NPAs
Performance Evaluation of Public Vs Private Sector Banks in India
Monika Hanspal*
V.K Sareen**
The global financial system is still away from full recovery because of slow down of US economy, impact of Euro debt crisis on the Euro countries. Though the Indian banking sector is protected by the central bank still it’s not saved from the impact. Continuous inflation, slow GDP growth, accelerated interest rates, asset quality issues in the banks has declined the investment in the country. For the development of any economy the strong banking sector is always the prerequisite. The effective performance of the banks leads the growth of any economy. In the present study, attempt has been made to measure the efficiency of the banks. For the purpose of study, the top five public sector banks and top five private sector banks operating in India are taken. Their efficiency is tested with the help of CAMEL model. Uniformity in the efficiency and performance is tested with the help of Friedman Rank Test. It is found that the performance of the banks is not uniform over the period from the year 2009 to 2013. The performance of the Public and Private Sector Banks vary on different parameters of CAMEL Model.
Key words : Euro Debt Crisis, Inflation, GDP Growth, Interest rates, Camel Model
Banks are basically service-rendering institutions. The existence and success of banks depend on their ability to meet the various needs and wants of the customers. The new millennium has brought with it challenges as well as opportunities in various fields of economic activities including banking. The banking sector in India has undergone several changes in the areas of prudential, regulatory, disclosure and supervisory norms. The financial reforms launched during the early 1990s have dramatically changed the banking scenario in the country. New prudential norms, capital adequacy prescriptions, identification of bad debts, provision requirements etc. were
Monika Hanspal*
V.K Sareen**
The global financial system is still away from full recovery because of slow down of US economy, impact of Euro debt crisis on the Euro countries. Though the Indian banking sector is protected by the central bank still it’s not saved from the impact. Continuous inflation, slow GDP growth, accelerated interest rates, asset quality issues in the banks has declined the investment in the country. For the development of any economy the strong banking sector is always the prerequisite. The effective performance of the banks leads the growth of any economy. In the present study, attempt has been made to measure the efficiency of the banks. For the purpose of study, the top five public sector banks and top five private sector banks operating in India are taken. Their efficiency is tested with the help of CAMEL model. Uniformity in the efficiency and performance is tested with the help of Friedman Rank Test. It is found that the performance of the banks is not uniform over the period from the year 2009 to 2013. The performance of the Public and Private Sector Banks vary on different parameters of CAMEL Model.
Key words : Euro Debt Crisis, Inflation, GDP Growth, Interest rates, Camel Model
Banks are basically service-rendering institutions. The existence and success of banks depend on their ability to meet the various needs and wants of the customers. The new millennium has brought with it challenges as well as opportunities in various fields of economic activities including banking. The banking sector in India has undergone several changes in the areas of prudential, regulatory, disclosure and supervisory norms. The financial reforms launched during the early 1990s have dramatically changed the banking scenario in the country. New prudential norms, capital adequacy prescriptions, identification of bad debts, provision requirements etc. were
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