Management of non-performing assets of nationalised commercial banks in Bihar with special reference to Punjab National Bank
Dimpal Saraswat, Ajit Kumar Singh
The Banks being the mobiliser of finances for the different sectors of economy and are expected to be strong enough to withstand the shocks like inflation, deflation etc. and to cushion the other financial Institutions along with industries and common people against financial crisis. NPA is the best indicator for the health of the banking industry but in India Non-performing assets are one of the major concerns for banks. NPAs are the primary indicators of credit risk and it is the inevitable burden on the banking industry. Hence, the success of a bank depends upon methods of managing NPAs. The Public Sector Banks have shown very good performance wherever the financial operations are concerned. However, the only problem of the Nationalised Commercial Banks these days are the increasing level of the non-performing assets. The non-performing assets of the Public-Sector Banks have been increasing regularly year by year and the performance of banks Increasing Non-performing Asset (NPA) at an alarming rate which is a threat to the banking industry sending distressing signals on the sustainability of the affected banks. When PNB Gross & NET NPA compared with total advances we get the result that there is mismanagement on the side of PNB. While analysing the impact of NPA level on PNB we derived the conclusion that there is a positive relation between Net Profits and NPA of PNB. It simply means that as profits increase NPA also increase. It is because of the mismanagement on the side of bank. Several prudential and provisioning norms have been introduced, and these are pressurizing banks to improve efficiency and trim down NPAs to improve the financial health in the banking system. In this paper, an effort has been made to understanding the concept of NPAs, its magnitude and major causes for increasing NPA & also to evaluate the operational performance of Punjab National Bank.
Dimpal Saraswat, Ajit Kumar Singh. Management of non-performing assets of nationalised commercial banks in Bihar with special reference to Punjab National Bank. International Journal of Management and Commerce, Volume 4, Issue 1, 2022, Pages 14-17