A Comparative Analysis of Non-Performing Assets (NPAs) of Selected Commercial Banks in India

With the introduction of international norms for income recognition, asset classification and provisioning in the banking sector, managing NPAs has emerged as one of the major challenges facing Indian banks. Banks today are judged not only on the basis of number of branches and volume of deposits but also on the basis of quality of assets. Non-performing assets constitute a major portfolio of the Banks portfolio and hence are an inevitable burden on the banking industry. NPAs adversely affect the profitability, liquidity and solvency of the banks. This paper analyses the position of NPAs in selected banks namely State Bank of India (SBI), Punjab National Bank (PNB) and Central Bank of India (CBI). It also highlights the policies pursued by the banks to tackle the NPAs and suggests a multi-pronged strategy for speedy recovery of NPAs in banking sector