with lower non-performing loans.
3) Stronger economic growth, as measured by GDP growth, is also associated with lower non-performing loans for banks. The results provide insights into how banks can maintain better credit quality.
Financial performance of select public sector banks in India: A Review of Sel...AJHSSR Journal
ABSTRACT :This study focuses on review papers that are published in prestigious journals and explores the
performance of public sector banks (PSBs) as a critical indicator of the nation's economic health. Delving into
intricate financial dynamics, it scrutinizes select PSBs, revealing insights into their fiscal resilience, adaptability
to market trends, and contribution to economic well-being. The research analyzes transformative changes in the
financial landscape, encompassing regulatory reforms and technological advancements. Examining key metrics
like profitability, asset quality, and credit expansion, the study provides a comprehensive overview of PSBs' role
in economic resilience. The methodology involves a review of 20 papers, identifying a research gap in
understanding the long-term impact of specific characteristics on profitability. The findings suggest a need for
holistic and longitudinal analyses to comprehend the evolving dynamics of public sector banks in response to
market changes and regulatory reforms, providing enduring insights into their financial health.
KEYWORDS: Public sector banks, financial performance, Economic resilience, Regulatory reforms,
Technological advancements, Longitudinal analysis, Indian banking sector.
A Comparison of Key Determinants on Profitability of India’s Largest Public a...Rajveer Rawlin
The banking sector in India has come under the scanner following some key changes in monetary policy. With
the Reserve bank of India (RBI) raising interest rates to support the falling Indian currency the Rupee, the cost of
funds of banks has increased significantly. This could manifest itself in rising non-performing assets (NPAs) and
declining profitability. The profitability of banks is impacted by both internal and external factors. This paper is
an attempt to compare the key drivers of profits at India’s largest public and private sector banks. Bank specific
metrics and risk factors were important drivers of profits at both banks. Productivity measures were key drivers
of profits at India’s largest public sector bank SBI but had no effect on profits at India’s largest private sector
bank, HDFC bank. Asset usage efficiency measures were key determinants of profitability at HDFC bank but not
at SBI. The single most important determinant of SBI proved to be business per employee, a productivity
measure while advances and bank size which are traditional bank metrics were key drivers of profits at HDFC
bank. Managers at both banks and their share holders thus can look at these drivers to develop a broad
understanding of profitability at the two banks.
Financial sector plays a pivotal role in the economic development, but, in recent time, it has witnessed that the World Economy is passing through some intricate circumstances as bankruptcy of banking & financial institutions, debt crisis in major economies of the world and euro zone crisis. The scenario has become very uncertain causing recession in major economies like US and Europe. The tempo of development for the Indian banking industry has been remarkable over the past decade. It is evident from the higher pace of credit expansion, expanding profitability and productivity similar to banks in developed markets, lower incidence of non- performing assets and focus on financial inclusion have contributed to making Indian banking vibrant and strong. Indian banks have begun to revise their growth approach and re-evaluate the prospects on hand to keep the economy rolling. It is generally agreed that a strong and healthy banking system is a prerequisite for sustainable economic growth. The banking sector has always been one of the important sectors for investment. In the time of uncertainty, some are arguing that the economies are in the process of recovery, and while others are opining that the world is set for another recession soon. In order to resist negative shocks and maintain financial stability, it is important to identify the Performance of Indian Banking Sector. The current study is mainly concerned with the analysis of Performance Of banking sector in India, that reflects the impact of new competitive environment on the bank’s performance in terms of various selected parameters. The article considered the variables like balance sheet operations, efficiency, profitability ,Capital Adequacy, Asset Quality, Sect oral deployment of bank credit, Technological Development, Customer services and Financial Inclusion for a period of 6 years from 2011 to 16. The Data was collected through secondary sources from Statistical Tables relating to banks in India. The results have found strong evidence poor profitability and inefficiency of managing the assets in the year 2016.
Stressed Assets Effect on Post Merger Scheduled Commercial Banks in Indiaijtsrd
This document discusses stressed assets and non-performing assets (NPAs) in Indian banks. It provides background on issues like rising NPAs, the Insolvency and Bankruptcy Code, and efforts by the Reserve Bank of India to resolve stressed assets. The Insolvency and Bankruptcy Code has helped improve recovery rates compared to previous mechanisms. While liquidations have been higher than resolutions so far under IBC, many of the cases involved were already non-viable. Overall, IBC represents a significant reform in debt resolution that can help reduce NPAs over time.
A research article that touches upon the everlasting issue of rising Non-Performing Assets ( Stressed Assets) in the Indian Banking Industry.
It explores macro economic concepts coupled with evolving legal regulations that may have just given passage to a lucrative debt market in India.
This document analyzes the financial performance of IDBI Bank from 2008-2013. Some key findings include:
- IDBI Bank's net worth increased 140.71% from Rs. 8,821.96 crores to Rs. 21,236.03 crores over this period.
- Borrowings increased 70.43% from Rs. 38,612.55 crores to Rs. 65,808.9 crores.
- Total assets grew 147.35% from Rs. 130,694.38 crores to Rs. 322,768.5 crores.
- Net profits increased 152.09% from Rs. 746.59 crores to Rs. 1882.
An Analysis on the Non Performing Assets of Public Sector Banks in Indiaijtsrd
The objective of this study is to analyse the impact of Priority Sector Lending PSL on Non Performing Assets NPAs of Public Sector Banks PSBs in India. Further, the study investigates the impact of NPAs of PSBs in India on Gross Advances GAs and Net Profitability. The paper also examines the presence of structural break in the relationship between GAs and NPAs of PSBs due to the Financial Crisis, 2007 08. The results show that PSL has a significant impact on NPAs of PSBs. There is a negative impact of NPAs on GAs and NP of PSBs. There is structural break in the relationship between GAs and NPAs due to financial crisis. Catherine Rachel Jacob | Alan Eapen Philip | Rajalakshmi E R "An Analysis on the Non-Performing Assets of Public Sector Banks in India" Published in International Journal of Trend in Scientific Research and Development (ijtsrd), ISSN: 2456-6470, Volume-6 | Issue-2 , February 2022, URL: https://www.ijtsrd.com/papers/ijtsrd49271.pdf Paper URL: https://www.ijtsrd.com/management/other/49271/an-analysis-on-the-nonperforming-assets-of-public-sector-banks-in-india/catherine-rachel-jacob
This document summarizes recent developments in the Indian banking sector. It discusses how total bank assets have grown substantially over the last decade to Rs 82,99,220 crore. It also notes that bank revenue and profits have increased significantly from 2001-2010. The growth has been driven by foreign investment and conservative RBI policies. Recent union budgets have proposed investments to capitalize banks and promote financial inclusion and agricultural lending. The banking sector is expected to continue growing in line with the strong projected growth of the Indian economy.
Mergers and Acquisitions in Indian Banking Sector A Case of Bharat Overseas B...ijtsrd
Mergers and Acquisitions MandAs continue to be a significant force in the restructuring of the financial services industry. The Indian Commercial Banking Sector, which has played a pivotal role in the country’s economic development, is currently passing through an exciting and challenging phase. The present research papers studies the impact of MandA on the financial performance of Bharat Overseas Bank and Indian Overseas Bank. The study uses key financial ratios to find the impact of MandA on financial performance of selected banks. Dr. Soniya Gambhir "Mergers and Acquisitions in Indian Banking Sector (A Case of Bharat Overseas Bank and Indian Overseas Bank)" Published in International Journal of Trend in Scientific Research and Development (ijtsrd), ISSN: 2456-6470, Volume-5 | Issue-2 , February 2021, URL: https://www.ijtsrd.com/papers/ijtsrd38415.pdf Paper Url: https://www.ijtsrd.com/management/accounting-and-finance/38415/mergers-and-acquisitions-in-indian-banking-sector-a-case-of-bharat-overseas-bank-and-indian-overseas-bank/dr-soniya-gambhir
What are the Stimulating Factors Affecting NPL in Banking Sector of Banglades...ijtsrd
A well organized, well structured and developed financial sector ensures efficient allocation of financial resources and perks up the competitiveness of the private sector, thereby promoting investment and growth in the real sector. The thrust of the development is to improve the regulatory and governance environment and to enhance the ability of bank owners, management and regulators, and the markets themselves to provide for better governance and regulation to achieve the objectives. In this perspective, improvement of the situation of non performing loan is important. A high volume of non performing loan can never be a boon for the economy. Credit to economy is the main source for financial support of business. On the other side, banks have limited investment tools for their deposits. This study present results from an econometric analysis, favorably Random Effect Model, using pooled panel data collected from the central bank of Bangladesh categorizing four sectors of banking based on the pattern of ownership. Based on the analysis of the bank specific microeconomic factors, which are selected on the availability from reliable sources, used as the regressors, it is observed that the liquidity and the management soundness is more significantly affect the Non performing loan NPL in Bangladesh. Therefore, the recommendation is placed towards formulation policy instruments in favor of solvency rather liquidity. In addition to that, the improvement of managerial efficiency must be sought as well. Ratna Biswas | Mohammed Nazrul Islam | Chanu Gopal Ghosh ""What are the Stimulating Factors Affecting NPL in Banking Sector of Bangladesh? Evidence from Econometric Exercises"" Published in International Journal of Trend in Scientific Research and Development (ijtsrd), ISSN: 2456-6470, Volume-4 | Issue-2 , February 2020, URL: https://www.ijtsrd.com/papers/ijtsrd29861.pdf
Paper Url : https://www.ijtsrd.com/economics/financial-economics/29861/what-are-the-stimulating-factors-affecting-npl-in-banking-sector-of-bangladesh-evidence-from-econometric-exercises/ratna-biswas
EFFECT OF NON-PERFORMING ASSETS (NPA) ON PERFORMANCE OF COMMERCIAL BANKS IN I...IAEME Publication
After the liberalization policy of 1991, Indian banking sector change dramatically and measure were taken for making Indian banking sector as a world standard. There are many obstacles faced by Indian banks and increasing NPA is one of them. There are two types of NPA – Gross NPA and Net NPA. For present study Net NPA are considered. Reserve Bank of India (RBI) is monitoring these phenomena and declaring guidelines at various times. After the slowdown of 2008, the threat of increasing NPA and decreasing ROA is witnessed. This paper is an attempt to correlate the NPA and ROA of Indian commercial Banks. Though the sample size is small but all major 11 banks (6 Public sector banks and 5 Private sector banks) where chosen for the study. 2015-16 to 2018-19 is the study period for this study.It is found that in this study period of 4 years, NPA increase rate is higher in public sector banks than the private sector banks. NPA of private sector banks are well under control. This study shows that there is moderate negative correlation of NPA and ROA of Public sector banks. This means as the NPA increasesit negatively affects the ROA of banks.
The document provides details on selecting a portfolio of 10 BSE Sensex companies with a total investment of Rs. 10,00,000 based on analysis to identify stocks that will provide the best returns over 1-2 years. It describes performing fundamental analysis on company financials and market conditions, technical analysis of stock trends, and sector analysis. A portfolio is presented with investments in 8 companies totaling Rs. 10,00,000 that was selected after analyzing each company and sector trends like banking, using factors like growth prospects, government policies, macroeconomic indicators, and global economic conditions.
This document contains details of a student project analyzing the financial statements of the top 3 Indian banks - SBI, ICICI, and PNB. It includes the student's name, roll number, project title, subject area, and guide's name. The project involves calculating and comparing various ratios such as profitability, leverage, payout, and liquidity ratios across the three banks. The objectives are to assess the banks' profitability, do comparative analysis between banks, and evaluate operational efficiency. The introduction provides background on banks' role in the economy. The literature review discusses previous research on analyzing banks' financial performance.
A study on the mediating effect of gdp on relationship between gross advances...Alexander Decker
1. The study investigates the role of GDP as a mediating variable between gross advances (loans issued) and non-performing assets (NPAs, or bad loans) of major Indian banks from 2000-2001 to 2011-2012.
2. It finds that GDP significantly interacts with the relationship between advances and NPAs, with this interaction effect differing before and after the 2007-2008 financial crisis.
3. The study aims to determine if GDP mediates the relationship differently for major bank groups in India, and whether this mediation was impacted by the financial crisis.
A Study on Factors Influencing the Financial Performance Analysis Selected Pr...Dr. Amarjeet Singh
The growth of a country's banking sector has a significant impact on its economic development. The banking sector plays a critical role in determining a country's economic future. A well-planned, structured, efficient, and viable banking system is an essential component of an economy's economic and social infrastructure. In modern society, a strong banking system is required because it meets the financial needs of the modern society. In a country's economy, the banking system plays a crucial role. Because it connects surplus and deficit economic agents, the bank is the most important financial intermediary in the economy. The banking system is regarded as the economy's lifeline. It meets the financial needs of commerce, industry, and agriculture. As a result, the country's development and the banking system are intertwined. They are critical in the mobilisation of savings and the distribution of credit to various sectors of the economy. India's private sector banks play a critical role in the country's economic development. So The financial performance of private sector banks must be evaluated carefully.
This document analyzes the performance of banks in India before and after the World Trade Organization's General Agreement on Trade in Services (GATS). It discusses how GATS led to increased competition in India's banking sector through allowing more foreign bank presence. The study develops a composite index to rank different bank groups (public sector, private sector, foreign) based on measures of productivity, profitability, and efficiency. It finds that while foreign and new private banks initially outperformed public sector banks, the traditional banks improved after GATS as they adapted to greater competition. The document provides context on banking reforms in India and reviews prior literature on comparing performance of different bank ownership groups.
This document analyzes the performance of banks in India before and after the World Trade Organization's General Agreement on Trade in Services (GATS). It discusses how GATS led to increased competition in India's banking sector through allowing more foreign bank presence. The study develops a composite index to rank different bank groups (public sector, private sector, foreign) based on measures of productivity, profitability, and efficiency. It finds that while foreign and new private banks initially outperformed public sector banks, the performance of traditional banks (public and old private) improved after GATS as they adapted to greater competition. The document provides context on banking reforms in India and reviews previous related studies.
This document provides a comparative study of the asset quality of IDBI Bank and State Bank of India from 2011-2016. It begins with background on asset quality and how non-performing assets (NPAs) impact banks' profitability and financial statements. The objectives are to compare the total advances, net profit, gross NPAs, and net NPAs of IDBI and SBI, as well as their asset quality ratios and loan classifications. Relevant literature on factors influencing bank asset quality and managing NPAs is reviewed. Brief profiles of IDBI and SBI are also given.
The document discusses the financial performance of commercial banks in India. It provides background on commercial banks and their role in India's financial system. It then reviews previous literature on assessing bank performance and financial ratios. The document also includes a table showing the consolidated balance sheet of public sector banks in India for 2019-20, with capital, reserves, deposits, loans and other line items. Overall, the document examines the financial performance of commercial banks through analyzing their income, expenditures and consolidated balance sheets.
FINANCIAL PERFORMANCE OF COMMERCIAL BANKS IN INDIA
Dr.C. PARAMASIVAN Assistant Professor
G.RAVICHANDIRAN Ph.D. Full Time Research Scholar
PG & Research Department of Commerce Periyar E.V.R.College (Autonomous), Tiruchirappalli620023. (Affiliated to Bharathidasan University, Tiruchirappalli, India)
Financial intermediation is a crucial function of Banks, Non-Banking financial companies (NBFCs) and Development Financial Institutions (DFIs) the post reform period in India is characterized by phenomenal growth of NBFCs complementing the role of banks in mobilizing funds and making it available for investment purposes. During the last decade NBFCs have undergone wide volatility and change as an industry and have been witnessing considerable business upheaval over the last decade because of market dynamics, public sentiments and regulatory environment. To evaluate the soundness of NBFCs in Tamil Nadu over a decade, the authors made an attempt of CAMEL criteria for analysis of selected Companies. For this purpose, out of 36 NBFCs in Tamil Nadu 4 Government Companies, 13 Small Companies and 13 Small Companies and another 13 Top Companies were selected as sample respondents on the basis of multi-stage random sampling, to evaluate soundness of each NBFCs through Capital Adequacy, Asset Quality, Management quality, Earnings and Liquidity, Based on findings the suggestions were offered to overcome the difficulties face by selected NBFCs in their development.
Determinants of Banks’ Financial Performance: A Comparative Study between Nat...inventionjournals
Financial performance is one of the most critical factors having impact on the decision making of the resource providers. And thus to ensure the existence in the ever growing competitive business environment, every institution should be more concerned about the factors affecting their financial performance. This paper specially focuses on identifying the factors having impact on the financial performance of the commercial banks operating in Bangladesh. An effort has also been exerted to determine whether the extent of influence of various factors on financial performance varies with respect to local private and nationalized commercial banks. For this purpose 10 local private commercial banks (PCB) and all nationalized commercial banks (NCB) have been taken covering the period from 2008-2014. Here, data has been collected from the annual reports of the banks under consideration. To draw conclusion a multiple regression has been run by considering financial performance (profitability) as dependent variable and operating efficiency, asset utilization , liquidity, credit risk, capital adequacy and size of the company as independent variables. The study finds that asset utilization and operating efficiency have significant positive impact on banks' financial performance (profitability) whereas credit risk has significant negative impact. However, for PCBs asset utilization is the most critical factor to performance. On the other hand, result shows that in case of NCB 1 taka increase in credit risk is responsible for negative return of 0.968 taka. It is found that financial performance has no significant relationship with size and liquidity of the banks
This document provides an overview of electronic payment and e-finance systems in India. It discusses various electronic funds transfer systems used by banks in India such as Real Time Gross Settlement (RTGS), National Electronic Funds Transfer (NEFT), Electronic Clearing System (ECS), Immediate Payment Service (IMPS), and core banking solutions that allow customers to access accounts from any branch. It also mentions communication networks like INFINET that connect banks and the role of SWIFT and other international payment systems in facilitating domestic and international funds transfers.
Emerging Global Strategies for Indian Industry Bhadrappa Haralayya.pdfDR BHADRAPPA HARALAYYA
- The document analyzes the weak form efficiency of the Indian stock market, with a specific focus on the National Stock Exchange (NSE).
- It employs statistical tests like run tests and autocorrelation tests on monthly closing index values from 2000-2013 to analyze randomness and independence of stock price changes over time.
- The results of the statistical tests show that the NSE is inefficient in the weak form, as past stock price data can be used to predict future price movements, violating the random walk hypothesis of weak form efficiency.
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This document analyzes the financial performance of IDBI Bank from 2008-2013. Some key findings include:
- IDBI Bank's net worth increased 140.71% from Rs. 8,821.96 crores to Rs. 21,236.03 crores over this period.
- Borrowings increased 70.43% from Rs. 38,612.55 crores to Rs. 65,808.9 crores.
- Total assets grew 147.35% from Rs. 130,694.38 crores to Rs. 322,768.5 crores.
- Net profits increased 152.09% from Rs. 746.59 crores to Rs. 1882.
An Analysis on the Non Performing Assets of Public Sector Banks in Indiaijtsrd
The objective of this study is to analyse the impact of Priority Sector Lending PSL on Non Performing Assets NPAs of Public Sector Banks PSBs in India. Further, the study investigates the impact of NPAs of PSBs in India on Gross Advances GAs and Net Profitability. The paper also examines the presence of structural break in the relationship between GAs and NPAs of PSBs due to the Financial Crisis, 2007 08. The results show that PSL has a significant impact on NPAs of PSBs. There is a negative impact of NPAs on GAs and NP of PSBs. There is structural break in the relationship between GAs and NPAs due to financial crisis. Catherine Rachel Jacob | Alan Eapen Philip | Rajalakshmi E R "An Analysis on the Non-Performing Assets of Public Sector Banks in India" Published in International Journal of Trend in Scientific Research and Development (ijtsrd), ISSN: 2456-6470, Volume-6 | Issue-2 , February 2022, URL: https://www.ijtsrd.com/papers/ijtsrd49271.pdf Paper URL: https://www.ijtsrd.com/management/other/49271/an-analysis-on-the-nonperforming-assets-of-public-sector-banks-in-india/catherine-rachel-jacob
This document summarizes recent developments in the Indian banking sector. It discusses how total bank assets have grown substantially over the last decade to Rs 82,99,220 crore. It also notes that bank revenue and profits have increased significantly from 2001-2010. The growth has been driven by foreign investment and conservative RBI policies. Recent union budgets have proposed investments to capitalize banks and promote financial inclusion and agricultural lending. The banking sector is expected to continue growing in line with the strong projected growth of the Indian economy.
Mergers and Acquisitions in Indian Banking Sector A Case of Bharat Overseas B...ijtsrd
Mergers and Acquisitions MandAs continue to be a significant force in the restructuring of the financial services industry. The Indian Commercial Banking Sector, which has played a pivotal role in the country’s economic development, is currently passing through an exciting and challenging phase. The present research papers studies the impact of MandA on the financial performance of Bharat Overseas Bank and Indian Overseas Bank. The study uses key financial ratios to find the impact of MandA on financial performance of selected banks. Dr. Soniya Gambhir "Mergers and Acquisitions in Indian Banking Sector (A Case of Bharat Overseas Bank and Indian Overseas Bank)" Published in International Journal of Trend in Scientific Research and Development (ijtsrd), ISSN: 2456-6470, Volume-5 | Issue-2 , February 2021, URL: https://www.ijtsrd.com/papers/ijtsrd38415.pdf Paper Url: https://www.ijtsrd.com/management/accounting-and-finance/38415/mergers-and-acquisitions-in-indian-banking-sector-a-case-of-bharat-overseas-bank-and-indian-overseas-bank/dr-soniya-gambhir
What are the Stimulating Factors Affecting NPL in Banking Sector of Banglades...ijtsrd
A well organized, well structured and developed financial sector ensures efficient allocation of financial resources and perks up the competitiveness of the private sector, thereby promoting investment and growth in the real sector. The thrust of the development is to improve the regulatory and governance environment and to enhance the ability of bank owners, management and regulators, and the markets themselves to provide for better governance and regulation to achieve the objectives. In this perspective, improvement of the situation of non performing loan is important. A high volume of non performing loan can never be a boon for the economy. Credit to economy is the main source for financial support of business. On the other side, banks have limited investment tools for their deposits. This study present results from an econometric analysis, favorably Random Effect Model, using pooled panel data collected from the central bank of Bangladesh categorizing four sectors of banking based on the pattern of ownership. Based on the analysis of the bank specific microeconomic factors, which are selected on the availability from reliable sources, used as the regressors, it is observed that the liquidity and the management soundness is more significantly affect the Non performing loan NPL in Bangladesh. Therefore, the recommendation is placed towards formulation policy instruments in favor of solvency rather liquidity. In addition to that, the improvement of managerial efficiency must be sought as well. Ratna Biswas | Mohammed Nazrul Islam | Chanu Gopal Ghosh ""What are the Stimulating Factors Affecting NPL in Banking Sector of Bangladesh? Evidence from Econometric Exercises"" Published in International Journal of Trend in Scientific Research and Development (ijtsrd), ISSN: 2456-6470, Volume-4 | Issue-2 , February 2020, URL: https://www.ijtsrd.com/papers/ijtsrd29861.pdf
Paper Url : https://www.ijtsrd.com/economics/financial-economics/29861/what-are-the-stimulating-factors-affecting-npl-in-banking-sector-of-bangladesh-evidence-from-econometric-exercises/ratna-biswas
EFFECT OF NON-PERFORMING ASSETS (NPA) ON PERFORMANCE OF COMMERCIAL BANKS IN I...IAEME Publication
After the liberalization policy of 1991, Indian banking sector change dramatically and measure were taken for making Indian banking sector as a world standard. There are many obstacles faced by Indian banks and increasing NPA is one of them. There are two types of NPA – Gross NPA and Net NPA. For present study Net NPA are considered. Reserve Bank of India (RBI) is monitoring these phenomena and declaring guidelines at various times. After the slowdown of 2008, the threat of increasing NPA and decreasing ROA is witnessed. This paper is an attempt to correlate the NPA and ROA of Indian commercial Banks. Though the sample size is small but all major 11 banks (6 Public sector banks and 5 Private sector banks) where chosen for the study. 2015-16 to 2018-19 is the study period for this study.It is found that in this study period of 4 years, NPA increase rate is higher in public sector banks than the private sector banks. NPA of private sector banks are well under control. This study shows that there is moderate negative correlation of NPA and ROA of Public sector banks. This means as the NPA increasesit negatively affects the ROA of banks.
The document provides details on selecting a portfolio of 10 BSE Sensex companies with a total investment of Rs. 10,00,000 based on analysis to identify stocks that will provide the best returns over 1-2 years. It describes performing fundamental analysis on company financials and market conditions, technical analysis of stock trends, and sector analysis. A portfolio is presented with investments in 8 companies totaling Rs. 10,00,000 that was selected after analyzing each company and sector trends like banking, using factors like growth prospects, government policies, macroeconomic indicators, and global economic conditions.
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ijresm-v4-i5-55 A Study On Structure and Growth of Banking Industry in India.pdf
1. International Journal of Research in Engineering, Science and Management
Volume 4, Issue 5, May 2021
https://www.ijresm.com | ISSN (Online): 2581-5792
*Corresponding author: bhadrappabhavimani@gmail.com
225
Abstract: Financial development is a functioning and consistent
process and banks are the principal players of monetary
advancement of a nation. The productive working of the managing
an account division in India assumes conclusive job in the general
development of the financial system in the nation. The motivation
behind the present part is to bless with a review of Indian saving
money segment execution after the execution of deregulatory
measures amid 1993-94. The procedure of financial deregulation
includes changes in the loan costs, credit rates, store rates,
dimension of rivalry, basic changes, association of predominant
innovation, proprietorship design, facilitating of arrangements,
and so forth in India. These progressions prompted the
advancement of upgraded and enhanced administrations given by
financial middle people, in this way, go about as a vital part for the
general development and development.
Keywords: investment, deposits, NPA, credit-deposits,
investment-deposits.
1. Introduction
The worldwide emergency has drawn fear about the job and
the operational execution of the financial sector in various
economies of the world. It has raised concern with respect to
the pretended by the financial sector for the economic
development of nations. Because of log jam in worldwide
economic advancement, the policymakers have gone up against
with difficulties that have made specialists to manage financial
and fiscal arrangements in a clashing circumstance. It has been
closed from the outcomes that Indian saving money sector does
not rank high on the general score of financial development file.
The rate offer of branches in provincial fragments delineates
decay and with the entry of change process, while, increment in
the store and credit assembly if there should be an occurrence
of banks in metropolitan territories in India has been taken note.
Nonetheless, the procedure of deregulation and changed
approaches has made the development for private and outside
sector banks than the nationalized banks and SBI gathering.
Likewise, the part uncovered that the effect of financial
emergency regarding the most recent couple of years has made
the direction course back to the nationalized banks and SBI
gather as far as advances, speculation and stores than private
and FSBs. The investigation by Acharya and Kulkarni (2011)
affirms this did not occur because of the strength of state
claimed banks than the PSBs and FSB yet because of
unequivocal and understood government support of open sector
banks in India. There has additionally been drop in the level of
parts of nationalized bank and SBI bunch amid 2009-10 with a
peripheral recuperation in 2010-11. Strikingly, the managing an
account sector execution is by all accounts basically influenced
by the financial emergency regarding stores, advances and
speculations. It has been recommended that there have been
critical upgrades in the execution of the Indian keeping money
sector after post-change period, in spite of the fact that the level
of enhancements fluctuate macross diverse markers. The most
critical commitment has been seen if there should arise an
occurrence of profits on resources and profits for value over the
period of time. It has been mirrored that banks confronting the
outcomes of strict standards and controls started by RBI, time
to time, are as yet leading their activities profitability. Another
pointer found to have critical commitment is C-D proportion.
This proportion has appeared after gradual development. The
aftereffects of these pointers are authenticated with the
investigations of What's more, it has been seen that the
proportion of wage bill to add up to costs have declined
altogether, accordingly, mirroring the effect of strengthening
competitive weights. At long last, it very well may be finished
up from the above dialog that saving money sector in India has
given blended outcome after the inception of changes set out by
RBI and legislature of India. It has been affirmed that managing
an account sector in India is developing at a decent pace and in
a sound way with exemption to most recent couple of years. It
has been, further, uncovered that booked business banks in
India have reacted emphatically in the field of profitability,
profitability, resources quality, i.e., decrease of NPAs,
improving the job of market powers, standards of prudential
controls of bookkeeping, salary acknowledgment, provisioning
and presentation, presentation of CAMEL supervisory rating
system and nonstop upgradation of innovation to give better and
proficient administrations to the clients. In any case, it has been
seen that the execution of business banks in India amid 2011-
12 was adapted by the log jam in residential economy combined
with higher loan costs in condition however Indian banks stayed
all around promoted. Financial crisis over the last few years has
made the trajectory direction back to the nationalized banks and
SBI group in terms of advances, investment and deposits than
A Study On Structure and Growth of Banking
Industry in India
Bhadrappa Haralayya1*
, P. S. Aithal2
1
Post Doctoral Fellowship Research Scholar, Srinivas University, Mangalore, India
2
Professor, College of Management and Commerce, Srinivas University, Mangalore, India
2. B. Haralayya et al. International Journal of Research in Engineering, Science and Management, VOL. 4, NO. 5, MAY 2021 226
private and FSBs. The study by confirms that this did not
happen due to the resilience of state owned banks than the PSBs
and FSB but due to explicit and implicit government backing of
public sector banks in India. There has also been drop in the
percentage of branches of nationalized bank and SBI group
during 2009-10 with a marginal recovery in 2010-11.
Interestingly, the banking sector performance seems to be
virtually affected by the financial crisis in terms of deposits,
advances and investments. It has been suggested that there have
been significant improvements in the performance of the Indian
banking sector after post-reform period, although the degree of
improvements vary across different indicators. The most
significant contribution has been observed in case of returns on
assets and returns on equity over the period of time. It has been
reflected that banks facing the consequences of strict norms and
regulations initiated by RBI, time to time, are still conducting
their operations profitability. Another indicator found to have
significant contribution is C-D ratio. This ratio has shown
improvements after slow and steady growth.
2. Comparisons of Economies in Financial Development
Index
The execution, long haul development, welfare and
development of an economy, is identified with its level of
financial development. Higher the level of financial
development, more extensive will be the financial
administrations. The European National Bank, amid 2009 by
building up a composite list utilizing twenty-one pointers,
positioned India twenty-second among thirty nations. The
investigation reasoned that India performed better in the
financial market and require enhancements in the business
condition. An endeavor made by recommended significance of
created financial market for the long-run monetary
development. The examination foreseen rules for future
development of the financial market in India. For an exhaustive
disregard at the financial development of economies, World
Monetary Discussion introduced the Financial Development
Report utilizing the scale extending from 1-7, where 1 being the
slightest and 7 being the most favorable to the financial
development. These reports look for after explicit limitations on
account of radical change in condition and some intriguing
states of economies. It is like manner gives an expansive
structure of the data to the extent record speaking to the
development of financial system. The financial development
list gives an understanding around three noteworthy markers
explicitly factors, approaches and foundations; financial
intermediation and financial access. These files are additionally
portioned into seven pointers i.e., institutional condition,
business condition, financial solidness, bank elements, non-
bank substances, financial markets and financial access
(Financial Development Report, World Economic The
preservationist approach has been received for doling out the
loads to the individual factors. Every one of the pointers have
been relegated the heaviness of 14.29 percent which is further
subject to various parameters related with these seven markers
(see Financial Development Report, World Economic
Gathering, 2013 for subtleties). It has been demonstrated that
regarding by and large positioning on the financial development
record, India has tumbled down to 40th position amid the year
2013 (allude Table 1). The decrease saw amid the year 2013
was because of the European Emergency and ascend in Oil
costs which has influenced every one of the economies of the
world (Financial Development Report, World Economic
Discussion, 2013).
Table 1
Rank wise comparisons of economies in financial development index
Country Rank
Score
(1–7)
2013 2012 2011 2013 2012 2011
Hong Kong 1 1 3 5.31 5.16 5.04
United States 2 2 1 5.27 5.15 5.12
United Kingdom 3 3 2 5.21 5.00 5.06
Singapore 4 4 4 5.10 4.97 5.03
Australia 5 5 5 5.01 4.93 5.01
Canada 6 6 6 5.00 4.86 4.98
Japan 7 8 9 4.90 4.71 4.67
Switzerland 8 9 8 4.78 4.63 4.71
Netherlands 9 7 7 4.73 4.71 4.73
Sweden 10 11 12 4.71 4.51 4.60
China 23 19 22 4.00 4.12 4.03
Federation 39 39 40 3.30 3.18 3.21
India 40 36 37 3.29 3.29 3.24
Indonesia 50 51 51 2.95 2.85 2.90
Source: Financial Development Report, World Economic
Forum, 2013
The relative examination over the period of three years have
appeared out of sixty-four nations, India, as creating country, is
performing great on the seven-point scale. Nonetheless, it has
been seen that India does not rank high on its general score,
however, it is moderately very much set in non-keeping money
financial administrations (ninth) and financial market (twenty-
eighth) (allude Figure 1).
Fig. 1. Rank of indicators on financial development index of India for 2013
Source: Financial Development Report, World Economic Forum, 2013
Economies. Hence, it becomes a topic of concern to analyze
the structure, growth and development of Indian banking sector
over the past two decades. The present chapter has focused on
various indicators to highlight the position of banking sector in
India. The present chapter of the study is divided into two
sections. The first section highlights descriptive measures of
performance using various financial indicators and accounting
ratios. The discussions will reveal the importance of the sound
financial sector, as the necessary condition for progress and
3. B. Haralayya et al. International Journal of Research in Engineering, Science and Management, VOL. 4, NO. 5, MAY 2021 227
development of an economy. In addition, the section has
discussed technological developments introduced by the
banking sector in India. The section second is related with the
measurement of performance of the banking sector in India
using CAMEL approach.
3. Descriptive Measures of Performance
The banking sector in India has registered changes in
framework, regulations, organizational structures and scope of
business activities. It has witnessed rapid growth during the
deregulation of economy. These initiatives have transformed
the entire structure of the banking sector in India and brought
changes in the momentum of operation in banks. As more than
two decades since the initiation of deregulation process
introduced into the India banking sector. The present study tried
to capture the impact of these reforms on the performance
scheduled commercial banks (SCBs) over the period of time.
The number of commercial banks in India has decreased from
284 during Further, the number of SCBs reduced from 289 to
151 (including 82 RRBs) and non-scheduled commercial banks
from 16 to 4 over the period of time.
It has been depicted in the Table 2, that the flow of credit
provided to the priority section (agriculture and small scale
industries) in India shows consistency. There has been growth
observed in the advances provided to priority sector from `
692.0 crore during
The common approach to determine the performance of the
banking sector, wherein the position of bank can be judged, is
in terms of certain key indicators and their ratios. However, all
these indicators are interlinked with each other. The deposit and
credit mobilization determines the core of banking business.
Similarly, the investment of bank in terms of government and
non-government securities hypothesized the source of funds
borrowed from domestic or international market. Further, the
competency of banks can be determined in terms of profitability
ratios like returns on asset, returns on equity, wage bill to total
expenses and technological advancements over the period of
Table 2
Percentage Distribution of Branches, Deposits and Credit of Scheduled Commercial Banks
Year NOCB SCBs PS/TA Branches Deposits Credit
Rural Semi-
Urban
Urban Metro
politan
Rural Semi-
Urban
Urban Metropolitan Rural Semi-
Urban
Urban Metropolitan
1994-95 284 281 692.00 55.90 19.00 14.20 10.10 15.00 18.80 23.20 42.40 14.00 14.00 20.40 51.60
1995-96 284 281 692.00 52.92 21.39 14.22 11.47 15.20 19.50 22.90 42.40 11.90 13.50 18.60 56.00
1996-97 293 291 808.31 52.35 21.52 14.42 11.72 13.70 18.80 22.20 45.30 11.40 13.10 17.70 57.80
1997-98 299 297 938.00 51.79 21.66 14.70 11.85 14.40 19.50 22.40 43.70 11.40 13.10 17.60 57.90
1998-99 300 299 1089.00 51.20 21.77 14.94 12.09 14.70 19.60 22.50 43.20 11.40 12.80 17.60 58.20
1999-00 303 302 1263.00 50.60 21.82 15.24 12.34 14.50 19.40 22.60 43.50 11.00 12.70 17.80 58.50
2000-01 297 297 1557.70 50.04 22.03 15.37 12.56 14.70 19.50 22.90 42.90 10.60 12.20 17.20 60.00
2001-02 301 296 1822.50 49.40 22.14 15.61 12.84 14.70 19.70 23.00 42.60 10.20 11.50 17.40 61.00
2002-03 298 294 2056.00 48.92 22.28 15.83 12.97 14.70 19.60 22.90 42.80 10.20 11.20 16.50 62.10
2003-04 294 289 2546.40 48.55 22.33 16.07 13.05 14.20 19.10 22.80 43.90 10.20 11.30 16.40 62.10
2004-05 291 286 3113.30 47.81 22.46 16.37 13.36 13.80 18.90 22.80 44.50 9.70 11.40 17.10 61.90
2005-06 288 284 4007.70 46.93 22.53 16.82 13.71 12.90 17.70 21.90 47.50 9.50 11.30 16.40 62.70
2006-07 222 218 5467.70 43.22 22.55 17.43 16.80 12.20 16.90 21.50 49.40 8.30 10.00 16.20 65.40
2007-08 183 179 7037.50 42.00 22.87 18.03 17.10 10.80 14.50 20.60 54.10 7.90 9.70 16.30 66.10
2008-09 175 171 8247.70 40.50 23.33 18.71 17.46 9.70 13.80 20.50 56.00 7.60 9.50 15.90 67.10
2009-10 170 166 9674.10 39.37 23.80 19.07 17.77 9.30 13.20 20.20 57.20 7.30 9.30 16.10 67.30
2010-11 169 165 11384.00 38.12 24.35 19.55 17.98 9.30 13.50 21.00 56.20 7.50 9.60 16.70 66.30
2011-12 169 165 13373.30 37.30 25.34 19.38 17.98 9.20 13.50 20.70 56.60 7.30 9.40 16.80 66.60
2012-13 173 169 14713.30 36.92 26.20 19.18 17.71 9.20 13.30 20.60 56.90 7.50 9.45 16.83 66.22
2013-14 155 151 16952.67 37.17 26.71 18.87 17.23 9.22 13.35 20.65 56.78 8.30 10.10 16.43 65.20
Source: Compiled from Various Report on Trend and Progress of Banking in India
Note: NOCB= number of commercial banks; SCBs= Scheduled Commercial Banks; PS/TA = ratio of priority sector advances to total advances
Table 3
Ownership-wise percentage distribution of branches, deposits and credit
Year Branches Deposits Credit
Nationalized
Banks
SBI and its
Associates
Foreign
Banks
Private
Banks
Nationalized
Banks
SBI and its
Associates
Foreign
Banks
Private
Banks
Nationalized
Banks
SBI and its
Associates
Foreign
Banks
Private
Banks
1994-95 49.70 20.20 0.20 6.60 57.30 29.20 7.50 5.50 52.70 32.50 6.50 5.40
1995-96 49.90 20.30 0.20 6.60 53.40 29.20 7.60 6.90 53.40 29.20 7.60 6.90
1996-97 49.90 20.20 0.30 6.80 51.10 29.10 9.00 7.90 51.10 29.10 9.00 7.90
1997-98 49.90 20.20 0.30 7.10 48.90 29.20 9.30 9.50 48.90 29.20 9.30 9.50
1998-99 50.00 20.10 0.30 7.40 48.70 28.60 9.00 10.60 48.70 28.60 9.00 10.60
1999-00 50.10 20.00 0.30 7.60 49.20 28.10 8.20 11.50 49.20 28.10 8.20 11.50
2000-01 50.10 20.10 0.30 7.70 48.70 27.60 8.40 12.40 48.70 27.60 8.40 12.40
2001-02 50.10 20.10 0.30 7.80 48.60 26.80 8.40 13.20 48.60 26.80 8.40 13.20
2002-03 49.80 20.10 0.30 8.20 47.30 25.00 7.30 17.50 47.30 25.00 7.30 17.50
2003-04 49.90 20.10 0.30 8.10 46.80 24.10 7.10 19.00 46.80 24.10 7.10 19.00
2004-05 49.90 20.00 0.30 8.50 46.40 23.70 7.20 19.80 46.40 23.70 7.20 19.80
2005-06 49.80 19.80 0.30 9.10 47.80 23.10 6.60 19.70 47.80 23.10 6.60 19.70
2006-07 49.80 19.80 0.30 9.40 47.90 23.10 6.60 20.00 47.90 23.10 6.60 20.00
2007-08 48.05 19.67 0.37 9.95 48.50 22.20 5.60 20.60 47.60 23.00 6.90 20.00
2008-09 49.84 20.12 0.35 10.69 48.10 23.20 5.50 20.20 48.80 22.10 6.70 19.70
2009-10 49.42 20.38 0.36 11.16 49.40 22.10 5.20 18.20 50.50 23.10 5.90 18.20
2010-11 49.34 20.62 0.35 11.85 51.90 22.30 5.00 17.70 52.00 23.10 4.90 17.50
2011-12 49.37 20.25 0.34 12.82 53.20 21.40 4.40 18.00 53.00 21.90 4.90 17.80
2012-13 49.93 19.55 0.32 13.70 55.73 21.70 4.50 18.10 52.40 22.80 5.00 18.50
2013-14 49.69 19.40 0.31 14.61 55.56 21.78 4.29 18.28 52.61 23.45 5.50 19.44
Source: Compiled from Various Report on Trend and Progress of Banking in India Development.
4. B. Haralayya et al. International Journal of Research in Engineering, Science and Management, VOL. 4, NO. 5, MAY 2021 228
time across different banks.
He comparative position for the branch distribution reveals
that the rural branches of SCBs in India have decreased from
55.9 per cent to 37.17 per cent over the period of time with
slight recovery during terminal years of the study. This fall in
rural branch network was due to continuous focus on up
gradation in technology by banking sector and a progressive
reduction in the physical branches of the banks. Moreover,
during 1998, RBI allowed banks to shut those branches that
were found to face losses for three consecutive years (Reserve
Bank of India, On the contrary, slight improvements have been
observed in the percentage of semi-urban, urban and
metropolitan areas during the post-deregulation period. The
branches in semi-urban, urban and metropolitan have increased
from 19.0 per cent to 26.71 per cent, 14.20 per cent to 18.87.
Fig. 2. Percentage Share for Investments (Annual Growth Rate)
Source: Compiled from Various Report on Trend and Progress of Banking in
India
Fig. 3. Type-Wise Distribution of Deposits (Annual Growth Rate)
Source: Compiled from Various Report on Trend and Progress of Banking
in India
Note: AD = Aggregate Deposits; DD = Demand Deposits; TD = Time
Deposits
The spurt of non-performing resources (NPAs) could
likewise be embraced to the lacking examination and observing
of credit proposition in the household economy. To have further
knowledge of NPAs, the present examination consider the
example pursued by NPAs over gross advances and aggregate
resources amid last one and half decades. The calculation of
NPAs gives insight concerning the correct portion of assets by
the banks in India to the diverse sectors of economy. It has been
anlaysed from Figure 4 that NPA over the period of time has
indicated consistent decay. Along these lines, an impressive
advancement in the recuperation of NPAs and at a similar
period of time, increment in the gross advances and advances
prompted the decrease in this proportion. Further, the
development of Benefit Remaking Organization Constrained
(ARCIL) likewise helped a great deal in the recuperation of
levy. To abridge, the NPAs as a rate to add up to resources has
delineated extreme decrease since 2001-02 and this might be
being because of the enhancements in the credit examination
process, upturn of business cycle, new activities of NPAs like
declaration and new acknowledgment for NPAs from 180 to 90
days. In any case, there is additionally a need to keep check over
the proportion in light of upward movement towards the higher
level during the last few years.
Fig. 4. NPAs Distribution over Advances and Total Assets
(Annual Growth Rate)
Source: Compiled from Various Report on Trend and Progress of Banking in
India
4. Innovative Development in Banks
Throughout the years, RBI and other financial offices in
India have laid uncommon accentuation on the innovation up
gradation in everyday activities of banks in India. To get by
without innovation in managing an account system at present
period is existence without water. The implantation of
innovation in keeping money sector had made managing an
account sector proficient as well as has helped the progressing
procedure of financial incorporation. In the ongoing years,
banks have expanded the quantity of on location (71690) and
off-site (69826) ATMs in different areas and have likewise
begun giving managing an account office through the cell
phones of the clients, accordingly, attempting to convey their
best to the clients and effort the remote territories in India
(Write about Pattern and Advancement of Keeping money in
India, 2012-13).
Anyway with the selection of computerization and center
keeping money arrangement system, banks are presently
concentrating more on client relationship the executives and
attempting to enhance their inside administration data system.
The aggregate number of ATMs for planned business banks
over the period of time has expanded from 27,000 of every 2007
to over 1.6 lakh the nation over in 2013-14. Therefore, in Indian
market, money is for the most part utilized for the retail
advances however the utilization of checks, charge cards, Visas
and other installment instrument are likewise observed to be
utilized at expanding rate. The volume and estimation of
5. B. Haralayya et al. International Journal of Research in Engineering, Science and Management, VOL. 4, NO. 5, MAY 2021 229
exchanges at present with the utilization of cards are
dramatically increased in 2004-05. Thus, sharp increment in
electronic store exchange (EFT) and other related electronic
exchanges have been taken note. The hidden method of
reasoning for the equivalent is that clients are given less
expensive installment system and quicker exchange process
than the paper based instruments.
What's more, the Genuine Occasions Net Settlement (RTGS)
was operationalized amid the year 2004-05 for the exchange of
huge measure of assets at quicker rate. From that point forward,
its significance has expanded step by step. Thinking about the
enormous development in the RTGS system, the specialized
warning gathering of RBI evaluated the system and suggested
the plan of New Age Genuine Occasions Net Settlement (NG-
RTGS) to give all the more brisk and advance exchange
checking and control system to expand the volume of
exchanges through the RTGS system (Investigate Pattern and
Advancement of Keeping money in India, 2012-13). The
installment systems like electronic clearing system (both charge
and credit), country electronic reserve exchange and card based
systems are getting to be prominent as delineated through the
expansion in the volume and estimation of exchanges (allude
Table 4). Further, the development incline in a wide range of
systems particularly ECS (credit) and ECS (charge) has made
critical increment because of the immediate acknowledge, for
example, compensation, annuity installments and direct charge
like accumulation of bills, protection premium, compared
regularly scheduled payments for advances, shopping, and so
on.
5. Accounting Measures for Performance
There has been a gradual change in the technological and
operational environment in the banking sector in India after
1990s. There has been exposure to the competitive environment
with the presence of foreign ownerships. The radical changes in
the capital structure of banks have lead towards diversification
of business activities by the banks. All these changes have made
the way for banks to make their operations efficient. Although,
banks generate multiple products/services unlike firms thus the
performance of banks cannot be analyzed by using usual
yardsticks. Therefore, specifically two types of measures have
been used to measure the performance of the banks i.e.,
accounting measures and economic measures. The present sub
section deals with accounting measures as a tool to measure the
performance of the banks over the period of time. Accounting
measures refer to various financial ratios used to measure the
performance of a banking unit. The present study tries to
analyse performance of banks over the period of time by using
financial ratios like Credit-Deposits (C-D) ratios, Investment-
Deposits (I-D) ratios, ratio of Wage bill to total expenses,
profitability indicators i.e. Return on Assets (ROA) and Return
on Equity (ROE) and Ratio of Operating Profit to total assets.
Fig. 5. Ratio-Wise Analysis for Credit-Deposits, Investment-Deposits and
Wage Bills to Total Expenses
Source: Compiled from Various Report on Trend and Progress of Banking
in India
Fig. 6. Profitability Measures of SCBs in India
Source: Authors elaborations’
These proportions give an understanding about the creation
of aggregate business of Planned Business Banks in India. It is
likewise concurred that the intermediation of assets from savers
to the speculators is the most fundamental commitment of
managing an account sector to the generally speaking economic
development. Figure 5 portrays that C-D proportion has
advanced over the period of time. This proportion
fundamentally indicates payment of bank stores by method for
advances and advances to the clients. As affirmed by the Figure
5, the proportion gives off an impression of being more than
50.0 percent, while, quickening has been seen after 2008-09.
Table 4
Transactions through Retail Electronic Payment Methods
2005-06 2006-07 2007-08 2008-09 2009-10 2010-11 2011-12 2012-13 2013-14
Volume (in thousands)
ECS Credit 44216 69019 78365 88394 98100 117000 122000 122180 152540
ECS debit 35958 75202 127120 160055 149300 157000 165000 176530 192910
EFT-NEFT 3067 4776 13315 66340 132340 226110 281000 394130 661010
Credit Card 156086 169536 228203 259561 230550 265000 320000 399130 512030
Debit Card 45686 60177 88306 127654 182000 237000 328000 599921 670710
Value in crore
ECS Credit 32324 83273 782222 97487 117613 181686 183800 177128 249219
ECS debit 12986 25441 48937 66976 69524 73646 83400 108310 126796
EFT-NEFT 61288 77446 140326 251956 409507 939149 1790350 2902242 4378552
Credit Card 33886 41361 57984 65356 58890 75500 96600 1863736 155672
Debit Card 5897 8172 12521 18547 28624 38700 53400 1739344 2060286
Source: Compiled from Various Report on Trend and Progress of Banking in India
6. B. Haralayya et al. International Journal of Research in Engineering, Science and Management, VOL. 4, NO. 5, MAY 2021 230
Then again, the opposite pattern has been knowledgeable about
instance of I-D proportion. Be that as it may, the declining
pattern of stores and their constituents' along with growing
worries towards NPAs in the course of the most recent couple
of years can be considered as the matter of worry for the
managing an account sector, in this manner, driving an effect
on the I-D proportion.
6. Conclusion
The results of these indicators are corroborated with the
studies of Bhatia (1978); Reserve Bank of India. In addition to
this, it has been observed that the ratio of wage bill to total
expenses have declined significantly, thereby, reflecting the
impact of intensifying competitive pressures. Finally, it can be
concluded from the above discussion that banking sector in
India has provided mixed result after the initiation of reforms
embarked by RBI and government of India. It has been
confirmed that banking sector in India is growing at a good pace
and in a healthy manner with exception to last few years. It has
been, further, revealed that scheduled commercial banks in
India have responded positively in the field of profitability,
productivity, assets quality, i.e., reduction of NPAs, enhancing
the role of market forces ,norms of prudential regulations of
accounting, income recognition, provisioning and exposure,
However, it has been observed that the performance of
commercial banks in India during 2011-12 was conditioned
by the slowdown in domestic economy coupled with higher
interest rates in environment though Indian banks remained
well capitalized.
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