Non-Performing Assets of Commercial Banks: A Case Study

Abstract

Non-Performing Assets (NPAs) in the Indian banking system have assumed astronomical dimensions through the introduction of the concept of asset classification, income recognition and provisioning norms by Reserve Bank of India to assess the credit risk of a bank. High level of NPAs in banks has attracted public as well as foreign financial institutions to analyze the reasons for it. In this paper, an attempt has been made to find out the various factors responsible for the huge NPAs. Further, the different characteristics of NPAs on the basis of industry and area (i.e., state-wise as well as region-wise) have been analyzed.