Analysis of Non-Performing Assets (NPAs) Among SBI Bank and ICICI Bank for Operating 2011-2018

Abstract

Background: At present the NPAs are considered a big problem in banks. The problematic NPAs in the Indian banks are the foremost and the formidable problematic that has stunned the whole banking industry. Objective: The study is conducted to analyze the non-performing assets (NPAs) among state bank of India (SBI) and ICICI for which the secondary data is used. Method: The study is being done by using seven years (2011-2018) data gathered from annual reports. Results: The study highlighted that there was not any significant change in Gross NPAs / Gross advances ratio, Gross NPAs/ Total assets ratio; Net NPAs/Net advances ratio and Net NPAs/ Total assets ratio with SBI bank when compared to ICICI bank. In SBI, there is significant negative correlation between Gross NPA and Net Profit and between Net NPA and Net Profit. In ICICI bank, we also have observed negative correlation between Gross NPA and Net Profit and Net NPA and Net Profit but then it was not significant as in SBI. Total provision ratio was significantly higher in ICICI bank when compared to SBI bank. However, Shareholder’s risk ratio was comparable among both ICICI bank and PNB bank. In addition to there was significant decrease of amount outstanding in ICICI bank as compare to PNB bank. However provision thereon (of total assets) was comparable among SBI bank and ICICI bank. Conclusion: The study clarify that the magnitude of NPAs is increasing in SBI bank as compared to the ICICI banks. As the magnitude of NPAs is increasing in SBI bank compared to the ICICI banks. SBI bank has to give attention on their effective working to compete with ICICI banks. Therefore, SBI banks need to efficiently to regulate their NPAs with the purpose of increase their profitability.