NPA and Select Key Financial Heads: an Empirical study of Commercial Banks of India using Multiple Regression Modelling

Prerna Bamoriya and Rajendra Jain
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Prerna Bamoriya: Govindram Seksaria Institute of Management & Research, India
Rajendra Jain: Govindram Seksaria Institute of Management & Research, India

The Journal of Accounting and Management, 2013, issue 2, 19-25

Abstract: Non Performing Assets (NPAs) is one of the critical problems that have shaken the banking sector in India. There are many studies on internal and external factors affecting NPAs level, but this study attempts to specifically analyze impact of Key Financial Heads on NPA of Scheduled Commercial Banks of India to suggest banks on effective management of NPAs. For this Multiple Regression Modeling was used. Secondary data was taken from four representative banks for a period of 10 years starting from year 2002-03 to 2012-13. Among Key Financial Heads, Total Assets and Total Deposits had significant impact of NPA level. Further, Total Deposits was found to be contributing most to the NPA level. Banking sector is an indispensable financial service sector where threat of increase in NPAs affects the liquidity and profitability of banks. Thus this study made important implications to banks on effective management of NPAs.

Keywords: Non-performing loans; Total Assets; Total Advances; Total Deposits; Net Interest Income. (search for similar items in EconPapers)
Date: 2013
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