Npa Literature Review

1.1 REVIEW OF LITERATURE:

So far we have discussed in brief about the concepts of the study. The concepts covered are banking system in India, Public sector banks, Non-Performing Assets (NPAs), its impact on the performance of the public sector banks and other related aspects. Our study is related to the impact of non-performing assets on the performance of the public sector banks. Regarding this topic and related topics earlier many researchers have conducted the studies. The studies are being published in reputed books, journals and magazines. Thus, in the context we felt the need of study the available literature. Such literature is useful to start and complete our research in a systematic and scientific way. Therefore, the findings and

Vivek Rajbahadur Singh (2016) stated that the Non-Performing Assets have always created a big problem for the banks in India. This problem is not just hurting the banks financial performance but also hurting the Indian economy. The money locked up in NPAs has a direct impact on profitability of the bank as the banks are highly dependent on income from interest on funds lent. This study shows that extent of NPA is comparatively very high in public sectors banks. Although various steps have been taken by government to reduce the NPAs but still a lot needs to be done to curb this problem. The NPAs level of Indian banks is still high as compared to the foreign banks. In order to reduce the NPAs, the bank management should speed up the recovery process. The government should also make more provisions for faster settlement of pending cases and also it should reduce the mandatory lending to priority sector as this is the major problem creating area. So the problem of NPA needs lots of serious efforts otherwise NPAs will keep killing the profitability of banks which is not good for the growing Indian economy at

Beatrice John Bernard (2015) in her thesis stated that the problem of NPAs is related to several internal and external factors confronting the borrowers. The internal factors are diversion of funds for expansion, diversification, modernization, taking up new projects, helping/ promoting associate concerns, time/cost overruns during the project implementation stage, business (product, marketing) failure, inefficient management, strained labour relations, inappropriate technology/technical problems, product obsolescence, etc. While the external factors are recession, inflation, inputs/power shortage, price escalation, accidents and natural