NPA in Banking Sector: Some Correlational Evidence

Nonperforming assets indicate the credit risk of the banks. Operational efficiency of the banks is affected by the quality of advances which in turn has an impact on the profitability, liquidity and solvency position of the banks. This paper deals with the comparative analysis of advances and non performing assets in public and private sector banks using statistical tools like correlation analysis. This study mainly attempts to chalk out the relationship between advances and non performing assets in the light of mounting competitive scenario in the banking sector.