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REPORT
ONA COMPARITIVE STUDY OF ADVANCE AND NON
PERFORMING ASSETS OF PUBLIC AND PRIVATE SECTOR
BANKS
WITH SPECIAL REFERENCE TO INDIAN OVERSEAS BANK
AND INDUSTRIAL CREDIT AND INVESTMENT CORPORATION
OF INDIA
Submitted to:Kurukshetra University, Kurukshetra
(Session 2006-2008)
Under the supervision of:- Submitted By:-
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\Acknowledgment
This project report has been made possible through the direct & indirect co-
operation of various people whom I wish to express my thanks and
gratitude.First and foremost I am very thankful to Dr. D.D.Arora
(Head of Department, KUK) for helping me to do work on project.
I also wish to express sincere thanks to Dr. (Director
Tilak Raj Chadha Institute of Management & technology, Yamunanagar.)
I would also like to thanks the Mrs Monika Chawla faculty member
of the institute and my friends for their advice and guidance along kindled
inspiration in the face of difficulties encountered in the course of this work
and to create this project report.
Finally with blessings of my parents and who had been a source
of strength and inspiration for me in this endeavor.
( )
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CONTENTS
o INTRODUCTION.
PROFILE OF THE STUDY.
SIGNIFICANCE OF THE STUDY.
o OBJECTIVES OF THE STUDY.
o LITERATURE REVIEW.
o RESEARCH METHODOLOGY.
SAMPLING AND SAMPLING DESIGN
ANALYTICAL TOOL
DATA COLLECTION.
HYPOTHESIS TESTING
LIMITATIONS OF THE STUDY.
o RESULTS & FINDINGS
o RECOMMENDATIONS
o BIBLIOGRAPHY
o ANNEXXURE
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INTRODUCTION OF THE
STUDY
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INTRODUCTION:
The Indian banking can be broadly categorized into nationalized
banks (Government owned) private banks, foreign banks and development
banks. But now a days Indian banking sector is the availability of quality
assets. The most glaring culprit affecting the banks profitability is what is
known as Non performing assets(NPAs). According to economist, Omkar
Goswani, The biggest threat in the event of capital account convertibility
comes from the fact that high NPAs have made Indian public sector banks
non competitive vis--vis their foreign counter parts.
Any financial lending has the inherent risk of default. The default in
paying date is categorized as NPAs. With a view to enhance operational
efficiency, productivity, profitability and with the objective of implementing
international best practices in Indian banks especially with regard to revenue
recognition, assets classification, provisioning and capital adequacy ,
Reserve Bank Of India had introduced a new set of prudential norms during
the year 1992, in the wake of new economic reforms for banks as prescribed
by the first report of Narsimham committee. These norms, implemented in
the phased manner, have gradually become stricter and stricter. They
brought the much desire changes in the profitability performance as well as
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its evaluation in banks, presently any borrower account is treated as non
performing if either interest or principal is not serviced for six months.
In the year of implementation for these norms, most of the public
sectors banks reported substantial losses. As against a total profit of Rs. 558
crore in 1991-92, public sector banks recorded losses, Rs 3650 crore in the
year 1992-93, Rs 4349 crore in year 1993-94, and Rs 3095 crore in year
1994-95. The gross non performing assets (NPAs) of the public sector banks
increased to Rs 54773 crore on march 2001 from Rs 53033 crore on march
2000 and of the private sector banks from Rs 4761 crore to Rs 6030 and
foreign banks from Rs 2614 crore to Rs 3071 crore as on march 2001.
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MEANING OF NPAs:
Indian banks have for a long time treated all the sticky loan assets as
NPAs. The actual concept of accounting conventions has been followed
without reckoning the amount actually realized. It mean that if a loan given
by a bank fails to fetch a return in the forms of interest realized from the
borrower the banks has no right to debit the borrowers account with the
interest chargeable following the accrual principal. An assets which causes
to yield income for the bank should be treated as NPA, and income from
loan assets should not be booked as income until it is actually recovered.
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CLASSFICATION OF ASSETS UNDER
NON PERFORMING ASSETS:
In line with the RBI guideline from time to time, the loans given by banks
are classified as performing and non performing for the purpose of income
recognition and provisioning. Indian banking sector can classify its assets
under NPAs in four broad categories.
a) Standard assets/ performing assets.
b) Sub- standard assets.
c) Doubtful assets.
d) Loss assets.
A) Standard assets / performing assests:
Standard assets are those assets which doesnot disclose any problem
and which does not carry more than normal risk which attached to the bank
such as assets is not a non-performing such as assets is not a non-performing
assets loans where installments become due but not received with in a period
of one year should not be classified as a standard assets. Loans assets in
respects of which interest and principal are received regularly are called
standard or performing assets. Standard assets also includes loans where
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arrears of interest and/or of principal do not exceed 180 days at the ends of
financial year no provision required for such loans.
B Sub-standard assets:
Sub standard assets are those which are non-performing for a
period not exceeding two years. Eg an assets which has been treated
as non- performing assets as on 31st march 1999 would be treated as
non performing assets upto 31st march 2000. In case of term loan
those where installments of principals are overdue for a period
exceeding one year but not exceeding two years should be treated as
sub- standard assets. An assets where the term of the loan agreement
regarding interest and principal have been renegotiated or reschedule
after six months of commencement of production a part of
rehabilitation package. Approved by the institution should be
classified as sub standard and should remain in such category for at
least two years of satisfactory performance under renegotiated or
rescheduled terms. Also in cases where the loan repayment is
rescheduled. RBI has asked to banks to recognize the loans as sub-
standard at least for one year.
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C). Doubtful assets:
Doubtful assets are those loans which have remained non-performing
for a period exceeding two years and which are not considered as loss assets
eg. Credit facility to a borrower which is treated as NPAs on 30th April 1992,
would be treated as doubtful from 1 may 1994. In case of term loan those
where installments of principal have remained overdue for a period
exceeding two years should be treated as doubtful assets. A major portion of
assets under this category relate to sick companies referred to the board for
industrial and financial reconstruction.
D) Loss assets:
A loss asset is one where loss has been identified by the banks but the
amount has not been written off wholly or partly. In other words, such as
assets is considered uncollectible. There may be some salvage value. All the
recalled loans may not be immediately classified as loss assets. Such loans
or assets may be treated as doubtful till a firm decision to pork to recover the
dues is taken up to two years from the date of recall notice and there after
may be classified as loss assets.
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NPAs AS PER RBI GUIDELINES:
According to RBI guideline NPAs are classified in three categories.
A). Cash credit/ overdraft.
B). Term Loans.
C). Bills discounted
A). Cash Credit/overdraft:
When an account is out of order for any two quarters out of fourquarters of the year ending 31st march, the account will be treated as an
NPAs.
B). Term Loan:
If interest/ installments of principal remain unpaid for any two
quarter of the year ending 31st
March, the account will be treated as anNPAs.
C). Bill discounted:
The bills purchased will become NPA if they remain overdue andunpaid for two quarters at end of accounting year is an on 31st March.
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REASONS FOR NON PERFORMING ASSESTS:
At present , any borrowed account not serviced for either interest of
principal for at least 6 months after the specify time period will be called as
non-performing assets. Behind these NPAs have some reasons. Following
are the major reasons for borrower accounting turning out eventually into
non-performingassets.
1. Funds borrowed for a particular purpose but not used for the saidpurpose.
2. Poor recovery of receivables.
3. Inability of the corporate to raise capital through the issue of equityor other debt instrument from capital market.
4. Business failure.
5. Non availability, inadequacy of infrastructure facilities relevant tobackward areas like:
a). Inadequate capacity of substation.
b) Lengthy transmission lines
c) Lock of rail
d) Equipment being kept ideal or sold.
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EFFECTS OF NPAs AT MACRO LEVEL:
The general economic condition of a country can gauged by the
percentage of the total NPAs. Higher the NPA lower the economic
growth. NPAs have both quantitative ill effect on the economy.
Declining Fresh Credit For New Projects:
When the loans taken are not repaid so much of funds has gone
out of the financial system and the cycle of lending repaying borrowing is
broken. The banks also has to repay its depositors and others from whom
money has been borrowed. If the borrower does not pay, the banks has to
borrow additional funds to repay the depositors and creditors. This leads to a
situation where banks are reluctant to lend fresh funds to new projects of on
going projects thus choking the system. Once the credit to various sectors of
the economy slows down, the economy is badly hurt as we are witnessing
now. There is slow GDP industrial output and fall in the consequent
depression in the market.
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Declining Interest Income:
It is common knowledge that PSBs are the largest lenders and
correspondingly the largest earners of interest income at least theoretically.
Public sector banks account for more than 90% of the lending. The
government being sole shareholder of the banks, any dividend declared
would have gone to the government offers and which can be spend on
welfare and developments programs. Further the income that could have
been generated by the entities availing the bad debts amount in the form of
direct and indirect taxes, and other intangibles like employment generation,
developments of the region also have to be considered while evaluating the
adverse affect of the NPAs.
Liquidity Crunch:
Another damaging impact of NPAs on the economy is the
liquidity crunch. When the borrowers do not pay the banks on time the
bankers lose confidence on the borrowers. Consequently the bankers do not
come forward for further funding proposal be it working capital or viable
expansion / diversification projects. The banks and the institution also tap
the capital market for raising resources and mop up huge sums of money and
drain the markets of invest able funds. This is done though banks are not all
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that inclined to increase the credit to the industry for the fear of increasing
NPA. Added to this the fear of inquiry by vigilance department and other
law enforcing agencies. All this leads to a situation where there are lend able
funds. This is done though banks are not all that inclined to increase the
credit to the industry, for the fear of increasing NPA. Added to this the fear
of inquiry by vigilance department and other law enforcing agencies. All this
leads to a situation where there are lend able resources but no lending is
made and the entire economic system is chocked with funds shortage which
leads to liquidity crunch.
Rising fiscal deficit:
When capital support is given to any PSB on account of losses
booked any/or erosion of capital due to NPAs it comes out of either
government budgetary resources of from a public, as per the new
liberalization policy. Whether this money is from tax revenues or from the
hard earned savings of the investing public , in either the society is bearing
the cost of there NPA,s.
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Willful default of loans:
The recovery climate has been vitiated by political
indiscretions, epically with regard to the rural credit. During the
1990s and 1991 there was a massive waiver of rural debt
mounting to over Rs 15000 crore. This unimaginative exercise has
put a premium on willful default and dishonesty. It has lowered the
repayment ethics and even now rural sector borrowers wait for
another does of loan waiver. One time settlement is another macro
level concerns. As the judicial process is time consuming and
ineffective, banks have been advised by RBI to explore possibility
of out of court settlement with defaulting borrowers. This provides
scope for willful defaulters becoming eligible candidates for such a
settlement.
Take over accounts:
A recent study has revealed that incidence of NPAs more with regard
to take over account. This malady needs to be thoroughly probed into the
reason for take, and the subsequent slippage of these accounts into NPA
category raises many fundamental questions involving the motives, credit
investigation and appraisal system on the part of the bank. Banks must
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develop a credit information bureau in the own interest without waiting for
any initiative in this regard. The current situation encourages bad borrowers
to switch banks.
Risk taking ability of the banks:
Lastly, highly level of NPAs reduces risk taking ability of the banks,
it also affects the credit rating of banks, thereby restricting its ability to
approach the public for capital subscription alternatively, a low rating
substantially increases the cost of raising funds ever for tier 11 capital. Thus
it can be concluded that NPAs greatly affect the financial health of banks.
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Profile of the study
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RECOMMENDATION:
The NPAs could be segregated in to two categories.
1. NPAs arising due to genuine business problem.
2. NPAs arising due to willful defaults.
The first category defaulter could be tackled either by Advances family
concepts or by the specialized wing called Angle units . The second
category defaulters could be handled by the tool called NPA Trading.
Advance family concept:
This concept works on the principal of solidarity towards fraternity,
that is in difficult times other members of the family help the member in
trouble.The various advance accounts of any bank comprise diverse business
fields. These accounts could be viewed as members of a large family of the
bank. The member having at least one thing common availed advance from
the same bank. There would, of course be many others things common
Any business unit could find it self under problem, because ofmainly two reasons.
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a)Financial problem:
In this type of problem generally the banks branch manages is able to
help, provided that falls under his purview or with the intervention of the
higher authority, if needed.
b) Operational problem:
This is the area where the advance familys concept is really
applicable and should prove helpful. The following points should able to
illustrate this concept clearly.
Another example could be of sourcing the raw material or marketing
or finished goods problems. Here again the branch manager could
bring the prospective parties to the table and left them have
meaningful discussion.
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Angle units:
This concept is applicable only genuine case of default ( as assessedby the branch manager or other appropriate authority.)
During defaults times the borrowers accounts experience thefollowing two things.
1 Defaults in repayments of the principal/ interest due to thebank.
2 More need of funds.
If we see both points together, the business units condition is bound to be
worse off because of one hand the defaults in repayment prevents the
borrower from having access to the funds and on the other hand unless funds
the need for funds is met with. The business would not yield anything and
thus triggers further defaults in repayments.
Present set-up:
Under present set up the branch manager takes up the NPA case with next
higher authority for the release of more funds and if it is deemed fit them the
funds are sanctioned.
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Suggested set up:
A separate wing could be spun off only for funding these loss making
units after a careful analysis of the viability of the unit concerned. The pre-
requisite for this only genuine cases be referred to this wing. After the
troubled unit turned around the previously out standing amount and some
free towards processing of further funds application could be charged, which
we think the borrower will be more than happy to pay up.
NPA Trading:
This could be bankers powerful tool to guard against the cases of
willful defaults. The functioning of this method could more easily
understand by the following example.
Mr A hailing from a well to do family takes a loan from banks
X and after some time starts defaulting the repayments, even
when his other accounts with bank Y and bank Z are
performing well with huge surplus in them.
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Present set-up:
Under present set up bank X will be fight on its own and after
exhausting all its attempts for non legal amicable settlement of its dues with
the borrower Mr A would resort to legal remedy by filing a suit in the court
of law. Thus triggering a virtually perennial wait for settlement of its dues.
Proposed set up:
Under proposed set up the bank X would be able to sell this NPA
account to bank Y at discount. This action would be the course, taken after
giving Mr A reasonable time to pay up. This bank Y would in turn try to set
off Mr. As dues with his accounts in this bank. If the bank Y is successful
in setting off the complete due amount them the amount realized minus the
amount paid to the bank X is the net profit to the bank Y in this deal.
In case bank Y is not able to set off Mr As account them it will
further sell it to the bank Z. Te bank Z will finally set-off the remaining
outstanding due in this account.
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NARASIMHAM COMMITTEES
RECOMMENDATIONS:
Committee on financial system Narsimhan committee which reported
in 1991. Mean while major changes have been taken place in the domestic
economic and institutional scene, indicating with the movement towards
global integration of financial services committee has presented second
genera in reforms.
1. To strength the foundation of financial system.
2. Related to this, streamlining procedure, upgradingtechnology and human resource development.
3. structural changes in the system.
It is recommended that an assets be classified as doubtful if it is in thesubstandard category for 18 months in the first instance and eventually for12 months as loss if it has been so identified but not written off. Thesenorms, which should be regarded as the minimum may be brought into forcein a phased manner.
NPA figured do not include advances covered by governmentguarantees which have turned sticky and which in the absence of suchguarantees would have been classified as NPAs.
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The committee believes that objective should be reduce the averagelevel of net NPA for all FIs to below 5% by the year 2002 and 3% by 2005.These target cannot be achieved in the absence of measure to tackle the
problem of backlog of NPAs on one time basis and the implementation ofstrict predential norms and management efficiency to prevent the recurrenceof this problem.
With regard to income recognition in India, income stops accruingwhen interest/ installment of principal is not paid with in 180 days. Howeverwe should move toward international practices in the regard and introducethe norms of 90 days in a phased manner by the year 2002.
At present there is no provision in India for a general provision onstandard assets. However a general provision say of 1% would beappropriate and RBI should consider its introduction in phased manner.
FIs should pay greater attention to assets liability management toavoid mismatch and to cove, among others liquidity and interest rate risks.
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SIGNIFICANCE OF THE STUDY
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SIGNIFICANCE OF STUDY
In the context of global competition, it is a paramount task for the banks tomanage the non performing assets more efficiently so that they can changetheir character from non performing assets to performing assets.
Following are the some of the point which shows the significance of thestudy
This study is an attempt to analysis classification of NPAS and alsoto identify the factors responsible for the growth of the NPAS
Reduction of NPAS is the need of the hour and this study will resultin the suggestion that would help the banks to reduce NPAS
Banks gain if NPAS are resolved at early stage so this study isrelevant.
This study is also significant as the impact of NPA,S on profitability ,
net advances of the banks.
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OBJECTIVES OF THE STUDY
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OBJECTIVES OF THE STUDY
If a study conducts there must have some objective because objectivesserves the basic of the study.
To find out the level of advances in the Indian public and privatesector banks.
To find out the level of Non Performing assets in the Indian publicand private sector bank.
To find out the effect of Non Performing assets on the profitability ofthe Indian public sector and private sector bank.
To find out the reasons behind the Non Performing assets.
Main objective of the study is to understand the comparison as takingNon Performing assets in public and private banks.
To study the effect of Non Performing assets on Indian economy.
To find out the level of advances in the Indian overseas bank andindustrial credit and investment corporation of India (yamuna Nagar)
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To find out the level of Non Performing assets in the Indian overseasbank and industrial credit and investment corporation of India(yamuna Nagar).
To find out the effect of Non Performing assets on the profitability ofthe Indian overseas bank and industrial credit and investmentcorporation of India (yamuna Nagar).
Another Main objective of the study is to understand the comparisonas taking Non Performing assets in Indian overseas bank andindustrial credit and investment corporation of India (yamuna nagar).
And also find out that these non performing assets by whom paid.
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Literature Review.
.Bhole L.M, Financial institution and market 9. In this theintroduction, meaning and concept of non performing assets are gives.Apart form this it also contain the guideline, objective managementcharactersticks of non performing assest are given. Apart from this bookalso contain some data related to non performing assets.
Srivastava R.M, Indian financial system. In this book classificationof loan assets of scheduled commercial banks from 1997 to 2000 are given.
Apart from this bank group wise gross and net non performing assets ofscheduled commercial banks from 1997 to 2000 are given..
Varshney P.N, Mittal D.K, Indian financialsystem7 In thisbook impact of priority sector advances on non performing assets, factor
for the non perform assets in Indian commercial banks. Suggession for
containing non performing assets in commercial banks and steps taken
by RBI for containing non performing assests.
RBI bulletin In the R.B.I bulletin information is given about the trends
and progress of the public sector banks which include sector wiseclassification of the non performing assets and financial performance of thecombined public and private sector banks.
Varshney P.N, Mittal D.K, Indian financial system In this book
incremental profits and provision vis a vis incremental assets. Gross andnet NPA of public sector banks and distribution of gross and net nonperforming assets of public sector banks and categorization of nonperforming assets and non performing assets of scheduled commercial
banks.
SOUTHERN ECONOMIST 2 In this journal gross and net nonperforming assets of the public sector banks. Apart from this classificationof advances of public sector banks and gross and net non performing assetsof public sector banks in percentage.
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SOUTHERN ECONOMIST 13 In this journal factor responsible foroccurrence of non performance assets and impact of non performing assetson profitability and lending spree of the banks and impact of the nonperforming assets on business banks.
SOUTHERN ECONOMIST 12 In this journal neoteric trends inbanking industry is given. Apart from this economics and financial data isgiven.
ECONOMIC AND POLITICAL WEEKLY 11 in this magazineinformation about non performer and public sector banks and nonperforming assets and Indian banking sector are explaining.
BUSINESS TODAY5. In this magazine challenges facing by publicsector banks and emergence of new private banks and non performingassets in public and private banks is given..
C.R Kothari 4 The information regarding the basics of research andresearch methodology , what are the different types of research designs,what is problem statement, what are the sources of data collection and whatare the methods of data collection is given in this section.
S.P Gupta 6. The information regarding the statistical tools and theirlimitations in different fields the research is given in this section. Thissection explains why to use correlation and what are the situations in whichcorrelation can be used, and what does correlation means. And also thissection explains the regression analysis technique.
WWW.ICICI.INDIACOM
Introduction about icici bank
NPA in in icici bank
Financial performance of icici bank.
http://www.icici.indiacom/http://www.icici.indiacom/ -
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www.equitymaster.com
o introduction about Indian overseas bank
o NPA recovery policy of the bank.
o Financial performance of Indian overseas bank.
www.Indiaininfoline.com
o reason for NPA
o management of NPA
WWW.RBI.ORG.IN
o Classification of loan assest of public and private sector
banks.o Trends and progress of bank for year
2001,2002,03,04,05,06.
WWW.BANKING.COM
RBI GUIDELINE FOR NPAS
http://www.equitymaster.com/http://www.indiaininfoline.com/http://www.rbi.org.in/http://www.banking.com/http://www.equitymaster.com/http://www.indiaininfoline.com/http://www.rbi.org.in/http://www.banking.com/ -
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RESEARCH METHODOLOGY
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RESEARCH DESIGN
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RESEARCH DESIGN
At the outset may be noted that there are several ways of
studying and tackling a problem. The formidable problem that follows the
task of defining the research problem is the preparation of the design of
research project popularly known as research design.
DESCRIPTIVE AND DIAGNOSTIC RESEARCH DESIGN: -
Descriptive research design are those design which
are concerned with describing the characteristics of particular individual or
of the group.
Research design in study: -
In the study I will apply descriptive research
design. As descriptive research design is the description of state of affairs,
as ix exists at present. In this type of research the researcher has no control
over the variables, he can only report what ahs happened or what is
happening.
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ANALYTICAL TOOL
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Statistical tool and data analysis.
CORRELATION
For analyzing the data I will use correlation and regression methods the correlation. I willuse correlation for knowing the relationship between the exports and FDI.And the regression I will use to know the nature of relationship in the FDI and exports.
I will use correlation and regression to check
A) Whether there is any correlation exists between exports and FDI.B) Nature of the relationship between them (regression)
In the correlation I will be using Spearmans Rank correlation coefficient in which
R=1-6d2/N (N2-1) or 1-6d2/N3-N
Where R= rank coefficient of the correlationD= difference of ranks between paired Items.N= no of items.
REGRESSION ANALYSIS
To show the relationship between the dependent variable
(exports) and independent variable (FDI)
So the regression equation will be X on Y
X=a+bY
X=Na+bY
XY=aY+bY2
for analyzing the data I will be use the software ofXLSTAT.
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NPAS IN THE INDIAN BANKING SYSTEM
PUBLIC SECTOR BANKS:
NPAS is the one of the major problem in Indian banking sector.
Indian banking sector is facing a crisis, in view of mounting Non-performing
assets(NPAS) which are to the tune of Rs 56000 crore in the year 2002. It
has reached a critical level and require major operation to set the position.
The earning capacity and probability of many banks and financial institution
has been adversely affected by the high level of NPAS. Thus reduction of
Non performing assets is posing the biggest challenge to banks in Indian
economy.
Gross and Net NPAS:
The non performing assets in the public sector banks have reached
alarming proportion. Non performing assets is an important parameter in the
analysis of financial performance of banks. After the implementation of
prudential norms and follow up of the recommendation of various
committees, the Gross NPAS of public sector banks increased from Rs
43577 crore as at the end of 1997 to Rs 54773 crore at the end of March
2003.In the case of net NPAS in absolute terms also increased from Rs
20285 crore at the end of March 1998 to Rs 27969 crores at the end of
March 2001.
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GROUP WISE CLASSIFICATION OF LOAN ASSETS
OF PUBLICSECTOR BANKS.
( Amount in crores)
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Comparison of net advances and non
performing assets of public sector banks
( Amount in crores).
year
s
Standard
assets
Sub-
standard
assets
Doubtful
assets
Loss assets Gross NPAs Net NPA
Amount % Amoun
t
% Amoun
t
% Amoun
t
% Amoun
t
% Amoun
t
2000 200637 82.2
12472 5 26015 10.7
5090 2.1
43577 17.8
20285
2001 239318 84.0
14463 5.1
25819 9.1 5371 1.9 45653 16.0
21232
2002 273618 84.1
16033 4.9 29252 9.0 6425 2.0
51710 15.9 24211
2003 326783 86.0
16361 4.3 30535 8.0 6398 1.7
53294 14.0
26188
2004 523724 90.6
14909 2.6
32340 5.6 6840 1.1
54089 9.4 27969
2005 610435 92.2 16909 2.5
28756 4.4 5876 0.9
59541 7.8 34877
2006 830029 94.6 11068 1.3 30771 3.5 5929 0.7
47796 5.4 39355
2007 1092607
96.2 11453 1.0
25028 2.2 5336 0.5
42117 3.7 44904
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Comparison of net advances &NPA
Years Net Advances Non performing assets
2000 220000 20000
2001 260000 21000
2002 290000 24000
2003 352000 26000
2004 399000 27000
2005 549000 34000
2006 630000 39000
2007 840000 44000
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0
200000
400000
600000
800000
1000000
2000 2001 2002 2003 2004 2005 2006 2007
net advances
NPAs
CORRELATION(Amount in thousand crores)
X Y Dx(X-Ax) dx2 dY(Y-Ay) dy2 dxdy
220 20 -179 32041 -7 49 1253
260 21 -139 19321 -6 36 834
290 24 -109 11881 -3 9 327
352 26 -47 2209 -1 1 47
399 27 0 0 0 0 0
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549 34 150 22500 7 49 1050
630 39 231 53361 12 144 2772
840 44 441 194481 17 289 7497
348 335794 19 577 13780
Since the actual mean are not whole number we take 399 as assumed meanfor X and 27 for Y.
Applying the formula,
Ndxdy - dx. dy.r = ____________________________________________
N dx2-(dx)2 N dy2-(dy)2
= 8*13780-349*19_________________________________
8*335794-(348)2 8*577-(19)2
= 103628 0.99Ans.104065
so there is a high degree correlation between net advances and nonperforming assets of private sector banks and conclude that due to increasein net advances non performing assets also increase.
HYPOTHESIS TESTING
IN THIS STUDY HYPOTHESIS IS :
H0: There is no correlation between Net advances and Non performing
assets.
H1: There is a correlation between Net advances and Non performing
assets. Now we will test the hypothesis by rank correlation.
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Scattergram of the data
0
5000
10000
15000
20000
25000
30000
35000
40000
45000
50000
0 200000 400000 600000 800000 1000000
220000
Spearman's correlation coefficient test (non parametric test):
Observed =.990Two tailed =
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2001 8.2
2002 8.1
2003 7.4
2004 7
2005 4.5
2006 3.1
2007 2.1
% of NPA of net advances
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0
2
4
6
8
10
2000 2001 2002 2003 2004 2005 2006 2007
% of NPA of net
advances
PRIVATE SECTOR BANKS:
The eight new private banks that have emerged on Indian financial
topography since 1994 are clear out performance in an otherwise troubled
sector. In seven years, these banks have grown to account for six percent of
the total assets and 10% of the total profit of the banking industry.
It was the Narasimhan committee report dated 1991 that envisaged a
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large role of private sector banks. The RBI of the India agreed, and in an
effort to make the sector more efficient and competitive it issued in January
2000, the guideline governing the entry of new private banks, a minimum
capital of Rs-100 Crore among others.
The new private banks have grown not just organically but also
through mergers and acquisition. HDFC bank merged with Times Bank in
all stock deal had set up 510 ATMs ( Automatic teller machines), HDFC
bank 350 (ATMs). In general, the new private banks have rapidly taken to
technology.
Although these banks also facing the problem of NPAS as public
sector banks is facing. NPAS is also a major challenge which facing by the
private sector banks. In private sector banks NPAS also increasing year by
year. NPAS increased in private sector banks to Rs 6039 crore in March
2004 from Rs 4761 crore in march 2002.
GROUP WISE CLASSIFICATION OF LOAN ASSETS
OF PRIVATESECTOR BANKS.
( Amount in crores)
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Comparison of net advances and non
performing assets of private sector banks
( Amount in crores)
year
s
Standard
assets
Sub-
standard
assets
Doubtful
assets
Loss assets Gross NPAs Net NPA
Amoun
t
% Amoun
t
% Amoun
t
% Amoun
t
% Amoun
t
% Amoun
t
%
1999 27417 91.5 1370 4.6
899 3.0
283 0.9
2542 8.5 1539 5
2000 33567 91.3 1766 4.8
1077 2.9 343 0.9
3186 8.7 1863 5
2001 39848 89.6
2655 6.0
1584 3.6 404 0.9
4643 10.4
2956 6
2002 53317 91.5 2137 3.7 2355 4.0
439 0.8
4932 8.5 3120 5
2003 46761 91.1 1474 2.9 2772 5.4
321 0.6
4567 8.9 2548 5
2004 53516 92.4 1161 2.0
2727 4.7
504 0.9
4392 7.6 3142 3
2005 66212 94 784 1.1 2868 4.0 549 0.8 4201 6.0 3859 2
2006 81414 95.6 710 0.8
2551 3.0
479 0.6
3740 4.4 4368 1
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Comparison of net advances and NPAs of private bank
Years Net Advances Non performing assets
2000 28000 1500
2001 33000 1800
2002 42000 2900
2003 56000 3100
2004 49000 2500
2005 55000 3100
2006 67000 3800
2007 81000 4400
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0
10000
20000
30000
40000
50000
60000
70000
80000
90000
2000
2001
2002
2003
2004
2005
2006
2007
NPA
net advances
CORRELATION
(Amount in hundred crores)
X Y dx(X-Ax) dx2 dY(Y-Ay) dy2 dxdy280 15 -210 44100 -10 100 2100
330 18 -160 25600 -7 49 1120
420 29 -70 4900 4 16 -280
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560 31 70 4900 6 36 420
490 25 0 0 0 0 0
550 31 60 3600 6 36 360
670 38 180 32400 13 169 2340
810 44 320 102400 19 361 6080
190 217900 31 767 12140
Since the actual mean are not whole number we take 490 as assumed meanfor X and 25 for Y.
Applying the formula,
Ndxdy - dx. dy.r = ____________________________________________
N dx2-(dx)2 N dy2-(dy)2
= 8*12140-190*31_________________________________
8*217900-(190)2 8*767-(31)2
= 91230 0.97Ans.94032
so there is a high degree correlation between net advances and nonperforming assets of private sector banks and conclude that due to increasein net advances non performing assets also increase.
HYPOTHESIS TESTING
IN THIS STUDY HYPOTHESIS IS :
H0: There is no correlation between Net advances and Non performing
assets.
H1: There is a correlation between Net advances and Non performing
assets. Now we will test the hypothesis by rank correlation.
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Significance level: 0.05
Scattergram of the data
0
500
1000
1500
2000
2500
3000
3500
4000
4500
5000
0 20000 40000 60000 80000 100000
28000
Spearman's correlation coefficient test (non parametric test):
Observed =.959Two tailed =
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2000 5.4
2001 5.3
2002 6.9
2003 5.6
2004 5.2
2005 3.8
2006 2.7
2007 1.6
Net NPAs of private sector bank
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0
1
2
3
4
5
6
7
2000 2001 2002 2003 2004 2005 2006 2007
% of NPA of netadvances
COMPARISON OF GROUP WISE CLASSIFICATION
OF LOAN ASSETS OF PUBLIC SECTOR BANKS AND
PRIVATE SECTOR BANKS.
(Amount in crores)
Year 2000 2001 2002 2003 2004 2005 2006 2007
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Standard Assets
Public 200637 239318 273618 326783 523724 610435 830029 1092607
Private 27417 33567 39848 53317 46761 53516 66212 81414
Sub-Standard Assets
Public 12472 14463 16033 16361 14909 16909 11068 11453
Private 1370 1766 2655 2137 1474 1161 784 710
Doubtful Assets
Public 26015 25819 29252 30535 32340 28756 30771 25028
Private 899 1077 1584 2355 2772 2727 2868 2551
Loss Assets
Public 5090 5371 6425 6398 6840 5876 5929 5336
Private 283 343 404 439 321 504 549 479
Standard assets of public and private sector bank
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0
200000
400000
600000
800000
1000000
1200000
2000 2001 2002 2003 2004 2005 2006 2007
public sector
private s ector
Doubtful assets of public and private sector
0
5000
10000
15000
20000
25000
30000
35000
2000 2001 2002 2003 2004 2005 2006 2007
net advances
NPAs
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COMPARISON OF NON PERFORMING ASSETS PUBLIC
SECTOR BANKS AND PRIVATE SECTOR BANKS
PUBLIC SECTOR BANKS PRIVATE SECTOR BANKS
Years % of Net NPAs Years % of Net NPAs
2000 9.2 2000 5.4
2001 8.2 2001 5.3
2002 8.1 2002 6.9
2003 7.4 2003 5.6
2004 7 2004 5.2
2005 4.5 2005 3.8
2006 3.1 2006 2.7
2007 2.1 2007 1.6
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NPAs of public and private sector bank
0
2
4
6
8
10
12
14
16
2000
2001
2002
2003
2004
2005
2006
2007
% of NPA in
private sector
%of NPA in public
sector
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LIMITATIONS
Probably the time and money constraints can affect my research
Lack of knowledge about the topic.
I have used the secondary data for conducting the research that isinsufficient for the research.
Difficulty in collection of the data.
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SAMPALING DESIGN
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SAMPLING DESIGH:
In all sphere of life such as economics, social , business the need for
statistical investigation and data analysis is rising day by day. There are two
method for collecting the data.
1) census method.
2) Sampling method.
Sampling design used in my study:
I will use simple random sampling technique in my study. Followingare the expiation of sample I will use in my study.
In case of public sector banks.
INDIAN OVERSEAS BANK.
In case of private sector banks.
INDUSTRIAL CREDIT AND INVESTMENT CORPORATION OF INDIA
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DATA COLLECTION
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DATA COLLECTION
After the research problem has been identified and selected the next
step is to gather the requisite data. While deciding about the method of data
collection to be used for the the researcher should keep in mind two types of
data VIZ. primary and secondary.
METHODS USED IN STUDY: -
I have collected the data through the secondary sources such as
SECONDARY DATA:
Books
Magazines
Newspapers
Internet
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IN CASE OF PUBLIC SECTOR BANK
INDIAN OVERSEAS BANK:
Indian Overseas Bank (IOB) is a one of the major bank based in Chennai,with over 1,400 domestic branches and 6 branches abroad.
India Overseas Bank was established in 1937 to encourage overseas bankingand foreign exchange operations. The Indian Overseas Bank startedsimultaneously with three branches. They are:
Indian Overseas Bank Chennai Indian Overseas Bank Rangoon Indian Overseas Bank Singapore
From the begining Indian Overseas Bank served Chettinad, Ceylon (Sri
Lanka), Burma (Myanmar), Malaya, Singapore, Java, Sumatra and Saigon.
In 1960 Indian Overseas Bank absorved five weaker private sector banks
including Kulitali Bank. In the year 2000 India Overseas Bank India
engaged in IPO which brought the government's share in the bank's equity
down to 75%.
IOB International expansion:
1937-38: As mentioned above, IOB was international from itsinception with branches Indian Overseas Bank Rangoon, IndianOverseas Bank Penang, and Indian Overseas Bank Singapore.
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1941: IOB opened a branch in Malaya that presumably closed almostimmediately because of the war.
1946: IOB opened a branch in Ceylon.
1947: IOB opened a branch in Bangkok and re-opened others.
1948: United Commercial Bank (see below) opened a branch inMalaya.
1949: IOB opened a branch in Bangkok.
1963: The Burmese government nationalized IOB's branch inRangoon.
1973: IOB, Indian Bank and United Commercial Bank establishedUnited Asian Bank Berhad. (Indian Bank had been operating inMalaysia since 1941 and United Commercial Bank Limited had beenoperating there since 1948.) The banks set up United Asian to complywith the Banking Law in Malaysia, which prohibited foreigngovernment banks from operating in the country. Also, IOB and sixIndian private banks established Bharat Overseas Bank as a Chennai-
based private bank to take over IOB's Bangkok branch. The BaharatOverseas Bank is the only private bank that the Reserve Bank of Indiahas permitted to have a branch outside India. The ownership was:Indian Overseas Bank (30%), Bank of Rajasthan (16%), Vysya Bank(14.66%), Federal Bank (19.67%), Karur Vysya Bank (10%), SouthIndian Bank (10%) and Karnataka Bank (8.67%). Bharat Overseasserves the Indian ethnic community in Thailand.
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1977: IOB opened a branch in Seoul.
1991: Bank of Commerce (BCB), a Malaysian bank, acquired UnitedAsian Bank (UAB). In 1999 BCB merged with Bank BumiputraMalaysia to form Bumiputra-Commerce Bank Berhad.
GROUP WISE CLASSIFICATION OF LOAN ASSETS OF
INDIAN OVERSEAS BANK.
( In thousands)
Years Standardassets
Sub-standardassets
Doubtfulassets
Lossassets
Netadvances
NonPerformingAssets
Amount Amount Amount Amount Amount Amount %
2003 33889 394 942 - 35000 1300 5
2004 37080 250 425 - 37000 1700 3
2005 49807 302 519 - 51000 1800 2.5
2006 66794 133 526 - 67000 2600 1.6
2007 84505 89 476 - 85000 3600 1
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Comparison of net advances and non
performing assets of Indian overseas bank.
( Amount in thousand)
Years Net Advances Non performing assets
2003 35000 1300
2004 37000 1700
2005 51000 1800
2006 67000 2600
2007 85000 3600
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Comparison of net advances and NPA of IOB
0
20000
40000
60000
80000
100000
2003 2004 2005 2006 2007
net advances
NPAs
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CORRELATION
(Amount in 00
thousand)
X Y x (x-x) x2 Y (y-y) y2 xy350 13 -200 40000 -9 81 1800
370 17 -180 32400 -5 25 900
510 18 -40 1600 -4 16 160
670 26 120 14400 4 16 480
850 36 300 90000 14 196 4200
2750 110 178400 334 7540
X = X Y= YN N
2750 = 550 110 = 22
5 5
Applying the formula,
xyr = ____________________________________________
x2 *y2
= 7540_________________________________
178400*334
= 7540 = 0.899 Ans8383
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so there is a high degree correlation between net advances and nonperforming assets of private sector banks and conclude that due to increasein net advances non performing assets also increase.
REGRESSION
X Y XY x2350 13 4550 122500
370 17 6290 136900
510 18 9180 260100
670 26 17420 448900
850 36 30600 722500
2750 110 68040 1690900
Regression equation y on x.
Y=a+bx
The two normal equation are
y = Na +bx---------(1)
xy = a X + bx2---------(2)
substituting the value110=5a+2750b68040=2750a+1690900bmultiply 1 by 550 is2750a + 1512500b = 605002750a + 1690900b = 68040
after calculation the value of b is 0.04 and value of a is 44.
Y=44 + 0.04 X for 2007 the expected valueof net advance will be 940.
So expected non performing assets for year 2007 will be.
Y = 44 + 0.04*940
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= 81.6
so for 2007 net advances will be 94000 and non
performing assets are 8160
ESTIMATION OF FUTURE VALUE OF YEAR 2007OF NET ADVANCES WITH THE HELP OF TREND
ANALYSIS.
YEARS NET ADVANCES Y DEVIATIOIN FROM 2001 XY X2
2002 350 1 350 1
2003 370 2 740 4
2004 510 3 1530 9
2005 670 4 2680 162006 850 5 4250 25
2750 15 9550 55
The straight line trend is defined by the equation
Y=a+bx
The two normal equation are
y = Na +bx---------(1)xy = a X + bx2---------(2)
substituting the value2750=5a+15b9550=15a+55bmultiply 1 by 3 is15a + 45b = 825015a + 55b = 9550
after calculation the value of b is 130 and value of a is 160.
Y=160 + 130 X
For 2007 the value of x is 6
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Y = 160 + 130*6
= 940
Hypothesis Testing:
Significance level: 0.05
Scattergram of the data
0
500
1000
1500
2000
2500
3000
3500
4000
0 20000 40000 60000 80000 100000
35000
Observed value 0.968
Two-tailed p-value 0.032
Alpha 0.05
Decision:
At the level of significance Alpha=0.050 the decision is to reject the null hypothesis of absence of correlation.
In other words, the correlation is
significant.
Net NPAs of Indian overseas bank.
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years % of NPAs of net advances
2003 5
2004 3
2005 2.5
2006 1.6
2007 1
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%of NPA of net advances
0
1
2
3
4
5
2003 2004 2005 2006 2007
% OF npa OF NET
ADVANCES
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IMPACT OF NET ADVANCES ON THE NET PROFIT
OF THE INDIAN OVERSEAS BANK.
(Amount in thousand)Years Net Profit Net Advances
2003 3592 35000
2004 3990 37000
2005 4235 51000
2006 5376 67000
2007 6493 85000
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IN CASE OF PRIVATE SECTOR
BANK
INDUSTRIAL CREDIT AND INVESTMENT CORPORATION OF
INDIA.
ICICI Limited, was established in 1955 by the World Bank, the
Government of India and the Indian Industry, for the promotion of industrialdevelopment in India by giving project and corporate finance to theindustries in India.
ICICI Bank has grown from a development bank to a financial conglomerateand has become one of the largest public financial institutions in India.ICICI Bank has financed all the major sectors of the economy, covering6,848 companies and 16,851 projects. As of March 31, 2000, ICICI haddisbursed a total of Rs. 1,13,070 crores, since inception.
ICICI Bank is India's second-largest bank with total assets of about Rs.2,513.89 bn (US$ 56.3 bn) at March 31, 2006 and profit after tax of Rs.25.40 bn (US$ 569 mn) for the year ended March 31, 2006 (Rs. 20.05 bn(US$ 449 mn) for the year ended March 31, 2005). ICICI Bank has anetwork of about 614 branches and extension counters and over 2,200ATMs. ICICI Bank offers a wide range of banking products and financialservices to corporate and retail customers through a variety of deliverychannels and through its specialised subsidiaries and affiliates in the areas of
investment banking, life and non-life insurance, venture capital and assetmanagement. ICICI Bank set up its international banking group in fiscal2002 to cater to the cross border needs of clients and leverage on itsdomestic banking strengths to offer products internationally. ICICI Bankcurrently has subsidiaries in the United Kingdom, Russia and Canada,
branches in Singapore, Bahrain, Hong Kong, Sri Lanka and DubaiInternational Finance Centre and representative offices in the United States,
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United Arab Emirates, China, South Africa and Bangladesh. Our UKsubsidiary has established a branch in Belgium. ICICI Bank is the mostvaluable bank in India in terms of market capitalisation.
ICICI Bank's equity shares are listed in India on the Bombay StockExchange and the National Stock Exchange of India Limited and itsAmerican Depositary Receipts (ADRs) are listed on the New York StockExchange (NYSE).
ICICI Bank was originally promoted in 1994 by ICICI Limited, an Indianfinancial institution, and was its wholly-owned subsidiary. ICICI'sshareholding in ICICI Bank was reduced to 46% through a public offering ofshares in India in fiscal 1998, an equity offering in the form of ADRs listed
on the NYSE in fiscal 2000, ICICI Bank's acquisition of Bank of MaduraLimited in an all-stock amalgamation in fiscal 2001, and secondary marketsales by ICICI to institutional investors in fiscal 2001 and fiscal 2002. ICICIwas formed in 1955 at the initiative of the World Bank, the Government ofIndia and representatives of Indian industry. The principal objective was tocreate a development financial institution for providing medium-term andlong-term project financing to Indian businesses. In the 1990s, ICICItransformed its business from a development financial institution offeringonly project finance to a diversified financial services group offering a wide
variety of products and services, both directly and through a number ofsubsidiaries and affiliates like ICICI Bank. In 1999, ICICI become the firstIndian company and the first bank or financial institution from non-JapanAsia to be listed on the NYSE.
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GROUP WISE CLASSIFICATION OF LOAN ASSETS
OFINDUSTRIAL CREDIT AND INVESTMENT
CORPORATION OF INDIA.
.
( In thousands)
Years Standardassets
Sub-standardassets
Doubtfulassets
Lossassets
Netadvances
NonPerformingAssets
Amount Amount Amount Amount Amount Amount %
2003 - - 1775 - 36000 1700 4
2004 - - 938 - 45000 1900 2
2005 - - 815 - 57000 2100 1.6
2006 - - 592 - 72000 2500 1
2007 1601 - 100000 2800 1
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COMPARISON OF NET ADVANCES AND NON
PERFORMING ASSETS OF INDUSTRIAL CREDITAND INVESTMENT CORPORATION OF INDIA.
( Amount in thous)
Comparison of net advances with NPA
Years Net Advances Non performing assets
2003 36000 1700
2004 45000 1900
2005 57000 2100
2006 72000 2500
2007 100000 2800
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0
20000
40000
60000
80000
100000
2003 2004 2005 2006 2007
net advances
NPA
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CORRELATION
(Amount in 00
thousand)
X Y x (x-x) x2 Y (y-y) y2 xy360 17 -260 67600 -5 25 1300
450 19 -170 28900 -3 9 510
570 21 -50 2500 -1 1 50
720 25 100 10000 3 9 300
1000 28 380 144000 6 36 2280
3100 110 253000 80 4440
X = X Y= YN N
3100 = 620 110 = 22
5 5
Applying the formula,
xyr = ____________________________________________
x2 *y2
= 4440_________________________________
253000*80
= 4440 = 0.987 Ans4498
so there is a high degree correlation between net advances and nonperforming assets of private sector banks and conclude that due to increasein net advances non performing assets also increase.
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REGRESSION
X Y XY x2360 17 6120 129600
450 19 8550 202500
570 21 11970 324900
720 25 18000 518400
1000 28 28000 1000000
3100 110 72640 2175400
Regression equation y on x.
Y=a+bx
The two normal equation are
y = Na +bx---------(1)
xy = a X + bx2---------(2)
substituting the value110=5a+3100b72640=3100a+2175400bmultiply 1 by 620 is
3100a + 1922000b = 682003100a + 2175400b = 72640
after calculation the value of b is 0.02 and value of a is 34.4.
Y=34.4 + 0.02 X for 2007 the expected value
of net advance will be 1085.
So expected non performing assets for year 2007 will be.
Y = 34.4 + 0.02*1085
= 56
so for 2007 net advances will be 108500 and non
performing assets are 5600 (private sector NPA is less
then public sector.
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ESTIMATION OF FUTURE VALUE OF YEAR 2007
OF NET ADVANCES WITH THE HELP OF TREND
ANALYSIS.
YEARS NET ADVANCES Y DEVIATIOIN FROM 2001 XY X2
2003 360 1 360 1
2004 450 2 900 4
2005 570 3 1710 9
2006 720 4 2880 16
2007 1000 5 5000 25
3100 15 10850 55
The straight line trend is defined by the equation
Y=a+bx
The two normal equation are
y = Na +bx---------(1)
xy = a X + bx2---------(2)
substituting the value
3100=5a+15b10850=15a+55bmultiply 1 by 3 is15a + 45b = 930015a + 55b = 10850
after calculation the value of b is 155 and value of a is 155.
Y=155 + 155 X
For 2007 the value of x is 6
Y = 155 + 155*6
= 1085
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NET NPAS OF INDUSTRIAL CREDIT AND
INVESTMENT CORPORATION OF INDIA.
years % of NPAs of net advances
2003 4
2004 2
2005 1.6
2006 1
2007 1
%of NPA Of the Net Advances
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IMPACT OF NET ADVANCES ON THE NET PROFIT
OF THE
INDUSTRIAL CREDIT AND INVESTMENT
CORPORATION OF INDIA.
.
0
0.5
1
1.5
2
2.5
3
3.54
2003 2004 2005 2006 2007
% of NPA of net advances
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(Amount in thousand)Years Net Profit Net Advances
2003 3592 36000
2004 3990 45000
2005 4235 57000
2006 5376 72000
2007 6493 100000
COMPARISON OF NON PERFORMING ASSETS OF INDIAN
OVERSEAS BANK AND INDUSTRIAL CREDIT AND
INVESTMENT CORPORATIONOF INDIA.
INDIAN OVERSEAS BANK INDUSTRIAL CREDIT AND
INVESTMENT CORPORATION
OF INDIA
Years % of Net NPAs Years % of Net NPAs
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2003 5 2003 4
2004 3 2004 2
2005 2.5 2005 1.6
2006 1.6 2006 1
2007 1 2007 1
Comparison of NPA of IOB and ICICI
-
7/31/2019 Advance and Non Performing Assets
89/97
0
1
2
3
4
5
2003 2004 2005 2006 2007
%of NPA in IOB
% of NPA in ICICI
-
7/31/2019 Advance and Non Performing Assets
90/97
RESULTS AND FINDINGS
FINDINGS
Non performing assets is the major problem which is facing by theIndian banking sector.
-
7/31/2019 Advance and Non Performing Assets
91/97
In reality non-performing assets are very high in the banks.
In the last 3-4 years there is a decreasing trend in the non performingassets as percentage of net advances.
If we compare public and private sector banks, there is more nonperforming assets in the public banks as compare to private banks.
Non performing assets directly affect the growth of the banks.
Due to faulty legal system recovery of non performing assets takeslong time.
Target of the non performing assets recovery is not successfullyachieved by the banks.
Now banks are working on developing debt recovery tribunals tosolve the problem
Non performing assets reduce the risk taking ability of banks.
-
7/31/2019 Advance and Non Performing Assets
92/97
RECOMMENDATIONS
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7/31/2019 Advance and Non Performing Assets
93/97
Recommendations
Banks needs to have better credit appraisal systems as to prevent nonperforming assets from occurring.
However, once non performing assets do come into existence, theproblem can be solved only if there is enabling legal structure, sincerecovery of non performing after requires litigation and court order torecover stuck loans.
Only strong and efficient bank will be allowed to give commercialloans, while the weak bank will take position in less risky assets suchas government securities and inter-bank lending.
Efficient management system must be established by the banks.
More attention should be given by the banks to recovering the smallloans.
More delegation of powers must be done by the banks to its branches.
Some sticky policies should be adopted by the banks in recovering thenon performing assets.
Banks must established separate counter for recovery of the nonperforming assets.
-
7/31/2019 Advance and Non Performing Assets
94/97
Bibliography
-
7/31/2019 Advance and Non Performing Assets
95/97
Bibliography
BOOKS
1. Mithani D.M, money banking and international trade, himalaya publishinghouse.
2. Bhole L.M, Financial institution and market,, Forth edition. (PageNo.256 to 266)
3. Srivastava R.M, Indian financial system , himalaya publishing house.(pageno.-1.40 to 1.53
4. Kothari C.R, Research Methodology, New age international publications,second Edition
5. Khan M.Y , Fianancial survices, third edition(page no. 620-640)
6. Gupta S.P, Business Statistics, 30th edition, Sultan Chand & sons (Page no378-418)
7 Varshney P.N, Mittal D.K, Indian financial system, Sultan chand and sons.( page no 356 to 366)
JOURNALS & NEWSPAPERS
8 SOUTHERN ECONOMIST May 1 2005, CO-OPERATIVEBANKING IN INDIA (page no.-52-64)
10 SOUTHERN ECONOMIST OCTOBER 1 2003, MANAGEMENT OF NONPERFORMING ASSETS IN PUBLIC SECTOR BANKS.(page no.-9-12)
11 SOUTHERN ECONOMIST MARCH 1 2003, MANAGEMENT OF NONPERFORMING ASSETS IN BANKS.(page no.-15-17)
12 SOUTHERN ECONOMIST MAY 1 2002, NON PERFORMING ASSETSMANAGEMENT BY K.G.JOSE.(page no.-12-15)
13 SOUTHERN ECONOMIST MAY 1 2002, PERFORMANCE APPRAISALOF COMMERCIAL BANKS BY BHEEMANGOUDA.(page no.5-8)
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7/31/2019 Advance and Non Performing Assets
96/97
14 RBI bulletin, TREND AND PROGRESS OF BANK OF DEC 1999 (pageno.-887)
15 RBI bulletin, TREND AND PROGRESS OF BANK OF DEC 2003 (pageno.-1056)
16 RBI bulletin, TREND AND PROGRESS OF BANK OF DEC 2006 (pageno.-1568)
17 SOUTHERN ECONOMIST JUNE 1 2000, NEOTERIC TREND INBANKING INDUSTRY(page no.-15-17)
18 SOUTHERN ECONOMIST FEB 1 2001 ECONOMIC AND FINANCIALDATA (page no.-15-17)
19 ECONOMIC AND POLITICAL WEEKLY DEC 2 2000 NONPERFORMERS
20 INDIA TODAY BANKING, BED PENNY
21 BUSINESS TODAY FEB 2002 CHALLENGES FACING BY PUBLICSECTOR BANKS.
22 BUSINESS TODAY FEB 2002 EMERGENCE OF NEW PRIVATE BANKS.
Websites
23 WWW.ICICI.INDIACOM
Introduction about icici bank
NPA in in icici bank
Financial performance of icici bank.
http://www.icici.indiacom/http://www.icici.indiacom/ -
7/31/2019 Advance and Non Performing Assets
97/97
24 www.equitymaster.com
introduction about Indian overseas bank
NPA recovery policy of the bank.
Financial performance of Indian overseas bank.
24 www.Indiaininfoline.com
reason for NPA
management of NPA
WWW.RBI.ORG.IN
Classification of loan assest of public and private sector banks.
Trends and progress of bank for year 2001,2002,03,04,05,06.
WWW.BANKING.COM
RBI GUIDELINE FOR NPAS
http://www.equitymaster.com/http://www.indiaininfoline.com/http://www.indiaininfoline.com/http://www.rbi.org.in/http://www.banking.com/http://www.equitymaster.com/http://www.indiaininfoline.com/http://www.rbi.org.in/http://www.banking.com/