Impact of Non-Performing Assets on the Profitability of Select Public Sector and Private Sector Banks

Nationalized (government-owned) banks, commercial banks, and specialized banking institutions are the three basic categories of Indian banking. Banking industry plays a vital role for the development of the economy of any country Non-performing assets are a challenge that all banks are confronting today, whether they are public or private sector banks. Non-performing assets have been the single biggest source of annoyance for India's banking sector. The lender will lose money if the borrowers stop paying interest or principal on their loans. Such a loan is known as non-performing assets (NPA).Non-performing assets have a major impact on the Indian banking industry. The aim of the present research is to study the impact of Nonperforming Assets on Profitability of public sector banks and private sector banks for the ten years 2011 to 2020. On the basis of secondary data, the research paper seeks to assess various non-performing asset ratios.This research examines the significance of non-performing assets and its impact on Profitability using Regression. The finding reveals that there is no significant impact of Nonperforming Assets on profitability of select private sector banks during the period. The banking sector should focus on effective management of nonperforming assets (NPAs) in order to increase their profitability and so supply as much funding to the industry as possible