Old and new private sector banks in india: Performance analysis

Title

Old and new private sector banks in india: Performance analysis

Creator

Prakash M.; Senthil Kumar A.; Girish S.

Description

In the era of globalization and liberalization, a bank has to compete with not only local players and also internationally. It is tough time for Indian banking industry. Banks take various steps to improve the performance and provide best services to customers. Performance of banks refers to the capacity in generating sustainable profitability. Banks need to evaluate the performance and find the strength and weakness by considering important ratios. Researchers have analysed the performance of banks applying various tools and techniques. The present study seeks to assess the financial performance of old and new private sector banks operating in India. One of the models for assessing the performance of banks are CAMEL model. The study was conducted using secondary data. The study covered a period of 10 years and the data collected for study had been analysed using Simple Arithmetic Mean, Coefficient of Variation, Linear Growth Rate, Analysis of Variance (ANOVA) and Ranking for CAMEL model. Under this model, banks have been rated based on five criteria namely, C-Capital Adequacy, A-Asset Quality, M-Management Efficiency, E-Earning Quality and L-Liquidity. This study was conducted on the financial performance of twenty banks consisting of seven new private sector banks and thirteen private sector banks in India. The result has disclosed that various banks have been performing well in different parameters. As per CAMEL model overall ranking, Karur Vysya bank, Federal bank and Tamilnad Mercantile banks have occupied first three spots under the old private sector banks. In the case of the new private sector banks the first three slots have been held by HDFC bank, Kotak Mahindra bank and Yes bank respectively. The estimated ratios have disclosed that the new private sector banks have been enjoying a better financial health than the old private sector banks during the study period. The old private banks have to pay attention to improve the financial performance in the future. 2020 SERSC.

Source

International Journal of Advanced Science and Technology, Vol-29, No. 5, pp. 4919-4933.

Date

2020-01-01

Publisher

Science and Engineering Research Support Society

Subject

CAMEL model; Old banks; Performance; Private sector banks; Ratio analysis

Coverage

Prakash M., Department of Commerce, CHRIST Deemed to be University, Bengaluru, Karnataka, India; Senthil Kumar A., Department of Commerce and Management, St. Josephs College (Autonomous), Langford Road, Bengaluru, Karnataka, India; Girish S., Department of Commerce, CHRIST Deemed to be University, Bengaluru, Karnataka, India

Rights

Restricted Access

Relation

ISSN: 20054238

Format

Online

Language

English

Type

Article

Identifier

https://www.scopus.com/inward/record.uri?eid=2-s2.0-85084581437&partnerID=40&md5=23fa482296dcadce2d2fd85b8c070be0