AN ANALYTICAL INSIGHT INTO NON-PERFORMING ASSETS AND THE INDIAN BANKING SYSTEM
AN ANALYTICAL INSIGHT INTO NON-PERFORMING ASSETS AND THE INDIAN BANKING SYSTEM

Summary/Abstract: One of the main issues facing Indian banks is Non-Performing Assets. NPAs show how well banks are doing. A high percentage of non-performing assets (NPAs) indicates a significant likelihood of many loan defaults, which can have an impact on the profitability of a bank and net worth as well as the asset's value. Non-Performing Assets (NPAs) are a problem for Indian banks. The existence of NPAs has a significant impact on the banks' ability to generate income and profitability. In addition, the non-performance or non-receipt of interest and principal restricted banks' money in the form of funds and prevented their usage for further banking operations, resulting in a decline in the banks' profit margin. In this context, the bank must be aware of the issues and NPA recovery laws. Understanding the amount of Non-Performing Assets (NPAs) and how it affects the profitability of the banks is the goal of the current study. The study took into account the Gross and Net NPA of Public & Private sector banks from 2016 to 2022 for this objective. The analysis found that during the time, the Gross & Net NPA of both public and private sector banks gradually increased. According to this study, there is a strong correlation between the Gross NPA and Net NPA of banks in the public and private sectors. In order to lower the NPA and strengthen the recovery system, this paper advises regulators and the appropriate bank authorities to take the necessary actions.

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