A Study of Non-Performing Assets (NPAS) on Indian Public Sector Banks

Mr. GIRI. V MBA
SAKTHI INSTITUTE OF INFORMATION AND MANAGEMENT STUDIES

ABSTRACT

Non-Performing Assets (NPAs) remain a pivotal concern for the stability and growth of the Indian banking sector. This study examines NPA trends and financial performance of ten selected Indian Public Sector Banks — SBI, Bank of Baroda, Union Bank of India, Punjab National Bank, Canara Bank, Indian Bank, Bank of India, Indian Overseas Bank, Bank of Maharashtra, and Central Bank of India — over a five-year period from 2021 to 2025. Using six key financial ratios (Gross NPA Ratio, Net NPA Ratio, Provision Coverage Ratio, Credit Deposit Ratio, Return on Assets, and Capital Adequacy Ratio) along with descriptive statistics (mean and standard deviation), the study finds a consistent and significant improvement in asset quality across all banks. Bank of Maharashtra and Indian Bank emerged as top performers, while SBI demonstrated the most stable performance. The findings suggest that regulatory reforms, proactive credit management, and technology-driven recovery mechanisms have collectively contributed to the notable decline in NPA levels.

Keywords: Non-Performing Assets, Gross NPA, Net NPA, Provision Coverage Ratio, Capital Adequacy Ratio, Return on Assets, Public Sector Banks, Indian Banking Sector