A STUDY ON NON-PERFORMING ASSETS MANAGEMENT WITH REFERENCE TO ICICI BANK

Management Studies

The banking industry is critical to a country's economic development. The number of non-performing assets is the best indicator of a country's banking sector's strength. Because the quality of assets in India's banking sector is moderately deteriorating, the country's banking industry is vulnerable. NPAs are suffocating the financial system. The bank's finances available for credit development are reduced when interest payments on loans stop and principal is not paid. Many banks are unable to offer new loans due to a lack of funds, limiting their ability to generate revenue. The public sector banks are disproportionately affected by nonperforming assets. The growth in nonperforming assets (NPA) has an impact not just on the banking industry but also on the economy as a whole. However, they have since expanded their operations to include other areas such as merchant banking, leasing, and venture capital, among others. Due to increased competition, private banks have been lending aggressively to consumers, which has resulted in a rise in the percentage of non-performing assets (Henceforth, NPAs). Non-performing assets (NPAs) have long been a key indicator of a bank's financial success since they result in lower margins and increased provisioning requirements for questionable loans. To ensure a steady flow of money, the banking industry should work to reduce nonperforming assets (NPAs) to zero. “NPA management falls under the risk management umbrella, which encompasses risk identification, assessment, monitoring, mitigation, and risk policy formulation” (Sujoy Kumar Dhar). Recovery through Lok Adalat, SARFAESI procedures, and filing a civil suit for dues recovery are all options for dealing with NPAs.

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