UNVEILING FINANCIAL TRENDS: A TIME SERIES ANALYSIS OF SELECTED INDIAN BANKS

Abstract

The prevailing concern within the banking industry revolves around non-performing assets (NPAs), representing a significant obstacle to operational efficiency and financial stability. NPAs exert adverse impacts on banks' performance metrics, manifesting as diminished earnings, reduced investable funds, and deterioration in overall financial health. Their presence serves as a barometer for evaluating the efficacy of the banking sector, reflecting challenges in asset quality management and loan recovery mechanisms. Non-performing assets encompass assets that fail to generate returns within a predetermined timeframe, thereby posing a risk to banks' profitability and solvency. The prevalence of defaulted loans and instances of substantial fraud has precipitated a critical impasse within the public banking sector, exacerbating the NPA conundrum. The emergence of the COVID-19 pandemic's second wave exacerbated the situation, resulting in a notable surge in stressed assets and heightened concerns regarding borrower repayment capabilities across diverse sectors. Against this backdrop, this study delves into the examination of non-performing assets held by select Indian private sector banks. By scrutinizing the dynamics surrounding NPAs within this subset of banks, the research aims to shed light on the intricacies of NPA management practices, regulatory compliance, and the efficacy of risk mitigation strategies. Through a comprehensive analysis, the study endeavours to offer insights into potential pathways for addressing the NPA crisis and fortifying the resilience of the banking sector against future shocks and uncertainties.