Performance of the Indian Banking Sector – An Empirical Examination

Abstract

A fundamental role of the banking sector in India is observed with regards to the social as well as economic development of the country. Sustainable economic growth can be achieved only if a healthy and robust banking system exists within the country. The banking sector’s performance is a closer link to the economy than perchance that of other segments. After nationalization of banks in 1969, a remarkable level of prominence as well as expansion of nationalized and public sector banks were witnessed and today the banking sector in India is well regulated and adequately capitalized. In recent years, there has also been tremendous growth and expansion in private banks in India. The current research aims at mapping the performance and financial health of banks based on basic parameters like income, expenditure, profit, loans, deposits and interest. Ratio analysis is used to scrutinize performance of the banks considered for the purpose of this study. T-Test has been used to establish the existence of any noteworthy difference between financial ratios of the considered Indian private and public sector banks.