The study was conducted to establish framework for measuring and managing credit risk for fifteen private Banks and to analyse the relationship of diversified portfolio of credit advances and NPAs of private banks. The portfolios of all credit advances in all regions were considered for the study. It was found that the relationship between Over all NPAs of private sector banks had 17o correlation with that of individual Bank and portfolios of occupations plays significant role towards contribution of NPAs. Personal loans are inversely proportional to the NPAs and are significant in all regions. The credit advances towards services sector is very low even though, 62 % of India's GDP is from them. Hence, Banks need to diversify their portfolio to achieve a better credit equilibrium and establish Risk Management Information System. The study enables a Banking Industry to progress towards its goals and objectives in the most direct, and effective way.
Source: CURIE Journal; Jan2010, Vol. 2 Issue 4, p72-83, 12p, 10 Charts
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