A STUDY OF NON-PERFORMING ASSETS AND PROFITABILITY IN INDIAN BANKING SECTOR

Abstract

Banking sector is one of the most important sectors of Indian Economy. Banking sector can be grouped into Public banks, private sector banks and foreign sector banks. Nowadays all the banks are facing the problem of Non-performing assets either it be the case of public banks or private sector banks. Non-performing assets are those assets where the lender of the money loses the money due to non-payment of principal amount or Interest amount by the borrower. This research paper analyses the problem of NPAs of selected Public and Private sector banks by evaluating the impact of profitability on Non-performing assets. Using secondary data, the study also compares the Gross NPAs of Public banks in priority and nonpriority sector for a period of five years from 2013-2017.The results of the study concluded that Gross NPAs negatively affects the profitability.