Author(s) :   Kanwal Jeet

Abstract : This study delves into the relationship between external factors and Non-Performing Assets (NPAs) in public sector banks in India. A robust financial system plays a crucial role in poverty alleviation and enhancing living standards. However, the emergence of NPAs poses a significant challenge to the banking sector's stability and performance. Through a comprehensive review of literature, various macroeconomic and bank-specific factors influencing NPAs are identified. The research methodology combines exploratory and descriptive approaches, utilizing secondary data from prominent public sector banks over a ten-year period. Multiple regression analysis is employed to quantify the influence of external determinants such as GDP, inflation, and industrial production on NPAs. The findings reveal significant relationships between GDP and NPAs, emphasizing the importance of economic growth in mitigating NPAs. However, inflation and industrial production show insignificant impacts on NPAs. Overall, the study provides valuable insights for policymakers and stakeholders in formulating effective strategies to address NPAs and strengthen the resilience of the banking sector.

Keywords: Non-Performing Assets (NPAs), GDP, Inflation, Industrial Production etc.

DOI : 10.61161/ijarcsms.v11i8.12

Pages : 45-49

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