IDEAS home Printed from https://ideas.repec.org/h/pal/pmschp/978-3-319-55663-5_7.html
   My bibliography  Save this book chapter

Non-performing Assets

In: Banking Reforms in India

Author

Listed:
  • T. R. Bishnoi

    (The Maharaja Sayajirao University of Baroda)

  • Sofia Devi

    (The Maharaja Sayajirao University of Baroda)

Abstract

Recent rising trend of non-performing assets (NPAs) has become a major concern for banks and RBI both because of its inherent risk of weakening financial system. Effective management of NPAs is essential for preserving the economic value of banks and economic stability. Along with sliding domestic growth during 2009–2012, the banking sector also witnessed a slowdown in its overall performancePerformance associated with rising NPAs. Whether or not slowdown in economic growth was associated with higher level of NPAs of banks? Were NPAs result of asymmetric information problemAsymmetric information problem moral hazard of banks? Empirical analysis showed that there was a statistically significant negative correlationCorrelation between NPAs and real GDP growth rate for each bank group. This supports the hypothesis that higher NPAs of banks were due to slowdown in real domestic economic growth. However, there may be macroeconomic shocks or asymmetric information problemAsymmetric information problem moral hazard of the banks that affects the level of NPAs in some cases.

Suggested Citation

  • T. R. Bishnoi & Sofia Devi, 2017. "Non-performing Assets," Palgrave Macmillan Studies in Banking and Financial Institutions, in: Banking Reforms in India, chapter 0, pages 187-209, Palgrave Macmillan.
    • Handle: RePEc:pal:pmschp:978-3-319-55663-5_7
    DOI: 10.1007/978-3-319-55663-5_7
    as

    Download full text from publisher

    To our knowledge, this item is not available for download. To find whether it is available, there are three options:
    1. Check below whether another version of this item is available online.
    2. Check on the provider's web page whether it is in fact available.
    3. Perform a search for a similarly titled item that would be available.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:pal:pmschp:978-3-319-55663-5_7. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Sonal Shukla or Springer Nature Abstracting and Indexing (email available below). General contact details of provider: http://www.palgrave.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.