Performance Appraisal of Indian Banks Using CAMELS Rating

There has been some improvement in the Indian banking sector after the reforms, and CAMELS framework is a natural framework to analyze this improvement. The present study compares the performance of public sector banks with private/foreign banks under the CAMELS framework. The data used for the study were the audited financial statements of a sample of 58 Indian banks for the period 2003-08. The results of the study show that private/foreign banks fared better than public sector banks on most of the CAMELS factors in the study period. The two contributing factors for the better performance of private/foreign banks were Management Soundness and Earnings and Profitability