A CRITICAL ANALYSIS OF NON-

PERFORMING ASSETS OF A BANK.

GROUP 2

DURWA MARGAJ (19305A0006)

ESHA PAWAR (19305A0007)
NANDINI GUPTA (19305A0008)
VISHAL MORE (19305A0009)
RIYA GUPTA (19305A0010)
ABSTRACT
Banking sector plays a key role in financial performance and economic growth. the
most crucial factor which measures health of the banking industry is the size of NPA’s.
NPA have direct impact on the financial performance of the bank i.e. their
profitability, in term of rising cost of capital. The India banking sector has been facing
serious problem of raising NPA. the problem of NPA is not only affecting the banks
but also whole economy so that it is necessary to trim down NPA to improve financial
health in banking system. The objective of the study is to find the level of NPA of
banking sector in India and the impact of NPA on profitability and financial
performance of the bank.
INTRODUCTIO
N
 Loans and advances given
 Did not repay the loan
 Did not pay the interest for more than 90 days
 Bad Loan
OBJECTIVE
1. TO UNDERSTAND CONCEPT OF NON-PERFORMING ASSETS (NPA).

2. TO STUDY THE NON-PERFORMING ASSETS AT COMMERCIAL BANK.

3. TO FIND THE GENERAL REASONS FOR ASSETS TO BECOME NON-PERFORMING.

4. TO IDENTIFY IMPACT OF NON-PERFORMING ASSETS ON PROFITABILITY.

SOME BASIC REASON BEHIND CREATION
OF NON-PERFORMING ASSETS.
NPA s are always known by the term called “ Bad Loans” or sometimes defaults. These
defaults can occur due to some reasons :

 Bad lending practices by banks.

 A banking crisis.
 Overhanging component ( due to environmental reasons, business cycle, etc. )
 Incremental components ( due to internal bank management, like credit policy, terms
of credit, etc )
ANALYSIS AND FINDINGS

ASSESSMENT OF PRIVATE SECTOR BANKS.

1. ASSESSMENT AT THE INDIVIDUAL LEVEL.
2. COMPARING PERFORMANCE AGAINST THE MEAN

PERFORMANCE ASSESSMENT OF SBI AND ITS ASSOCIATED.

1.ASSESSMENT AT INDIVIDUAL LEVEL.
REVIEW OF LITERATURE
1. Shanabhagara Raghavendra (2018), this paper analyzed the impact of the npa , causes of
NPA, and consequences of NPA in a commercial bank.
2. Suvitha k Vikram, Gayathri g (2018), their study focused the sector, which has higher NPA
(public/ private sector bank) , cavies and control measures for rising NPAS.
3. Kumar Samanta (2017), this analysis indicated the overall NPA position of the all the banks is
Detenorating over the year.
4. Samir and Deepa karma (2013) this study found that the problem of NPA position is greater
in the public sector banks as compared to private and foreign banks in India .
5. Ramchandra Reddy (2012) it observed from the study that there is a tremendous decline in
NPAS of Andhra bank as well in public sector banks during the study period.
CONCLUSION
So many things and repercussions have been faced by the Indian economy due to
this and there is a need to take some urgent remedial measures which can be
related to technology and data analytics to identify the early warning signals.
For the credit assessment, there should be some development of internal skills and
there should be some forensic audits to understand the intent of the borrower.
THANK YOU