FINAL RESEARCH PROJECT

ON

Mounting Non-Performing Assets: A Malady to the

Growth of Indian Banking Industry
SUBMITTED IN PARTIAL FULFILLMENT OF THE REQUIREMENTS
OF
PGDM FULL TIME PROGRAM
(2013-2015)

SUBMITTED TO:

SUBMITTED BY:

Prof. Bhagwan Jagwani

Kratika Jaiswal (1679)

DR. GAUR HARI SINGHANIA INSTITUTE OF MANAGEMENT AND

RESEARCH, KANPUR

ANALYSIS
Assumptions:
o The sectors taken for study are Commercial Banks in India.
Public Sector Banks.
Private Sector Banks
Foreign Banks
o The data has been taken for last 5 years i.e., 2012-13, 2011-12, 2010-11, 2009-10,
2008-09.
o The Macroeconomic indicators have been taken for an average of last 5 years
data.
NPA
GDP
Bank credit growth
Average Inflation
Investment Growth
Interest Rate
Sector
o Banks with data of less than 5 years have been excluded from study.

Dependent Variable:
NPA
Independent Variable:

GDP
Bank credit growth
Average Inflation
Investment Growth
Interest Rate
Sector

Technique Used: Multiple Regression

Findings:
o In Anova Table, the significant value is .012 which is less than 0.05 which
indicates that model is significant.
o R square value is coming out to be .170 which explains that there is 17% variance
in the dependent variable.
o Checking further in coefficients table that which variable is significant, only
sector have significant value less than 0.05 i.e., 0.02. Hence, its only sector that
effect the NPAs.

o Sector has the highest Beta value 0.425, stating the highest variable effecting
magnitude.
o To judge that model is stable, we check the VIF value. As the VIF value for all
variables is less than 4, hence, the model is stable.

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