NPAs in India's banks: trends and determinants
Purpose – This paper aims to analyse trends and determinants of NPAs in India's banks. It has empirically examined the bank-specific determinants of NPAs. Design/methodology/approach – An FE panel estimation of a sample of 44 banks was carried out for the post-crisis time period, from 2010 to 2...
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| Format: | Article |
| Language: | English |
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Emerald Publishing
2023-12-01
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| Series: | Journal of Money and Business |
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| Online Access: | https://www.emerald.com/insight/content/doi/10.1108/JMB-09-2022-0043/full/pdf |
| _version_ | 1797448186612154368 |
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| author | Santosh Kumar Das |
| author_facet | Santosh Kumar Das |
| author_sort | Santosh Kumar Das |
| collection | DOAJ |
| description | Purpose – This paper aims to analyse trends and determinants of NPAs in India's banks. It has empirically examined the bank-specific determinants of NPAs. Design/methodology/approach – An FE panel estimation of a sample of 44 banks was carried out for the post-crisis time period, from 2010 to 2020 to identify the bank-specific determinants of NPAs. The sample of 44 banks includes 20 PSBs, 19 private banks and 5 foreign banks. Separate FE estimation was also carried out to identify the drivers of NPAs in PSBs. Findings – The determinant of NPAs during the post-crisis period suggests that faulty earning management and deterioration in loan quality have resulted in high NPAs in India's banks. The result is similar for PSBs as well. Research limitations/implications – The findings of the study suggest that the banks, especially the Public Sector Banks (PSBs) need to revisit their earning management strategies to maximise income and improve their loan quality in order to reduce the incidence of loan failure. Originality/value – The paper contributes by empirically analysing the determinants of NPAs during the recent decade, between 2010 and 2020. Separate estimations have been carried out to understand whether the drivers of NPAs differ in the case of PSBs. |
| first_indexed | 2024-03-09T14:06:49Z |
| format | Article |
| id | doaj.art-5c400361b6c04fad8ddbe6c16cb29f5f |
| institution | Directory Open Access Journal |
| issn | 2634-2596 2634-260X |
| language | English |
| last_indexed | 2024-03-09T14:06:49Z |
| publishDate | 2023-12-01 |
| publisher | Emerald Publishing |
| record_format | Article |
| series | Journal of Money and Business |
| spelling | doaj.art-5c400361b6c04fad8ddbe6c16cb29f5f2023-11-30T03:56:13ZengEmerald PublishingJournal of Money and Business2634-25962634-260X2023-12-013214715810.1108/JMB-09-2022-0043NPAs in India's banks: trends and determinantsSantosh Kumar Das0Institute for Studies in Industrial Development, New Delhi, IndiaPurpose – This paper aims to analyse trends and determinants of NPAs in India's banks. It has empirically examined the bank-specific determinants of NPAs. Design/methodology/approach – An FE panel estimation of a sample of 44 banks was carried out for the post-crisis time period, from 2010 to 2020 to identify the bank-specific determinants of NPAs. The sample of 44 banks includes 20 PSBs, 19 private banks and 5 foreign banks. Separate FE estimation was also carried out to identify the drivers of NPAs in PSBs. Findings – The determinant of NPAs during the post-crisis period suggests that faulty earning management and deterioration in loan quality have resulted in high NPAs in India's banks. The result is similar for PSBs as well. Research limitations/implications – The findings of the study suggest that the banks, especially the Public Sector Banks (PSBs) need to revisit their earning management strategies to maximise income and improve their loan quality in order to reduce the incidence of loan failure. Originality/value – The paper contributes by empirically analysing the determinants of NPAs during the recent decade, between 2010 and 2020. Separate estimations have been carried out to understand whether the drivers of NPAs differ in the case of PSBs.https://www.emerald.com/insight/content/doi/10.1108/JMB-09-2022-0043/full/pdfNPAsIndia's banksPSBsLoan failure |
| spellingShingle | Santosh Kumar Das NPAs in India's banks: trends and determinants Journal of Money and Business NPAs India's banks PSBs Loan failure |
| title | NPAs in India's banks: trends and determinants |
| title_full | NPAs in India's banks: trends and determinants |
| title_fullStr | NPAs in India's banks: trends and determinants |
| title_full_unstemmed | NPAs in India's banks: trends and determinants |
| title_short | NPAs in India's banks: trends and determinants |
| title_sort | npas in india s banks trends and determinants |
| topic | NPAs India's banks PSBs Loan failure |
| url | https://www.emerald.com/insight/content/doi/10.1108/JMB-09-2022-0043/full/pdf |
| work_keys_str_mv | AT santoshkumardas npasinindiasbankstrendsanddeterminants |