Comparative Study on NPAs (With Special Reference to Scheduled Commercial Banks, Public Sector Banks and Foreign Banks in India)

Due to greater emphasis on developmental and social banking, the quality of loan is affected. The quality of loan portfolio is very critical for the health of a bank. Contaminated loan portfolio is definitely a bane for any bank. It puts a severe dent on the profitability of a bank where it is out of proportion. Managing NPAs should be pro-active function than a reactive response. As management of Non-performing assets has direct bearing on the bottom lines of banks, it needs highly focused and professional approach. The main objectives of the study are to analyse the impact of NPAs of Scheduled Commercial Banks, Public Sector Banks and Foreign Banks in India. The data for the present study are collected from secondary sources. Twelve years of Gross NPAs, Net NPAs, Gross NPAs as Percentage of Gross Advances, Net NPAs as Percentage of Net Advances, Gross NPAs as Percentage of Total Assets, Net NPAs as Percentage of Total Assets data from 2002-03 to 2013-14 of Scheduled Commercial Banks, Public Sector Banks and Foreign Banks in India been collected from the official websites of Reserve Bank of India (rbi.org.in) and various other reports like magazines, journals, published books. The data collected for the study has been analysed logically and meaningfully to arrive at meaningful conclusions. The statistical tools applied for data analysis is descriptive and inferential statistics. E-views are used. Based on the objectives, the hypotheses formed for analysis. To sum up, Compound Annual growth rate of Gross NPAs and Net NPAs of all banks under study are not less than 12% during the study period. They have maintained consistency in their growth since their coefficient of variation is less than one. Hence, NPAs should be arrested on warfooting otherwise, it will have disastrous effect on its survival and sustenance