Effectiveness of NPA Control Measures in Managing Loan Assets in Banks

R.V. Naveenan, Sriyank Levi, Sarah Merlyn


The economic reforms instigated by the Ex- finance minister and Prime minister of India Dr. Manmohan Singh would have been stayed perfect without the restructuring of the Indian banking sector. The important side of norms and guidelines for making the whole segment pulsating and economical. The problem of losses and lower profitability of Non-Performing Assets (NPA) and liability mismatch in banks and the financial sector depend on how various risks are managed in their business. The lasting solution to the problem of NPAs can be achieved only with proper credit assessment and risk management mechanisms.

It is better to avoid NPAs at the market stage of credit consolidation by putting in place of rigorous and appropriate credit appraisal mechanisms. In order to achieve the objective of the study an appropriate methodology has been adopted. Research done is descriptive in nature. The present study is mainly based on Secondary data. The data is taken from the Ph.D. thesis titled “A Study on Handling Non-Performing Assets with special reference to Public Sector Banks in Kanyakumari District”.Statistical Tools used is the Friedman Test: The Friedman Test is a non-parametric test. It is used to test for differences between groups when the dependent variable being measured is ordinal.

This study tries to understand the effectiveness of existing measures in handling existing NPAs and the effectiveness of measures in controlling the incidence of new NPAs.


Banking, Lending, NPA, NPA classification, Types of NPA, Magnitude and Consequences, Recovery methods.

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