Dimensions of non-performing assets in urban co-operative banks (UCBS) - An analytical study with reference to UCBS in Chittoor district of Andhra Pradesh

Co-operative credit societies were set up in India towards the close of 19^th century. Since their inception, the UCBs have been playing an important role in the socio-economic development of the country by making available institutional credit at affordable cost, particularly in the urban and semi-urban areas. Urban Co-operative Banks functioning with the twin objectives of co-operation and banking. The globalization era has opened the gates for many banking units both in public and private sectors, which in turn pose a great threat to the very spirit and performance of the UCBs. As the UCBs are bogged down by the burden of the NPAs. The NPAs badly affect the financial discipline of the UCBs. The present study intends to focus on the overall scenario of the NPAs in UCBs at the national and state levels in general and the Chittoor district level in particular. The percentage of NPAs to total advances of UCBs in India was reduced from 16.1 per cent to 10.1 per cent, whereas NPAs percentage of UCBs in Andhra Pradesh rose from 1.3 per cent to 9.1 per cent for the study period. The average NPAs percentage of six UCBs in Chittoor district also increased from 14.21 per cent to 21.77 per cent in the study period. The study is carried out for the period of 10 years i.e. 2000–01 to 2009–10, based on information provided by the banks in their published annual reports. Based on the study the feasible measurers are suggested to overcome the menace of the NPAs.