An Effectiveness Assessment of Preventive Management Strategies in Order to Manage Non Performing Assets in Indian Banks: A Case Study

Scientific Annals of Economics and Business, 67 (2), 235-258, 2020

Posted: 13 Jul 2020

See all articles by Bharat Kumar Meher

Bharat Kumar Meher

Department of Commerce, Manipal Academy of Higher Education, Karnataka, India

G. L. Puntambekar

affiliation not provided to SSRN

Iqbal Thonse Hawaldar

Kingdom University

Cristi Marcel Spulbar

University of Craiova - Faculty of Economics and Business Administration

Felicia Ramona Birau

University of Craiova - Faculty of Social Science

Christian Rebegea

affiliation not provided to SSRN

Date Written: June 30, 2020

Abstract

There are two kinds of strategies to control Non Performing Assets i.e. curative and preventive. The paper is an attempt to focus on the effectiveness of various preventive strategies in controlling NPA in future. For this study primary data have been collected from 82 branches out of 138 branches of Sagar District in Madhya Pradesh of India. The respondents are the branch managers or recovery officer of each branch. The primary data are related to the causes of NPA, actual usage of preventive measures and effectiveness of each preventive strategy. It highlights few new causes which are barely covered by the earlier researches. The study also represents the actual usage of various preventive measures along with the effectiveness of preventive measures in averting NPA to be occurred in future. The outcome of this study could provide a valuable insight about which strategy is more effective to prevent these stressed assets. Besides that, it could aware the banking authorities regarding the problems faced by the managers in using the preventive measure.

Keywords: Non-Performing Assets (NPA), Preventive Management Strategies, Non-Parametric Tests, Early Warning Signals (EWS), Demonstration Effect on NPA, Indian banks

JEL Classification: G21; G23, G24

Suggested Citation

Meher, Bharat Kumar and Puntambekar, G. L. and Hawaldar, Iqbal Thonse and Spulbar, Cristi Marcel and Birau, Felicia Ramona and Rebegea, Christian, An Effectiveness Assessment of Preventive Management Strategies in Order to Manage Non Performing Assets in Indian Banks: A Case Study (June 30, 2020). Scientific Annals of Economics and Business, 67 (2), 235-258, 2020, Available at SSRN: https://ssrn.com/abstract=3642876

Bharat Kumar Meher

Department of Commerce, Manipal Academy of Higher Education, Karnataka, India ( email )

Tiger Circle Road, Madhav Nagar, Manipal, Karnatak
Udupi, 576104
India
9853340710 (Phone)

G. L. Puntambekar

affiliation not provided to SSRN

Iqbal Thonse Hawaldar (Contact Author)

Kingdom University ( email )

Sanad
Bahrain

Cristi Marcel Spulbar

University of Craiova - Faculty of Economics and Business Administration

Craiova
Romania

Felicia Ramona Birau

University of Craiova - Faculty of Social Science ( email )

Romania

Christian Rebegea

affiliation not provided to SSRN

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