IJSSER

Title: A Study on Determinants of Non-Performing Assets in Indian Banks
Authors: Swathi M P and Dr. Mahesha M
\|\| \|\|
Swathi M P1 and Dr. Mahesha M2 1. Research Scholar, Department of studies in Economics and Cooperation, University of Mysuru, Manasagangothri, Mysuru, Karnataka, India-570006 2. Professor of Economics, Department of studies in Economics and Cooperation, University of Mysuru, Manasagangothri, Mysuru, Karnataka, India-570006
MLA 8 M P, Swathi, and Dr. Mahesha M. "A Study on Determinants of Non-Performing Assets in Indian Banks." Int. j. of Social Science and Economic Research, vol. 9, no. 5, May 2024, pp. 1393-1401, doi.org/10.46609/IJSSER.2024.v09i05.003. Accessed May 2024. APA 6 M P, S., & M, D. (2024, May). A Study on Determinants of Non-Performing Assets in Indian Banks. Int. j. of Social Science and Economic Research, 9(5), 1393-1401. Retrieved from https://doi.org/10.46609/IJSSER.2024.v09i05.003 Chicago M P, Swathi, and Dr. Mahesha M. "A Study on Determinants of Non-Performing Assets in Indian Banks." Int. j. of Social Science and Economic Research 9, no. 5 (May 2024), 1393-1401. Accessed May, 2024. https://doi.org/10.46609/IJSSER.2024.v09i05.003.
References [1]. Bardhan and Mukherjee(2016) ‘Bank-specific Determinants of Non-performing assets of Indian banks’, Int econ Econ Policy , Vol.13, PP.483-498. [2]. Bardhan and Mukherjee(2013), ‘Willful Deafault in Developing Country Banking System: A Theoretical Exercise’, Journal of Economic Development, 38(4), pp 101-122. [3]. Das S K(2021), ‘What Explains NPAs in Indian Banks?, ISID Working paper-235. [4]. Dhar S. and Bhakshi A.(2015), ‘Determinants of loan losses of Indian Banks:A Panel Study’, Journal of Asia Business Studies, Vol.9, No.1, pp 17-32. [5]. Ghosh(2014), ‘Asset quality of Banks: Evidence from India’ [6]. Koju et al.,(2018) ‘Macroeconomic and Bank Specific Determinants of Non-Performing Loans: Evidence from Nepalese Banking System’, Journal of central Banking Theory and Practices, 3, PP.111-138. [7]. Lee and Rosenhranz(2019) ‘Non-Performing Assets in Asia:Determinants and Macrofinancial Linkages’, ADB Economics Working Paper. [8]. Louzis et al.(2012), ‘Macroeconomic and Bank-specific Determinants of Non-Performing Loans in Greece: A Comparative Study of Mortagage, Business and Consumer Loan Portfolios’, J Bank Financ, 36(4), pp. 1012-1027. [9]. Makri V. Tsangkanas A. and Bellas A.(2014), Deetrminants of Non-Performing Loans: The Case of Eurozone’, Panoeconomics, 61, pp 193-206. [10]. Roy(2014), ‘Determinants of Non-Performing Assets in India - Panel Regression’ Eurasian Journal of Economics and Finance, 2(3), 2014, pp 69-78
ABSTRACT: The purpose of this paper is to empirically examine the effect of macroeconomic determinants on non-performing assets (NPAs) in the India’s commercial banks using a panel regression model. This study considers all public, private, and foreign sector scheduled commercial banks during a period of seventeen years from 2004-05 to 2021-22, and uses four macroeconomic variables-GDP growth rate, inflation rate, interest rate and global volatility index- to assess the impact of these variables on NPAs. The findings show that NPAs have a negative relationship with GDP growth rate, confirming a increase in economic growth would rise the incomes of people and businesses and improve the ability of repayment of loans to the banks. Remaining three macroeconomic determinants negatively associated with NPAs but they were statistically insignificant. The result of the empirical study suggests that efficient management policies at the macro level are required to reduce the level of NPAs and to maintain the stability of the performance of banks in India.

IJSSER is Member of