Indian Banking Sector Research Articles

An analysis of Indian banks' CSR initiatives

A corporation or organization can simply increase their goodwill in the marketplace by engaging in corporate social responsibility (CSR) activities. Upholding moral principles and benefiting society are the overarching goals of corporate social responsibility. CSR takes into account both internal and external elements in addition to the value for their customers. Businesses gain by contributing significantly to corporate social responsibility (CSR) in a number of ways, including enhanced funding availability, new opportunities, employee retention, stakeholder satisfaction, and brand image. As globalization accelerates, banks are becoming increasingly engaged in corporate social responsibility initiatives to broaden their clientele. The corporate social responsibility (CSR) programme of the Indian banking sector focuses on projects like health and medical care, rural area development, and poverty eradication. It also aims to address financial inclusion, provide financial services to support national investment, and promote the socio-economic development of the country. The Bank's corporate social responsibility endeavours are predominantly centred around environmental sustainability, Swachh Bharat Abhiyan, and educational initiatives such as Beti Bachao Beti Padhao Abhiyan, among numerous other projects. This study's goal is to evaluate the CSR programs that the banking sector has implemented. The bank's CSR report is the source of the data.

Performance of Scheduled Banks in India

Purpose: The purpose of this study is to analyze and compare the financial performance of scheduled banks in India, specifically focusing on the distinction between public sector banks and private sector banks. By utilizing financial ratios obtained from secondary data sources such as the Reserve Bank of India (RBI), the study aims to uncover intrinsic differences and similarities between these two sectors. The ultimate goal is to provide insights that can inform decision-making and policy formulation for stakeholders such as policymakers, industry practitioners, and enthusiasts interested in the Indian banking sector. Research Design: The research design employed in this study is primarily quantitative and comparative. The study utilizes secondary data obtained from sources like the RBI and money control, covering a period from 2013 to 2023. A sample size of 12 public sector banks and 21 private sector bank is selected for analysis. Financial ratios such as net profit margin, operating profit margin, return on assets, and others are calculated and compared across the selected banks to assess their financial performance. Comparative analysis, aided by tools like Excel and graphical representations, is used to interpret the data and identify trends and patterns over the ten-year period. Results and Findings: The results of the study reveal significant variations in the financial performance of scheduled banks in India, particularly between public sector and private sector banks. HDFC Bank emerges as a top performer, consistently demonstrating high net profit margins, positive operating profit margins, and robust returns on assets. On the other hand, banks like IDBI Bank, IDFC First Bank Ltd., and Yes Bank Ltd. exhibit poor performance across multiple indicators, including negative operating profit margins and low returns on assets. Several banks, including ICICI Bank and Axis Bank, display inconsistent performance, indicating areas for improvement in operational efficiency and cost control. Overall, the findings underscore the importance of maintaining stable profitability, effective asset utilization, and prudent cost management strategies for sustainable growth in the banking sector. Originality of the Study: This study contributes to the existing literature on the Indian banking sector by providing a comprehensive analysis of the financial performance of scheduled banks, with a specific focus on the distinction between public and private sectors. By utilizing a ten-year dataset and employing financial ratios as analytical tools, the study offers valuable insights into the dynamics of the banking industry in India. Furthermore, the comparative approach adopted in the study enhances its originality by allowing for a nuanced examination of performance trends and patterns across different banks. Overall, the study fills a gap in the literature by addressing the need for empirical research on the financial performance of scheduled banks in India, thereby offering valuable implications for policymakers, industry practitioners, and other stakeholders.

Post-amalgamation Performance Review of Six Public Sector Banks in India

Consolidation of public sector banks (PSBs) is a part of reorganisation efforts with an aim to improve their profitability, solvency and efficiency. Of late merger of five subsidiaries of State Bank of India and Bharatiya Mahila Bank Ltd with it in April 2017 has kindled interest in restructuring of unprofitable banks by merging them with a profitable one. In August 2019, the Government of India announced amalgamation of 10 PSBs constituting them into four entities under Punjab National Bank, Canara Bank, Union Bank of India and Indian Bank. Earlier in April 2019, another merger had taken place following the integration of Dena Bank and Vijaya Bank with Bank of Baroda. Studies reveal that while in European countries bank mergers led to improved efficiency, in Asian countries like Indonesia recapitalisation and diversification of banks improved their profitability. In a study of Nigerian banks in Africa it is revealed that post-merger, employee morale diminishes due to stress and anxiety arising out of possible job loss and possible challenges to be met in the new environment. In the present study, the authors have tried to ascertain how profitability, solvency and efficiency of banks improved post-amalgamation in six PSBs. The outcome of the result is a mixed one, while some banks improved their profitability and solvency parameters, for others it is not so perceptible. However, efficiency indicators do not have any significant result for all six of them after amalgamation.

Review Paper- “A STUDY ON INTROUDUCTION TO THE BANKING SECTOR IN INDIA”

The banking sector in India plays a pivotal role in the country's economy, acting as a backbone for financial intermediation and economic growth. Over the past decade, the sector has witnessed significant transformation driven by regulatory reforms, technological advancements, and changing consumer preferences. The banking sector in India is a critical component of the country's economy, serving as a catalyst for financial inclusion, economic growth, and development. This abstract provides a concise overview of the key aspects shaping the Indian banking landscape. It highlights the regulatory reforms undertaken by the Reserve Bank of India (RBI) to strengthen the sector's stability and resilience, including the implementation of Basel III norms and the introduction of frameworks like Asset Quality Review (AQR) and prompt corrective action (PCA). The abstract also emphasizes the transformative impact of digital technologies on the banking sector, driving innovation, enhancing customer experience, and expanding access to financial services. Furthermore, it discusses the challenges faced by Indian banks, such as non-performing assets (NPAs) and stressed assets, and the initiatives undertaken to address these issues, including the insolvency and bankruptcy code (IBC). Despite challenges, the abstract underscores the significant growth opportunities in the Indian banking sector, fueled by demographic trends, urbanization, and increasing financial literacy. Overall, the abstract suggests that while the Indian banking sector faces both opportunities and challenges, it remains a dynamic and integral part of the country's economic landscape, poised for continued evolution and growth. Keywords – Banking Regulation, Reserve Bank of India (RBI), Financial Inclusion, Digital Banking, Insolvency and Bankruptcy Code (IBC).

A Study on Customer Relationship Management in Banking Sector

ABSTRACT Customer Relationship Management (CRM) plays a pivotal role in the Indian banking sector, offering a strategic approach to managing relationships with customers and enhancing their experience. This paper examines the impact of CRM on the banking industry in India, exploring how it can improve customer satisfaction, loyalty, and overall business performance. The study reviews existing literature and analyzes various aspects of CRM adoption in Indian banks, including challenges such as training, technology adoption, and changing customer expectations. The findings indicate that CRM strategies can significantly enhance the quality of customer service and strengthen customer relationships, leading to higher retention rates and a competitive edge in the market. Despite the challenges in implementing CRM, such as technological constraints and a lack of skilled personnel, the benefits far outweigh the obstacles. Through the effective use of CRM tools and techniques, Indian banks can foster stronger connections with customers, tailor services to individual needs, and ultimately drive growth and profitability. This paper concludes that the adoption of CRM in the Indian banking sector is essential for banks to thrive in a rapidly evolving market. By embracing CRM practices, banks can achieve higher levels of customer satisfaction and loyalty, which are crucial for long-term success in the industry.

Impact of board gender diversity on performance of public sector vis-à-vis private sector banks in India

PurposeThe Companies Act of 2013 stressed upon gender diversity in the board of management considering the significant role of women toward the success of an organization. Following it, both public and private sector banks in India implemented the act from 2015 onward. This study aims to investigate whether its implementation has improved board gender diversity uniformly across public and private sector banks. Furthermore, the authors study the impact of board gender diversity on the performance of public and private sector banks in India.Design/methodology/approachSecondary data on listed Indian commercial banks for the period 2015–2021 have been used in this study that encompasses 15 commercial and 12 public sector banks. Return on assets, return on equity and Tobin’s Q are considered as the banking performance indicators in this study, while gender diversity of the board is measured by using Blau index. Furthermore, generalized method of moments has been adopted to analyze the effect of board gender diversity on performance of the Indian banking sector.FindingsEmpirical results exhibit that board gender diversity has been gradually improving since 2015 in both public and private sector banks in India. However, board diversity in case of public sector banks is seen to be lower than that of private sector banks. Furthermore, this study found a significant impact of board diversity on the performance indicators of both public and private sector banks.Practical implicationsThis study gives a clear picture that board diversity of both public and private banks has remained quite low over the years. Apparently, women representation has been found to be less than 50% throughout the period of 2015–2021. As board diversity has significant impact on banking performance, it is important on the part of banks to take proper steps to improve the board diversity.Originality/valueThis study has added to the existing literature by highlighting on the divergence between gender diversity across public and private sector banks in India. It emphasizes on the need to improve gender diversity by a significant increase in the proportion of women in the board to create an impact on decision-making.

Technological Innovation in Indian Banking Sector: Some Recent Developments

Technological Innovation in Indian Banking Sector: Some Recent Developments

Effect of Mergers and Acquisitions in the Indian Banking Sector: A Case Study on Bank of Baroda

Effect of Mergers and Acquisitions in the Indian Banking Sector: A Case Study on Bank of Baroda

A Comparative Study of Non-performing Assets Between Some Public and Private Sector Banks in India

The Indian banking sector is the backbone of the Indian Economy because it reflects the financial and economic condition of the nation. The failure of the banking sector will adversely impact on the other sectors. The earning capacity and profitability are highly affected because of the existence of NPA. There are many research conducted on the topic of non-performing assets of various banks but in this research, we tried to make a comparative study of some public and private sector banks concerned with NPA.

NEED FOR EFFECTIVE TALENT MANAGEMENT PRACTICES IN BANKING -A BIBLIOMETRIC ANALYSIS

Over a decade the banking practices in the country has been experiencing sea change with the implementation of number policy related changes, rise in privatisation and also due to technology upgradations. Modern-day banking activities have become more complex and complied with high-end technology intervention. It makes bank employees more sensitive towards their job. Thus, retain the existing work force with required skill sets is a dauting task for the administrations of banks. Talent management activities of banks generally revolve around employee engagement monitoring their performance, establishing connectivity between employee and the banking institution and they’re by achieving bank’s goal. It is concluded that talent management is an emerging issue and most focused topic in Indian banking sector. This task compliance with stringent procedures and time consuming too. Hiring talent in this pursuit and retaining them involve myriad steps to make the employees i.e., stimulate them to learn new concept and practice it in their day-to-day work adopt continuous training and monitor the performance of the employees KEY WORDS: Talent Management, Public Sector Banks, Private Sector Banks, Competition

Impact of Artificial Intelligence on Indian Banking Sector- A Study of Banks

Artificial intelligence, or AI, is a cross-disciplinary approach to understanding, modeling, and creating intelligence of various forms. It is a critical branch of cognitive science, and its influence is increasingly being felt in other areas, including the humanities. Intelligence might be defined as the ability to learn and perform suitable techniques to solve problems and achieve goals, appropriate to the context in an uncertain, ever-varying world. A fully pre-programmed factory robot is flexible, accurate, and consistent but not intelligent. Artificial Intelligence (AI), a term coined by emeritus Stanford Professor John McCarthy in 1955, was define as “the science and engineering of making intelligent machines”. Much research has humans program machines to behave in a clever way, like playing chess, but, today, people emphasize machines that can learn, at least somewhat like human beings do. Autonomous systems can independently plan and decide sequences of steps to achieve a specified goal without micro-management. A hospital delivery robot must autonomously navigate busy corridors to succeed in its task. In AI, autonomy doesn’t have the sense of being self-governing common in politics or biology.

Credit Growth and Risk Management in Indian Banks: Analysis Through Sectoral Deployment

This research paper explores the dynamics of sectoral credit deployment and its impact on risk management within the Indian banking sector over three fiscal years (2021-2023). Utilizing data from the Reserve Bank of India's annual reports, the study delves into the growth patterns of credit allocation to agriculture, industry, services, and personal loans, and assesses corresponding risk metrics such as the Gross Non-Performing Assets (NPA) ratio, Provision Coverage Ratio (PCR), and Capital Adequacy Ratio (CRAR). Descriptive statistics, correlation analysis, and regression modelling were employed to identify relationships and impacts. The findings reveal substantial credit growth in the services and personal loan sectors, accompanied by significant improvements in risk management indicators, including a marked reduction in the Gross NPA ratio and enhanced Provision Coverage Ratios. These trends highlight the sector’s increasing resilience and risk preparedness, reflecting broader shifts towards a consumer-driven financial landscape. The paper discusses the implications of these findings for banking stability and economic policy, emphasizing the need for nuanced regulatory frameworks to manage sector-specific risks. Future research could extend this analysis to predict long-term impacts of credit expansion on financial stability using advanced econometric models.

Measuring Impact of CAMELS Model on Financial Performance of Indian Commercial Banks

The purpose of this study is to examine the effects of CAMELS components on the financial performance of Indian commercial banks. To fulfill the objectives of the study,secondary data were collectedfor the fiscal year 2016 to 2021 from four public sector and four private sector banks based on their market capitalization. To analyse the data two econometric models are constructed using return on assets (ROA) and return on equity (ROE) as proxies for commercial banks’ financial performance as dependent variables and six CAMELS’s key indicators (capital adequacy, asset quality, management efficiency, earning quality, liquidity, and sensitivity to market risk)as independent variables. To determine the extent to which the independent variables have an effect on the dependent variable, panel ordinal least square regression with their assumption has been used. The findings of the study revealed that the financial performance of Indian banking sector as evaluated by ROA and ROE is statistically and significantly affected by capital adequacy, liquidity and sensitivity to market risk, whereas asset quality, managerial efficiency and earning quality is found to have insignificant impact on the financial performance of Indian commercial banks. In order to perform better, it is suggested that the commercial banks should focus more on the variables that have a substantial impact on their financial performance. Keywords: Random effect, ROA, ROE, liquidity, sensitivity to market risk, CAMELS.

STUDY OF RISK MANAGEMENT IN BANKING SECTOR

When it comes to the change of an economy, the function that financial institutions of a country perform is absolutely essential. The financial performance of a bank over the course of its history, as well as its capacity to manage risks such as market risk, credit risk, and liquidity risk, can be used to evaluate the progress that banking institutions have made. In the 1980s, the United States of America first implemented a supervisory framework model known as "CAMEL" in order to ascertain the overall state of the bank. It is possible for the model to serve as an efficient instrument for guidance and management, as it is able to forecast future risks that may have an impact on a bank. The purpose of this study is to evaluate the performance of three "public sector banks" and three "private sector banks" in India using the CAMEL methodology for a period of two years, specifically 2022 and 2023. A bank's financial strength is determined using the CAMEL model, which rates the banks from best to worst based on characteristics such as "capital adequacy, asset quality, management efficiency, earning, and liquidity." characteristics such as these are used to determine the strength of a bank. According to the findings of the study, the State Bank of India, the Central Bank of India, and the IDBI bank are the three banks that perform the best in terms of the CAMEL parameters among public sector banks. Similarly, according to the CAMEL composite index rating, the private sector banks in India that hold the top ranks are ICICI bank, Kotak Mahindra Bank, and HDFC bank. Key Word : CAMEL model evaluates financial health of banks using capital, asset quality, management, earnings, and liquidity.

A Research Project on: “A Study on Credit Facilities by Private Sector Banks in India”

This study investigates the landscape of credit facilities offered by private sector banks in India, examining the dynamics of lending practices, the impact of regulatory frameworks, and the role of technological advancements in shaping credit accessibility. A comprehensive analysis is conducted on the types of credit products offered, the risk management strategies employed by banks, and the effectiveness of credit evaluation processes. The study also delves into the factors influencing borrowers' choices and satisfaction levels with private sector banks. Methodologically, a combination of qualitative and quantitative research approaches is employed, utilizing surveys, interviews, and financial data analysis. The findings aim to contribute valuable insights to policymakers, financial institutions, and researchers interested in understanding the intricacies of credit facilities in the Indian banking sector. The study holds significance in the context of economic development, financial inclusion, and the overall stability of the banking industry. (Vidani,2015) Credit facilities, private sector banks, lending practices, risk management, regulatory frameworks, technological advancements, financial inclusion, economic development. Remember to replace the generic terms with the specific details of your study. Additionally, for citations, make sure to refer to the relevant academic journals, books, or other authoritative sources that contribute to your study. (Vidani & Solanki,2015)

IMPACT OF NPA (NON-PERFORMING ASSETS) ON THE PROFITABILITY PERFORMANCE OF THE SELECTED PUBLIC AND PRIVATE SECTOR BANK

The banking sectors performance is crucial for any economy as it reflects the countrys financial health. Banks play a crucial role in mobilising funds from various sectors of the economy, including both priority and non-priority sectors, to finance diverse economic activities.For many years, the banking industry has faced significant challenges due to unrecovered loans.The presence of Non-Performing Assets (NPAs) has significantly hindered the development and growth of the economy.This study delves into the impact of NPAs on the profitability performance of selected public and private sector banks in India from 2018-19 to 2022-23. Analysing key ratios like Gross NPA, Net NPA, and Return on Assets (ROA), sheds light on the relationship between NPAs and bank performance. The findings highlight higher NPA levels in public sector banks, adversely affecting their profitability. Moreover, a significant correlation between NPAs and profitability underscores the imperative of effective NPA management for enhancing bank profitability. These insights are crucial for bank management, policymakers, and regulators to devise strategies for mitigating NPAs and fortifying the banking sector.

Financial Analysis Axis Bank

Financial Analysis Axis Bank

Big Data Analytics: Analyzing the Significance of it in Light to Indian Banking Sector

Abstract: Banks are the engines that drive the financial sector, monetary markets, and economic expansion. Since the introduction of information technology (IT) in the 1980s, 1990s, and 2000s, the Indian banking sector has experienced a number of changes in terms of how IT is applied to various banking operations from different perspectives, such as cutting expenses, earning revenue, detection of fraud, security concerns, etc. These changes are still ongoing with the emergence of new trends like business intelligence and big data analytics. Banks are utilizing big data to their advantage. To obtain a general competitive edge, they push for innovations in data and analytics through the use of big data and data science. Due to the vast amount of data about transactions that banks collect, big data has the ability to completely change business operations and procedures. Big Data analytics is the answer to the current banking environment's challenges of growing competitiveness, fraud, and cyber security risks.

A Study on Cyber Frauds Post Digitalization in India

Abstract: In the modern era of Digitalization, Digital banking has become more relevant due to the latest demonetization happened in India. The digitization of banking has made financial transactions swift and brought luxurious banking from anywhere, anytime. Indian government is not only encouraging using the cashless transactions but also providing financial benefits on digital transactions. As the usage of digital banking transactions increased, it introduced differenttypes of cyber frauds and the rate of fraudulent practices also got amplified, therefore sound knowledge of usage of digitalisation services is requisite to prevent fraudulent practices. The present study depicts the types of frauds happening post digitalization in banking Industry and also tries to figure out the different reasons responsible for the happening of frauds in the IndianBanking Sector.

Operational efficiency in the presence of undesirable byproducts: an analysis of Indian banking sector under traditional and market-based banking framework

PurposeIn the backdrop of an increase in market-based banking activities, this paper aims to study operational efficiency of Indian banking sector during 2009–2010 through 2017–2018 considering Capital Gain and Gain from Forex Market (as desirable outputs) and Slippage (as undesirable byproducts) simultaneously, along with Advances – a desirable output considered in the traditional banking performance assessment literature. This enables to have an assessment of performance (as captured by the measured efficiency scores) of Indian Banks following an alternative viewpoint about the banking activities. The authors also explain such efficiency scores in terms of bank-specific factors, banking industry competition scenario and interest rate channel.Design/methodology/approachUsing data envelopment analysis (DEA) method, the authors estimate six alternatives but interlinked operational efficiency scores (TES) of the Indian domestic commercial banks. In the second stage, they explain such TES in terms of bank-specific factors, banking industry competition scenario and interest rate channel.FindingsThe authors observe that the private sector banks as a group outperform those under public ownership. Moreover, although the private sector banks could maintain somewhat consistency in their operational efficiency performance over the sample period, public sector banks clearly show a declining tendency. The second stage econometric estimation results show that the priority sector lending has a negative effect on efficiency. Interestingly, the authors get varying results for the relationship between maturity and efficiency score depending on banks’ strategies on stressed assets management. Furthermore, the analyses result that banks are not so efficient in managing relatively larger-volume loans. It is also observed that banks’ efficiency positively depends on the Credit-to-Deposit (CD) ratio. It is found that the overall operational efficiency of the banks to manage their credit risk portfolio improves with a reduction in the lending rate (LR). However, the interaction of lending activities and capital market shows that with the increase in LR, corporate borrowers may switch to capital market to explore for desired funds, which may induce the banking sector to investment in capital markets and create a positive market sentiment.Originality/valueLiterature, although scanty, is there dealing stressed assets of a bank as some undesirable byproducts of its operational and business activities. However, such literature mostly done within the traditional framework of banking business activities and modern market-based business activities are almost absent in the literature. The authors have done it in the present study.