Main Article Content
Abstract
The role of public sector banks in India is very important as they are the financial institutions involved in priority sector lending as per the directive of the Government. The stakeholders (depositors and investors) of the banks could feel comfortable only if the banks are healthy. However, the healthiness of the banks is associated with their credit management because their major portion of assets formed by lending which generate huge interest income determining the financial performance of the banks. However, some of these loans usually fall into non-performing status and adversely affect banks’ performance. So, the area of loan defaults i.e. non-performing assets requires continued in-depth research to avoid distresses in economic and financial system which is trusted by millions of individuals and business concerns. This research work will be a source for policy makers, other researchers and banking professionals to understand, control and to reduce the cancer of increasing non-performing assets from the economy. As the role played by the banks in the performance of India’s economy is critical, it is felt essential to identify problems that affect the performance of these institutions. This is because these non-performing assets can affect the banks’ ability to play their role in the development of the economy. In the light above, the present study is important as it can contribute to the existing works on NPAs and build up academic knowledge in various issues pertaining to NPAs. Further, this study would enable the management of the banks to come out with pragmatic loan recovery policies to reduce the NPAs.