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ANANALYSIS OF NPA IN PRIORITY SECTOR LENDING: A COMPARATIVE STUDY BETWEEN PUBLIC SECTOR BANKS AND PRIVATE SECTOR BANKS OF INDIA
Dr. Suresh Patidar International Institute of Professional Studies, DAVV Indore, spatidar99@yahoo.co.in Ashwini Kataria, Axis bank, Indore ashwini.kataria@yahoo.co.in ABSTRACT The Government of India through the instrument of Reserve Bank of India (RBI) mandates certain type of lending on the Banks operating in India irrespective of their origin. RBI sets targets in terms of percentage (of total money lent by the Banks) to be lent to certain sectors, which in RBI's perception would not have had access to organized lending market or could not afford to pay the interest at the commercial rate. This type of lending is called Priority Sector Lending. This paper examines the NPA in Priority Sector Lending and a comparative study is done between public sector banks and private sector banks. The study analyzed priority sector to find out the percentage share of NPA of components of priority sector lending, to study whether there is significant difference between NPA of SBI & Associates, Old Private Banks and New Private Banks with the NPA of Nationalized Banks, the benchmark category, and to find out the significant impact of Priority Sector Lending on the Total NPA of Banks using tools like regression analysis and ratio analysis. The result showed the significant impact of priority sector lending on total NPA of Public Sector banks, whereas in case of Private Sector Banks, there was no significant impact of priority sector lending on total NPA of Banks. Also the result showed the significant difference between NPA of SBI & Associates, Old Private Banks and New Private Banks with the NPA of Nationalized Banks, the benchmark category. Keywords: NPA, priority sector, commercial banks.

INTRODUCTION Ever since the introduction of financial sector reforms in India the NPA (non performing assets) of the banking system have been getting attention. NPA cause serious strain on the profitability as, on the one hand banks cannot book income on such accounts and on the other hand they are required to charge the funding cost and provision requirements to their profits. Since the early 90s the government has had to give over Rs. 23000 crores in bailouts to various BAUDDHIK

banks and financial institutions, out of the taxpayers money. Banks feel afraid of high risk of lending to priority sector because of lack of accounting and reputation, uncertain property rights of the assets they are holding and noncompliance with regulations. As per the international norms net NPA i.e. gross NPA less provision for loss are to be slashed down to 23%. India is the only country with an extensive set of policies supporting and protecting priority sectors by directly subsidizing them or exempting them from taxes and preferring them for government purchases.

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EISSN 2277-4955 The Government of India through the instrument of Reserve Bank of India (RBI) mandates certain type of lending on the Banks operating in India irrespective of their origin. RBI sets targets in terms of percentage (of total money lent by the Banks) to be lent to certain sectors, which in RBI's perception would not have had access to organized lending market or could not afford to pay the interest at the commercial rate. This type of lending is called Priority Sector Lending. Financing of Small Scale Industry, Small business, Agricultural Activities and Export activities fall under this category. This is also called directed credit in Indian Banking system. Action for enforcement of security interest can be initiated only if the secured asset is classified as Nonperforming asset. Non-performing asset means an asset or account of borrower, which has been classified by bank or financial institution as sub standard, doubtful or loss asset, in accordance with the direction or guidelines relating to assets classification issued by RBI. The banking sector has been facing the serious problems of the rising NPAs. But the problem of NPAs is more in public sector banks when compared to private sector banks and foreign banks. NPA means booking of money in terms of bad asset, which occurred due to wrong choice of client. Because of the money getting blocked the prodigality of bank decreases not only by the amount of NPA but NPA lead to opportunity cost also as that much of profit invested in some return earning project/asset. So NPA doesnt affect current profit but also future stream of profit, which may lead to loss of some long-term beneficial opportunity. Another impact of reduction in profitability is low ROI (return on LITERATURE REVIEW Gourav Vallabh, Anoop Bhatia, and Saurabh Mishra, (2004) in their article have made an attempt to analyse the movement of non-performing assets of public and private banks along with foreign banks operating in India during the 1994-95 to 2003-04, as impacted by macro-economic factors and bank specific factors, using regression techniques and ANOVA model. The observation was that NPA decrease with increased priority sector loans to total loans, and public sector loans were affected by macro economic variables at large. But this research didnt take interest rates, inflation rate in consideration. In the same line according to Muniappan (2002), there are many internal and external factors affecting NPLs. The internal factors might be taking up new projects, promoting associate concerns, time or cost overruns during the project implementation stage, business failure, inefficient management, strained labor relations, inappropriate technology/technical problems, product obsolescence, etc., while external factors are GDP growth (slow or fast), default in investment), which adversely affect current earning of bank. Amongst the priority sector components the SSI (small-scale industries) contribute the maximum share 19.24% in total NPA of public sector banks, 18.27% in total NPA of old private sector banks and 5.74% in total NPA of new private sector banks during 2002-03 as an individual component as per the Reserve Bank of India statistics. As per the RBI report on sectoral deployment of NPA 2002-03, the SSI contributed the maximum amongst various priority sectors.

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EISSN 2277-4955 other countries, shortage of energy sources, high inflation, accidents and natural calamities. Bercoff, Giovanniz and Grimardx (2002) in their study if Argentinean banks tried to measure NPAs by using accelerated failure model encompassing the various bank related parameters as well as macroeconomic variables. Some bank specific framework in which the banks operate, the quality of disclosure and the incentive structure of the management and Boards produce an inconsistent framework, which lead to an unsustainable performance level for a bank. The role of statistics such as the Economic Value of Equity (EVE) and EVE at Risk (EVER) (if mandatory disclosed on a monthly basis) in making these inconsistencies visible and therefore aiding in their elimination, was also explored in the paper. A. S. Ramasastri and N. K.Unnikrishnan (2005) said that, NPAs are largely fallout of banks' activities with regard to advances, both at the management and implementation levels (including overall controls by the top management), the credit appraisal system, monitoring of end-usage of funds. It also depends on the overall economic environment, the business cycle and the legal environment for recovery of defaulted loans. Since the overall environment is more or less same for all banks, non-performing loans of individual banks are mainly a result of management controls and systems put in place by them and recovery procedures. They concluded that higher than average credit expansion can further strengthen banks if there is a good credit appraisal systems, strict recovery procedures and overall checks and balances by the top management. OBJECTIVE OF THE STUDY 1. 2. To find out the percentage share of NPA of components of priority sector lending. Comparison of NPA in Priority Sector of Public Sector Banks with that of Private Sector Banks.

parameters in their study were ratio of net worth ti net assets, banks specific parameters in their study were ratio of net worth to net assets, banks exposure to peso loans, and type of bank such as foreign, private or public. Macroeconomic factors in this study were credit growth, foreign reserve interest adequacy rate, and (imports/reserves),

monetary expansion. The study established that variables such as operating cost, exposure to peso loans, credit growth, and foreign interest rate, had a negative effect on NPAs. The macroeconomic variables such as money multiplier and reserve adequacy had a positive impact on NPAs. In another research Nachiket Mor and Bhavna Sharma, (2002) highlighted some major micro-level issues that were believed to be the root of why unsustainable performance levels are being observed within banks. It was argued that unless the micro level issues would be dealt with, even after the systemic issues being resolved, the problem of NPAs or other failures of the intermediation process may resurface with greater intensity. According to the researchers, the manner in which banks manage the three phases in the life cycle of an asset (creation, monitoring and recovery) determines the quality of the intermediation process within a bank. In the paper, the need for internally consistent business models to guide the behavior of a bank in each of these three phases wais discussed. It was argued that the set of organizational competencies, the regulatory BAUDDHIK

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EISSN 2277-4955 3. To Study whether there is significant difference between NPA of SBI & Associates, Old Private Banks and New Private Banks with the NPA of Nationalized Banks, the benchmark category. 4. To find out the significant impact of Priority Sector Lending on the Total NPA of Banks. RESEARCH QUESTION Q. Is there any significant difference between NPA of SBI & Associates, Old Private Banks and New Private Banks with the NPA of Nationalized Banks, the benchmark category? Q. Is there any significant impact of Priority Sector Lending on NPA of Banks? Hypothesis H0: There is no significant difference between NPA of SBI & Associates, Old Private Banks and New Private Banks with the NPA of Nationalized Banks, the benchmark category. H1: There is significant difference between NPA of SBI & Associates, Old Private Banks and New Private Banks with the NPA of Nationalized Banks, the benchmark category. H0: There is no significant impact of Priority Sector Lending on Total NPA of Banks? H1: There is significant impact of Priority Sector Lending on Total NPA of Banks? Where, METHODOLOGY The work is a mix of doctrinaire and empirical survey. It draws heavily from related books, articles, reports, case studies and internet. The data about Indian banking downloaded from internet is crosschecked by the relevant RBI reports. To analyze the significant difference of NPA of SBI & Associates, Old Private banks and New Private BAUDDHIK VOLUME 3, NO.-1, JAN-APRIL-2012 NPAi,t = NPA of Bank i at time t. 0 = Intercept of Regression Equation. 1 = Slope of the Regression Equation. PSLi,t = Priority Sector Lending of i bank at time t. This study analyzed the significant difference of NPA of SBI & Associates, Old Private Banks and New Private banks with NPA of Nationalised Banks, being the base category, using Regression Analysis. The study also analyzed the significant impact of Priority Sector Lending on the Total NPA of Banks using Regression Analysis. To find the significant impact of Priority Sector Lending on the Total NPA of Banks, following methodology is used: NPAi,t = 0 + 1 PSLi,t + i,t For this research we have divided the components of Priority sector lending in 3 categories: 1. 2. 3. Agriculture Small Scale Industries Others

The methodology used to analyze the NPA of Priority Sector, Ratio analysis is used, where each component of priority sector is studied and comparison is done between public sector banks and private banks. Study also divided the components of NPA in Priority Sector in the following categories: 1. 2. 3. 4. SBI & Associates Nationalized Banks Old Private Banks New Private Banks

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EISSN 2277-4955 banks with NPA of Nationalised Banks, being the base category, following methodology is used: NPAi,t = 0 + 1D1SBIi,t + 2D2NPBi,t + 3D3OPBi,t + i,t NPAi,t = NPA of the Bank Group i. 0 = Intercept of Nationalized Banks, the Comparison Category. 1
=

The data has been taken of the following categories of Banks: 1. Public Sector Banks 1.1 SBI & Associates 1.2 Nationalised Banks 2. Private Sector Banks 2.1 Old Private Sector Banks 2.2 New Private Sector Banks Also the Advances and NPA in Priority Sector has been taken in the following categories: 1. Agriculture 2. SSI 3. Others The data has been collected from the RBI website as main source for the period of 10 years i.e. 1999 to 2008. Data Collection Method The data used to observe Advances and NPA in priority sector is taken for the period of 10 years i.e. 1999 to 2008. The data is collected through:

Differential Intercept Coefficient of SBI &

Associates. 2 = Differential Intercept Coefficient of New Private Banks. 3 = Differential Intercept Coefficient of Old Private Banks. D1SBIi,t D2OPBi,t D3NPBi,t
=

1 if observation belong to SBI & 1 if observation belong to New Private 1 of observation belong to Old Private

Associates, otherwise 0.
=

Banks, otherwise 0.
=

Banks, otherwise 0. Due to availability of limited resources, the study also has its own limitations. The study only covers the quantitative aspects of the NPA analysis; it doesnt cover the qualitative aspect. The study finds that there is significant impact of Priority Sector Lending on Total NPA of Banks, but the reason of the impact cannot be find out. Also there is significant difference between NPA of Nationalised Banks, with that of SBI & Associates, New Private Banks and Old Private Banks, but the reasons of these differences is not covered in the study. Sampling For the purpose of analyzing NPA, the whole population of banks in the categories of Public Sector and Private Sector has been considered for the Test. BAUDDHIK

www.rbi.org.in
Tools for Data Collection Secondary data has been used in this research. In this paper the data has been collected from various sites, books, journals and newspapers. Findings and Discussions Public Sector Banks The Public Sector Banks has played a prominent role in Priority Sector Lending. The Priority Sector Lending by the Public Sector Banks is increasing year by year. In 1999 the total Lending in Priority Sector by Public Banks was Rs. 104094 crores which is increased to Rs. 608963 crores in the year 2008. It is clear that the contribution of Agriculture in Priority Sector Lending, which was

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EISSN 2277-4955 36.15% in 1999 and 40.84% in 2008. There is significant decrease in the contribution on SSI in Priority Sector Lending, which was 40.92% in 1999 to 24.41% in 2008. The Others category in Priority

Sector contributed 22.73% in 1999 whereas 34.71% in 2008.

Priority Sector Lending by Public Sector

300000 250000

Rs Crores

200000 150000 100000 50000 0 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 Time

Agricuture SSI Others

The Lending in Priority Sector by Public Sector Banks is increased in the given years, whereas the NPA in Priority Sector is constant in the given years.

Advances and NPA in Priority Sector by Public Banks

700000 600000 500000 400000 300000 200000 100000 0 2001 2002 2003 2004 2005 2006 2007 2008 Time Total Advances Public NPA Public

The following graph represents the distribution of NPA in Priority Sector among its components. The BAUDDHIK VOLUME 3, NO.-1, JAN-APRIL-2012

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EISSN 2277-4955 NPA in Priority Sector was Rs. 24156 crores in 2001and Rs. 25286 crores in 2008.

NPA of Public Banks in Priority Sector

12000 10000

Rs Crore

8000 6000 4000 2000 0 2001 2002 2003 2004 2005 2006 2007 2008 Time

Agricuture SSI Others

Various Ratios of NPA in Public Sector Banks

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Date 31-Mar-01 31-Mar-02 31-Mar-03 31-Mar-04 31-Mar-05 31-Mar-06 31-Mar-07 31-Mar-08

Agri/NPSL 30.54 31.11 30.91 30.37 31.00 27.72 28.35 32.70

SSI/NPSL 42.80 42.10 40.75 37.07 33.49 30.92 25.46 22.96

Others/NPSL 26.66 26.79 28.35 32.56 35.51 41.36 46.20 44.35 44.35% in 2008.

NPSL/TotalNPA 45.43 44.49 47.23 47.54 50.02 54.07 61.67 63.62

category of NPA which was 26.66% in 2001 and Agri= NPA in Agriculture category of Priority Sector Lending SSI= NPA in Small Scale Industry category of Priority Sector Lending Others= NPA in Others category of Priority Sector Lending NPSL= Total NPA in Priority Sector Lending of Public Sector Banks. Total NPA= Total NPA of Public Sector Banks. Estimated Linear Regression Equation of Public The various ratios suggest that the performance of Public Sector Banks in terms of NPA, where Agriculture contributed 30.54% in 2001 and 32.7% in 2008, being constant. There was decline in SSI contribution in NPA of 42.8% in 2001 and 22.96% in 2008. There is increase in contribution by others Sector Banks NPAi,t = 60068.60 0.0393PSLi,t + i,t In order to identify the significant Impact of Priority Sector Lending on Total NPA of Banks, the regression analysis is used. The contribution in NPA by Priority Sector has increased over the years. It was 45.43% in 2001 to 63.62% in 2008.

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Independent Variables Constant PSL Coefficient 60068.6 -0.0393 Std. Error 2046.33 0.006 t-statistic 29.354 3.111 P-Value .000 .002 Null Hypothesis Rejected

Study proves that Priority Sector Lending has Other Statistics: R = 0.890 Adjusted R = 0.872 N=8 Degree of Freedom = 7 Since the coefficient is negative, it shows that there exist some linear relationship between Dependent and Independent variables. Beta Coefficient of PSL is -0.039. This shows that PSL has negative impact on Total NPA of Banks. At 95 % Confidence Interval, the t value (table) at 5% level of Significance = 1.98, which means that PSL with t value of 3.111, lies in rejection area. Hence null hypothesis is rejected. PRIVATE SECTOR BANKS The Private Sector Banks has also played a prominent role in Priority Sector Lending. The Priority Sector Lending by the Private Sector Banks is increasing year by year. In 1999 the total Lending in Priority Sector by Public Banks was Rs. 14155 crores which is increased to Rs. 163223 crores in the year 2008. It is also clear that the contribution of Agriculture in Priority Sector Lending, which was 23.01% in 1999 and 35.35% in 2008. There is significant decrease in the contribution on SSI in Priority Sector Lending, which was 45.57% in 1999 to 28.22% in 2008. The Others category in Priority Sector contributed 31.42% in 1999 whereas 36.42% in 2008.
2 2

significant impact on Total Non Performing Assets of Public Sector Banks. The value of R2 at .890 suggests that the independent variables reveal 89% of the reasons for change in dependent variable due to independent variables. F Value is 48.773 at .000 as p- value; it means that the model is significant. There is negative correlation between Independent variables and Dependent variable. Correlation between NPA and PSL comes out to be -0.944.

Priority Sector lending by Private Sector

90000 80000 70000 60000 50000 40000 30000 20000 10000 0 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 Time

Rs Crores

Agricuture SSI Others

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The Lending in Priority Sector by Private Sector Banks is increased in the given years, whereas the NPA in Priority Sector is also increased in the given years.

Advances and NPA in Priority Sector by Private Banks

180000 160000 140000 120000 100000 80000 60000 40000 20000 0

Rs Crores

Total Advances Private NPA Private

2001 2002 2003 2004 2005 2006 2007 2008 The following graph represents the distribution of NPA in Priority Sector among its components. The NPA in Time Priority Secotor was Rs. 1834.71 crores in 2001 and Rs. 3418.53 crores in 2008.

NPA of Private Banks in Priority Sector

1600 1400 1200

Rs Crore

1000 800 600 400 200 0 2001 2002 2003 2004 2005 2006 2007 2008 Time

Agricuture SSI Others

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EISSN 2277-4955 Various Ratios of NPA in Private Sector Banks

Date 31-Mar-01 31-Mar-02 31-Mar-03 31-Mar-04 31-Mar-05 31-Mar-06 31-Mar-07 31-Mar-08

Agriculture/NPSL 17.58 17.25 21.95 18.50 21.27 22.53 29.84 42.92

SSI/NPSL 54.54 58.33 51.60 50.86 44.06 35.35 22.35 19.05

Others/NPSL 27.88 24.42 26.45 30.64 34.67 42.12 47.82 38.03

NPSL/Total NPA 28.62 21.82 20.61 23.97 24.87 29.17 31.22 26.34

Agri= NPA in Agriculture category of Priority Sector Lending SSI= NPA in Small Scale Industry category of Priority Sector Lending Others= NPA in Others category of Priority Sector Lending NPSL= Total NPA in Priority Sector Lending of Private Sector Banks. Total NPA= Total NPA of Private Sector Banks. The various ratios suggest that the performance of Private Sector Banks in terms of NPA, where Agriculture contributed 17.58% in 2001 and increased upto 42.92% in 2008. There was decline in SSI contribution in NPA of 54.54% in 2001 and

19.05% in 2008. There is increase in contribution by Others category of NPA which was 27.88% in 2001 and 38.03% in 2008. The contribution in NPA by Priority Sector was constant over the years. It was 28.62% in 2001 to 26.34% in 2008. In order to identify the significant Impact of Priority Sector Lending on Total NPA of Banks, the regression analysis is used. Estimated Linear Regression Equation of Private Sector Banks NPAi,t = 9239.67 + 0.0084PSLi,t + i,t

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EISSN 2277-4955 Independent Variables Constant PSL Other Statistics: R = 0.043 Adjusted R = -0.116 N=8 Degree of Freedom = 7 The value of R2 at .043 suggests that the independent variables reveal 4.3% of the reasons for change in dependent variable due to independent variables. Since the coefficient is positive, it shows that there exist some linear relationship between Dependent and Independent variables. Beta Coefficient of PSL is 0.008. This shows that PSL has minimal impact on Total NPA of Banks. At 95 % Confidence Interval, the t value (table) at 5% level of Significance = 1.98, which means that PSL with t value of 0.521, lies in acceptance area. Hence null hypothesis is accepted. Nationalised Year 2001 2002 2003 2004 2005 2006 2007 2008 Mean SD SBI & Associates 20190.7 19743.57 16958.1 15158.61 14808.19 13193.38 12555.57 15220.39 15978.56375 2802.241861 Banks 32983.42 36762.78 35848.82 34989.7 31964.03 28184.85 24665.61 24528.12 31240.91625 4883.970507 New Pvt banks 1599.52 6816.41 7230.38 5951.19 4565.82 4118.3 6270.97 10418.91 5871.4375 2580.492695 Old Pvt banks 4810.82 4850.89 4636.05 4401.12 4234.01 3711.11 2968.51 2557.15 4021.2075 864.151732 F Value is 0.272 at .621 as p- value; it means that the model can be insignificant. There is positive correlation between Independent variables and Dependent variable. Correlation between NPA and PSL comes out to be 0.208. Comparison between NPA of Nationalised Banks, the base category with NPA of SBI & Associates, New Private Sector Banks and Old Private Sector Banks.
2 2

Coefficient 9239.67 0.0084

Std. Error 1503.57 0.016

t-statistic 6.145 0.521

P-Value .001 .621

Null Hypothesis Accepted

It was revealed that Priority Sector Lending has no significant impact on Total Non Performing Assets of Private Sector Banks.

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Estimates of Multi Regression Model Dummy Variable Approach NPAi,t = 0 + 1D1SBIi,t + 2D2NPBi,t + 3D3OPBi,t + i,t NPAi,t = NPA of the Bank Group i. 0 = Intercept of Nationalized Banks, the Comparison Category. 1
=

D1SBIi,t D2OPBi,t D3NPBi,t

1 if observation belong to SBI & 1 if observation belong to New Private 1 of observation belong to Old Private

Associates, otherwise 0.
=

Banks, otherwise 0.
=

Banks, otherwise 0. NPAi,t = 31240.91 0.591SBI 1.053OPB i,t 0.982NPB

Differential Intercept Coefficient of SBI &

i,t i,t

Associates. 2 = Differential Intercept Coefficient of New Private Banks. 3 = Differential Intercept Coefficient of Old Private Banks. Independent Variable Constant Dummy SBI & 31240.91 -0.591 28.258 -9.762 Coefficient t- statistic

P- Value .000 .000

Null Hypothesis Rejected

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EISSN 2277-4955 Associates Dummy Private Banks Dummy Old Private Banks Other Statistics: R2 = 0.932 Adjusted R = 0.924 N = 32 The nationalized bank is been taken as the benchmark category, on the basis of highest mean NPA produced in the given years when compared to other categories. Since the coefficient is negative, it shows that there exist some linear relationship between Dependent and Independent variables. The Difference showed by Coefficient of Dummy Variable with that of Constant, suggests that there is some significant difference in NPA of Nationalised Banks with NPA of other 3 categories. This study explored that there is significant difference between NPA of Nationalised Banks, with that of SBI & Associates, New Private Banks and Old Private Banks. The value of R at .932 suggests that the independent variables reveal 93.2% of the reasons for change in dependent variable due to independent variables. F Value is 127.22 at .000 as p- value; it means that the model is significant.
2 2

New

-0.982 -1.053

-16.226 -17.41

.000 .000

Rejected Rejected

CONCLUSION NPA is an important factor, which affects the performance of the banks. So it is very important to check it, from time to time and try to minimize it in order to get increasing returns. This study analysed the NPA in Priority Sector and comparison is also done between Public Sector Banks and Private Sector Banks. The following are the points of Conclusion: 1. The Total Priority Sector Advances by Public Sector Banks has been increased from Rs. 104094 crores to Rs 608963 crores in past 10 years, whereas Advances by Private Sector Banks has increased from Rs. 14155 to Rs. 163223 crores in past 10 years. 2. Advances in Agriculture category contributed highest 40.84% of Priority Sector Lending in 2008 by Public Sector Banks, whereas advances in Others category contributed highest 36.42% of Priority Sector Lending in 2008. 3. The reasons for growing Advances in Priority Sector is the Norms given by RBI, where banks need to compulsorily invest in these sectors. 4. NPA produced by Public Sector Banks Rs. 25286 crores is more than that of Private Sector Banks Rs. 3418 crores. 5. Using Regression analysis it is clear that Priority Sector lending has significant impact on Total NPA in Public Sector Banks, whereas in Private Sector Banks Priority Sector lending has no significant impact on Total NPA. 6. It is also clear that there is significant difference between NPA of Nationalised Banks, with that of

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EISSN 2277-4955 SBI & Associates, New Private Banks and Old Private Banks. REFERENCES Gourav Vallabh, Anoop Bhatia, and Saurabh Mishra (May 2004), Non Performing Assets of Indian Public, Private and Foreign Sector Banks: an empirical assessment Icfai Journal of Bank Management, Vol. 6, No. 3, pp. 7-28, August 2007 Hippolyte Fofack, (November 2005), Nonperforming Loans in Sub-Saharan Africa: Causal Analysis and Macroeconomic Implications World Bank Policy Research Working Paper No. 3769 Syeda Zabeen Ahmed (April 2006) An investigation of the relationship between nonperforming loans, macroeconomic factors, and financial factors in context of private commercial banks in Bangladesh Ph.D. Thesis Rajaraman, Indira, and G. Vasistha, (2002), Nonperforming Loans of Public Sector Banks-Some Panel results, Economic and Political weekly, February, 2002 Prashanth K Reddy (October 2002) A comparative study of Non Performing Assets in India in the Global context - similarities and dissimilarities, remedial measures Working Paper Mor, Nachiket and Sharma, Bhavna (2002) Rooting Out Non-Performing Assets iciciresearchcenter.org A. S. Ramasastri N. K.Unnikrishnan The effect of credit growth on NPAs Hindu Business Line, Chennai June 28, 2005 Rita Babihuga International Monetary Fund (IMF) May 2007IMF Working Paper No. 07/115

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EISSN 2277-4955 ANNEXURE Date 31-Mar-08 31-Mar-07 31-Mar-06 31-Mar-05 31-Mar-04 31-Mar-03 31-Mar-02 31-Mar-01 31-Mar-00 31-Mar-99 Date 31-Mar-08 31-Mar-07 31-Mar-06 31-Mar-05 31-Mar-04 31-Mar-03 31-Mar-02 31-Mar-01 31-Mar-00 31-Mar-99 Date 31-Mar-08 31-Mar-07 31-Mar-06 31-Mar-05 31-Mar-04 31-Mar-03 31-Mar-02 31-Mar-01 Date 31-Mar-08 31-Mar-07 31-Mar-06 31-Mar-05 31-Mar-04 31-Mar-03 31-Mar-02 31-Mar-01 Priority Sector Lending By Private Sector (Rs. Crores) Agriculture SSI Others 57702 46069 59447 52034 13136 76919 36712 10421 57777 21636 8592 38797 14730 7590 25786 11873 6857 17602 8022 8613 9074 5394 8158 7998 4023 8000 6345 3257 6451 4447 Priority Sector Lending By Public Sector (Rs. Crores) Agriculture SSI Others 248685 148651 211346 202614 102550 206661 155220 82434 163756 109917 68000 125114 84435 58311 96170 73507 52988 71448 63082 49743 53712 53571 48400 40791 45296 46045 30816 37631 42591 23661 NPAs of Private Sector Banks in Priority Sector (Rs. Crores) Agriculture SSI Others 1467.31 651.11 1300.1 860.51 644.59 1379.09 514.6 807.44 961.99 465.4 964.31 758.76 459.12 1262.41 760.39 536.78 1261.86 646.76 439.16 1485.26 621.93 322.47 1000.73 511.51 NPAs of Public Sector Banks in Priority Sector (Rs. Crores) Agriculture SSI Others 8268.03 5804.75 11213.9 6506.34 5843.28 10604.01 6202.92 6917.4 9253.43 7254.05 7834.96 8308.37 7240.3 8837.92 7762.11 7707.35 10161.53 7069.48 7821.54 10583.95 6733.85 7376.65 10339.41 6440.18 Total 163223 144549 106586 69886 48920 36705 25709 21550 18368 14155 Total 608963 521376 409748 307046 244456 203095 171185 149116 127478 104094 Total NPA 3418.53 2884.18 2284.03 2188.46 2481.93 2445.4 2546.35 1834.71 Total NPA 25286.67 22953.62 22373.74 23397.38 23840.33 24938.36 25139.34 24156.24

www.rbi.org.in
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