Relationship between Non-Preforming Assets (NPA) and Profitability of Development Banks: The Case of India

Manu, K S; Maheshwari, Rakhi

doi:10.5958/2249-7323.2018.00047.0

Cited by 4 publications

(3 citation statements)

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“…Gaur and Mohapatra (2021) indicate a negative association of NPA with profitability. Manu and Maheshwari (2018) found mixed results on the association between NPA and profitability in banks in India. As it is observed in earlier studies that NPA negatively impacts profitability, it would be worthwhile to examine the ICT's impact on banks' profitability under the effect of NPA.…”

Section: Review Of Literature and Hypotheses Developmentmentioning

confidence: 99%

The Impact of ICT on the Profitability of Indian Banks: The Moderating Role of NPA

Thakur

Rastogi

Parashar

et al. 2023

JRFM

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The role of Information and Communications Technology (ICT) cannot be ignored in today’s era of working. Its effects are studied in several sectors by various researchers. This study covers the impact of ICT on the profitability of banks. Thirty-three banks are operating in India. A sample period of 10 years (2010 to 2019) was studied. The study also provides insight into how ICT helps the banks’ profitability during and post-COVID-19. A panel data analysis is performed to estimate the results. This study found that ICT adversely impacts banks’ profitability (NIM) in India in a linear association. However, the quadratic association indicates a positive U-curved relationship between ICT and profitability. In addition, the Net of Non-Performing Assets significantly but negatively impacts the connectivity of ICT and profitability. The findings imply that banks should invest in ICT to maximize the long run. The findings have no significant implication on all stakeholders, including policymakers, shareholders, and managers, to consider implementing ICT tools as an essential factor in enhancing a bank’s profitability in the long run. In addition, the level of otherwise lowered investments in ICT cannot be a fruitful step. The current study augments the existing literature on banking by providing novel evidence on the association of ICT with profitability under the influence of NPA. This study argues for the application of ICT in banks in order to increase their profitability. ICT helps the bank maintain transparency, accountability, and even the reach of financial services increases. This situation again leads to the enhancement of the country’s economy.

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Section: Review Of Literature and Hypotheses Developmentmentioning

confidence: 99%

The Impact of ICT on the Profitability of Indian Banks: The Moderating Role of NPA

Thakur

Rastogi

Parashar

et al. 2023

JRFM

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“…To know the position of NPA in banking groups and it anticipated the facts of Gross NPA of all Public Sector Bank, Nationalised Bank, SBI Group, Private Sector Bank, All Scheduled Commercial Bank. Manu and Maheshwari (2018), in their study, the Non-performing assets have been varying from time to time which effect the bank's profitability during the study period. The study reflects ROA, ROE and ROCE as measures bank's profitability, Gross NPA and Net NPA as measures non-performing assets of the banks.…”

Section: Literature Reviewmentioning

confidence: 99%

Impact of non-performing assets on the profitability in Indian scheduled commercial banks

Nachimuthu¹,

Veni²

2019

Afr. J. Bus. Manage.

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Banking in modern times is the kingpin of all economic activities. It is instrumental in shaping the economic destiny of a country. Banks are considered as the nerve-centres of economics and finance of any nation and the barometer of its economic prospective. Since the banks have stupendous investment potential, they can make a significant contribution in eliminating poverty and problem of unemployment. It can bring about a progressive reduction in inter-regional/ state, inter-sectoral and inter-personal disparities in India. The banking sector is facing the problem of rising NPAs at present. The purpose of the study is to measure the impact of NPAs on the profitability of Indian scheduled commercial banks for the period of ten years. The study discusses the impact of NPA on the profitability in India scheduled commercial banks for the past ten years from 2007-2008 to 2016-2017. The ratio analysis, regression analysis, tests of equality of means, cross correlogram with the help of E-Views 10 software were used to identify the variables pertaining to NPAs on the profitability of the banking sector. There is an increasing trend of NPAs of Scheduled commercial banks in India.

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“…For the purpose of study, the researcher used secondary data that spanned 15 years, as well as correlation and regression analysis as statistical tools. A researcher has reached the conclusion that NPAs and ROA have a connection that is unfavorable to one another (Manu & Maheshwari, 2018). (Almaqtari et al, 2019;Kavitha & Muthukrishna, 2019) explain that the amount of nonperforming loans (NPA) in public and private sector banks, as well as the effect of NPA on profitability, were the foci of the research project.…”

Section: Introductionmentioning

confidence: 99%

A Case Study on Gross and Net Non-performing Assets of State bank of India

Jayantilal¹

2022

jommerce

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The main objective of present study is to examine Gross non-performing assets and net non-performing assets of State Bank of India. For the present case study researcher has select five years period of study started from 2015-16 to 2019-20. Researcher has selected five NPA ratios; Gross NPA, Net NPA, Provision coverage ratio, Cash deposit ratio and Interest spread ratio. Chi- square test; time series analysis (Manually calculated) is applied on selected ratios of non-performing assets of State Bank of India. The study found out that there is no significant association in all selected ratios of state bank of India. It means in all the selected financial years ratios of non-performance assets is similar and null hypothesis is accepted. In this era banking sector has major suffer from non-performing assets. State bank of India is oldest bank with higher market capital. The paper investigates NPA of State Bank of India. This study helps to investors & managerial board for decision making.

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Relationship between Non-Preforming Assets (NPA) and Profitability of Development Banks: The Case of India

Cited by 4 publications

References 0 publications

The Impact of ICT on the Profitability of Indian Banks: The Moderating Role of NPA

The Impact of ICT on the Profitability of Indian Banks: The Moderating Role of NPA

Impact of non-performing assets on the profitability in Indian scheduled commercial banks

A Case Study on Gross and Net Non-performing Assets of State bank of India

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