Non-Performing Assets in Public Sector Banks, Private Sector Banks, and Foreign Banks: A Comparative Study

Abstract

The role of the banking sector in a nation's economic progress is of paramount importance. Evaluating the asset quality stands as a critical yardstick for assessing bank performance. Over the past two decades, the issue of Non-Performing Assets (NPAs) has emerged as a significant challenge, posing complexities for banks. The handling of NPAs by public, private sector banks and foreign has garnered notable attention. This article investigates into a study of the contemporary NPA trends within India's public, private sector banks and foreign banks during different phases of the banking sector which include the period prior to global financial crises, post global financial crises period, and banking merger and consolidation period. The study involves a comparative analysis of NPAs using descriptive statistics. A Panel data analysis is used to find the different macro-economic and bank specific factors contributing to the observed distinctions and explore the strategies harnessed for the effective management of these assets.