Analysis of Non-Performing Assets(Npas) In Priority Sector: A Comparative Study of Public and Private Sector Banks

Transcription

1 ISSN Analysis of Non-Performing Assets(Npas) In Priority Sector: A Comparative Study of Public and Private Sector Dr. (Mrs.) Paramjit Nanda* Priyanka Mahajan** * Professor in Economics, Punjab School Of Economics, Guru Nanak Dev University, Amritsar , Punjab, India. ** Research Scholar In Economics, Punjab School Of Economics, Guru Nanak Dev University, Amritsar , Punjab, India ABSTRACT The present paper is an attempt to study trends in advances and NPAs of priority sector (agriculture and weaker section) of Scheduled Commercial banks (SCBs) (public (27), private banks (31) and foreign banks (31)) during the period , to undertake inter-bank comparison of priority sector advances and NPAs in public and private sector and to know effect of priority sector advances on NPAs in public sector and private sector in 2001 and The findings of the study reveals that public sector banks witnessed higher Gross NPA to total assets ratio, net NPA to total assets ratio, gross NPAs to gross advances ratio and net NPAs to net advances ratio as compared to private sector banks during period Regression results indicated that advances to agriculture and weaker section significantly affected NPA in agriculture and weaker section of public sector banks in 2001 as well as in Study also reveals that priority sector advances play significant role in affecting NPA of public sector banks and efforts should be made for efficient recovery of priority sector loans. For this purpose, there should be proper selection of the borrower. should ensure proper end-use, proper post sanction follow up, regular contact with borrower, regular monitoring of the accounts and hold recovery camps. Key Words : Nationalized banks, Advances, Non-Performing Assets, Scheduled Commercial, Priority Sector 188

2 INTRODUCTION Rural credit plays an important role in rural development of a nation. In pursuance of rural credit, three pronged strategy was adopted in form of expansion of institutional structure, directed lending and concessional or subsidized credit. But all these efforts while impressive in quantitative terms have not brought about desired results in qualitative terms before As a result, productivity, efficiency and profitability suffered and non-performing assets increased. There was financial repression. But, during post -1991, financial reforms led to enhanced competition, increased autonomy, technological upgradation, competitive changes and reduction in non- performing assets (NPAs). The present paper is an attempt to study trends in advances and NPAs of priority sector (agriculture and weaker section) of Scheduled Commercial banks (SCBs) (public (27), private banks (31) and foreign banks (31)) during the period , to undertake inter-bank comparison of priority sector advances and NPAs in public and private sector and to know effect of priority sector advances on NPAs in public sector and private sector in 2001 and Accordingly, the paper has been divided into three sections. Section I examines trends for SCBs, Section II undertakes Inter-bank comparison, while Section III gives empirical results along with conclusions and implications. Data for the above analysis has been taken from Report on Trend and Progress of Banking in India, R.B.I (various issues). Simple regression analysis has been applied to know the effect of priority sector advances on NPAs in the following way. Where Y = NPAs in agriculture, weaker and priority sector. X = Loans in agriculture, weaker and priority sector. It is hypothesised that there exists positive relationship between advances in priority sector and NPAs in priority sector. I TRENDS IN NPAs (i) Growth of Gross and Net NPAs Table 1 showing the trends in gross and net NPAs of different bank groups during the period to reflects the fact that in absolute terms, the gross and net NPAs increased continuously for SCBs and for all bank groups during the period to except foreign banks (these banks registered a decline in net NPAs in and ). All these banks after reaching a peak level of gross and net NPAs in witnessed a declining trend afterwards. The gross NPAs of SCBs increased from Rs crore in to Rs crore in with an increase of 39.4 percent, while net NPAs increased by 49.6 percent to Rs. 35,554 crore from Rs. 23,761 crore during the same period. Bank group-wise also, gross 189

3 NPAs increased for public sector banks, private sector banks (old and private) and foreign banks to Rs. 56,473 crore, Rs crore, (Rs crore and Rs crore), Rs crore in over the levels of Rs. 45,653 crore, Rs crore (Rs crore and Rs. 392 crore), Rs crore in , with an increase of 23.7 percent, 266 percent (73.6 percent and 1637 percent) and 37 percent. Net NPAs of public sector banks, private sector banks (old and private) and foreign banks increased from Rs. 21,232 crore, Rs. 1,863 crore (Rs crore and Rs. 291 crore) and Rs. 666 crore in to Rs. 27,958 crore, Rs crore, (Rs crore and Rs crore) and Rs. 920 crore in , thereby experiencing an increase of 31 percent, 258 percent, (91 percent and 1158 percent) and 38 percent during same period. Thus, new private sector banks witnessed steep increase in gross/net NPAs in over due to merger. After , due to improvement in asset quality of banks, gross NPAs of new private sector banks decreased rapidly (i.e. by percent) followed by foreign banks (19.58 percent) and public sector banks (16.19 percent) in as compared to , while net NPAs observed most rapid decrease in case of public sector banks (40.47 percent) followed by old private sector banks (38.58 percent) and foreign banks (29.56 percent) over the same period. SCBs undertook measures like rechedulement restructuring at bank level, corporate debt restructuring recovery through Lok Adalats, Civil Courts and debt recovery tribunals and compromise settlements and enactment of SARFAESI (Securitization and Reconstruction of Financial Assets and Enforcement of Securities Interest) etc. (Economic Survey, ). Regarding contribution of various bank groups, public sector banks constitute large share in gross NPAs (share ranging between percent and per cent during the period). During the period, share of public sector in gross NPAs declined from percent in to percent in , while of private sector banks (old and new) increased from 6.26 percent (5.49 percent and.77 percent) to percent (7.21 percent and 7.84 percent) during the same period and of foreign banks increased marginally from 3.88 percent to 4.46 percent in (ii) Ratio of Gross/Net NPAs to Total Assets Table 2 shows that nationalised banks had highest gross NPAs to asset ratio during the period to , followed by SBI bank group( to 99-00) and old private sector banks ( to ) while net NPAs to asset ratio was highest for old private sector banks followed by nationalised banks during the study period. Gross as well as net NPAs to assets ratio decreased for all bank groups except private sector banks as whole and new private sector banks. The percentage of gross NPAs to total assets decreased from 6.4 percent in to 2.5 percent in in the case of SCBs. The public sector banks, nationalised banks, SBI group and old private banks and foreign banks registered a decline from 7.03, 7.24, 6.67, 5.06 and 3.0 to 2.74, 2.98, 2.49, 3.15 and 1.0 percent during the same period. Private sector banks as group and new private sector banks witnessed fluctuating but increasing trend from to and experienced decline in gross NPA/assets ratio afterwards. 190

4 The percentage of net NPAs to total assets declined from 3.0 in to 0.91 percent in for SCBs. In case of public sector banks, nationalised banks, SBI bank group, old private sector banks and foreign banks, net NPAs to total assets ratio declined from 3.27 percent, 3.48 percent, 2.89 percent, 2.84 percent and 1.0 percent to 0.99 percent, 0.96 percent, 1.01 percent, 1.39 percent and 0.4 percent during the same period. (iii) Ratio of Gross/Net NPAs to Gross/Net Advances Table 3 reflects the fact that public sector banks had the highest ratio of gross NPAs to gross advances ratio followed by old private banks, new private banks and foreign banks, while old private sector banks had highest ratio of net NPAs to net advances ratio followed by public sector banks, new private banks and foreign banks. During the period ( to ), public sector banks witnessed continuously declining trend in gross NPAs to gross advances ratio and in net NPAs to net advances ratio (however SBI witnessed only marginal increase in ratios in ). Private sector banks (old and new) witnessed fluctuating but increasing trend in both ratios during period to , but continuous declining trends from to Private sector banks expects rapid increase in ratios in Gross NPAs as a percentage to Gross Advances decreased from 14.4 in to 5.2 in in the case of Scheduled Commercial, from (16.88, 14.57) to 5.53 (5.84, 5.32) in case of public sector banks (nationalised, SBI group) and from 6.4 to 2.8 in case of foreign banks during the same period, whereas they increased from 3.93 (5.06, 1.52) to 4.44 (5.97, 3.59) in the case of private sector banks (old, new) during the same period. Scheduled commercial banks witnessed decline in ratio due to high provisions (upto 40 percent) made for NPAs by them. Net NPAs as a percentage of net advances decreased for SCBs from 7.3 in to 2.00 in and for all bank groups during the same period. TRENDS IN ADVANCES AND NPAs IN PRIORITY SECTOR Domestic banks had been directed to deploy 40 percent of credit to priority sector, as a result, public sector banks and old private sector banks have been deploying about 43 per cent of net bank credit to priority sector in 2001 as well as in 2005 and credit to priority sector increased in 2005 as compared to 2001 (Table 4). As a result, priority sector contribution to NPAs also increased for public sector banks and old private sector banks in 2005 as compared to 2001 and ranging between (for old private sector banks) and (for nationalised banks) in 2001 and between (for old private sector banks) and percent (for nationalised banks) in Sector-wise priority sector advances and NPAs among banks group given in Table 4 shows that public sector banks had a higher share of net bank credit in agriculture, weaker section advances as well as in NPAs in these sectors than private sector banks in 2001 as well as in 2005., With in public sector banks, SBI group had higher share of net bank credit than nationalised banks in agricultural and priority sector advances in 2001 while nationalised banks had higher share in these advances in In weaker section advances, SBI had higher share in 2001 as well as in Within private sector banks, old private sector banks had a 191

5 higher share in agriculture and weaker section advances than new private sector banks in 2001 (in priority sector in 2001 as well as in 2005). Sector-wise NPAs in priority sector given in table shows that within public sector, SBI in 2001 and nationalised banks in 2005 had high share of NPAs in agricultural loans. In weaker sections and priority sector loans, nationalised banks in 2001 and SBI in 2005 had large share in NPAs. Within private sector banks, old private banks had share of NPA in agriculture and priority sector loans in 2001 as well as in Regarding weaker sections loans, new private sector banks had large share in NPAs in 2001, while old private banks in II INTER-BANK COMPARISION OF ADVANCES AND NPAs IN PRIORITY SECTOR (a) PUBLIC SECTOR BANKS Advances Trends in advances of various public sector banks given in Tables 5 and 6show that all banks witnessed an increase in advances in 2005 as compared to However, advances of UCO bank and Vijaya Bank have experienced rapid increase in advances in priority sector, of UCO and SB of Patiala in agricultural sector and of Union Bank of India and Bank of India in weaker section advances. Of priority sector, agricultural and weaker section advances, Canara Bank, Punjab National Bank constitute major share in these advances in 2001 as well as in Other banks constituting major share include Bank of Baroda, Bank of India and Union Bank of India. Regarding the deployment of credit in priority sector, table 5 and 6 shows that in 2001, S.B. of Travancore was deploying major share of NBC in priority sector loans (62.64 percent) while UCO Bank was deploying very small share (33.79 percent). In 2005, Bank of India remained at top position, While SBI remained at least position by deploying percent and percent of NBC in priority sector loans. In agricultural loans and in weaker section loans, Indian Overseas Bank remained at top position by deploying percent and of NBC in these sectors while UCO Bank remained at least position in agricultural loans and Corporation Bank in weaker section loans by deploying only percent and 2.48 percent of NBC in these sectors in In 2005, PNB and Bank of India took the lead in agricultural and weaker section loans by deploying percent percent of NBC in these sectors, while Corporation Bank remained again at least position in these sectors. Regarding targets fixed for priority sector loans, all the banks have performed well by exceeding the target (40 percent) except (United Bank of India and UCO Bank in 2001 and United Bank of India and SBI in 2005). However, there were short falls under sub-targets set for agriculture (18 percent) and weaker sector advances (10 percent) in In 2001, only 4 banks exceeded the target in agricultural loans, and 6 banks in weaker section loans. Position improved in 2005 as 13 banks were fullfilling targets in agricultural loans and 11 banks in weaker section loans due to special efforts made by Government of India. Government of India 192

6 set up Rural Infrastructure Development Fund under which commercial banks were required to deploy their short falls in priority sector/agricultural loans, and interest rates on RIDF deposits kept are inversely related to shortfall in lending to agricultural sector (Economic Survey, ) NPAs Trends in NPAs of various public sector banks indicate that out of 27 banks considered, 13 banks have experienced an increase in NPAs in priority sector advances, 12 banks in weaker section and only 7 banks in agricultural sector in 2005 as compared to 2001 NPAs of Oriental Bank of Commerce and Punjab & Sind Bank increased at rapid rate in priority as well as in agricultural sector, while in weaker section loans, SB of Patiala along with OBC experienced rapid increase. Regarding contribution of various banks in NPAs of public sector banks, Bank of Baroda along with Bank of India had major share in agriculture sector, while PNB had major share in priority sector in 2001 as well as in 2005 (Punjab & Sind Bank in 2005 only, while Central Bank in priority sector advances in 2001 only). In weaker section, Canara Bank along with Punjab & Sind Bank in 2001 and Bank of India along with Bank of Baroda in 2005 constituted major share in NPAs of public sector banks. Priority sector-wise analysis of NPAs of individual public sector banks given in Table 7 and 8 shows that in 2001, Bank of Maharashtra had highest (64.53 percent) NPAs in priority sector of which agriculture constituted percent share while S.B. Travancore and Dena Bank had lowest share in NPAs in priority sector and agriculture (34.80 percent and 7.92 percent). In weaker section highest position is occupied by UCO Bank and lowest by OBC (having percent and 3.27 percent NPAs). Out of 27 public sector banks, 14 banks had more than percent (public sector average) of NPAs in priority sector. 13 banks in agriculture (above percent average) and 11 banks in weaker section (above percent average). In 2005, Indian Bank had percent of NPAs in priority sector, while OBC had only percent of NPAs. In agriculture, Punjab & Sind Bank occupied top position having percent of NPAs, while Indian Overseas occupied least position with 7.10 percent of NPAs. In weaker section, NPAs ranged between percent for Central Bank of India to 3.86 percent for S.B. Travancore. Of 27 public sector banks, 13 banks had more than percent of NPA in priority sector (public sector average); 8 banks in agriculture (above percent (average)); and 12 banks in weaker section (above percent (average)). (b) PRIVATE SECTOR BANKS Advances Table 9 and 10 shows that private sector banks witnessed an increase in priority sector advances. Of the various private banks considered, HDFC and ICICI have experienced 193

7 rapid increase in advances in priority sector as well as in agricultural advances, while Development Credit Bank in weaker section in 2005 as compared to HDFC and ICICI constitute and major share in advances in priority sector and agricultural advances in 2001 as well as in However, in weaker sections, Federal Bank, Jammu & Kashmir Bank in 2001 as well as in 2005 constitute major share. Other banks constituting major share in weaker section loan include Karnataka Bank in 2001 and ICICI bank in Private inter-bank analysis shows that in 2001, Nanital Bank occupied top position by deploying percent of credit in priority sector. In agriculture and weaker sector loans. Ganesh Bank remained at top position by deploying percent and percent of credit in these sectors (Position remained the same in 2005 of Nanital and Ganesh Bank). UTI Bank remained at bottom by deploying only 6.69 percent of credit in priority sector and 1.53 percent in agriculture; Development Credit Bank in weaker section by deploying only 0.08 percent credit. In 2005, Yes Bank ltd, Development Credit Bank Ltd. and Bank of Punjab remained at bottom by deploying only percent, 5.07 percent and 0.02 percent of NBC in priority sector, agriculture and weaker section loans. Regarding the targets fixed for priority sector loans, out of 31 banks, only 19 banks are fulfilling the target of 40 percent in 2001 as well as in In agricultural and weaker section loans, only one bank viz Ganesh Bank is fulfilling the target of 18 percent and 10 percent in 2001 as well as in NPAs Trends in NPAs of private sectors banks given in table 11 and 12 indicate that in priority sector and in weaker sections, NPAs of United Western Bank, Bharat Overseas Bank and of Kasur Vysya Bank, while in agricultural sector, NPAs of ICICI Bank IndusInd Bank and of UTI Bank increased rapidly in 2005 as compared to Regarding the contribution of various banks in private sector NPAs, Tables 11 and 12 show that South India Bank constituted major share in priority sector advances, while Jammu & Kashmir bank and Federal Bank in weaker section in 2001 as well as in Other banks including major share in priority sector NPA of private sector include Vysya Bank and Karnataka Bank in 2001 and Federal and United Western Bank in 2005; in agriculture section, Federal Bank and Visya and Karnataka bank in 2001 and Lord Krishna, ICICI bank and South India Bank in 2005; in weaker sections, Vsya Bank in 2001 and South India Bank in Private inter-bank analysis of NPAs given in Tables 11 and 12 show that Nanital Bank and Sangli Bank occupied top positions in NPAs in priority sector and in agricultural loans in 2001 and well as in In weaker section, IDBI bank was at top position in Centurion Bank and Development Credit Bank remained at bottom in priority sector and in weaker section NPAs in 2001 as well as in In agricultural NPAs, Indus bank in 2001, while Development Credit Bank in 2005 were at lowest position. Number of banks having more than private sector average in priority sector and in agriculture NPAs increased and in weaker section decreased in 2005 as compared to In 2001, out of 31 private sector, 17 banks had more than percent NPAs in priority sector, II bank more than 5.03 percent NPAs in agriculture sector while in 2005, 20 banks had above percent NPAs in priority 194

8 sector and 14 banks had above 5.29 percent NPAs in agriculture sector. In weaker section NPAs, 10 banks had more than percent NPAs, while in 2005, only 6 banks had more than percent NPAs. III Empirical results given in Table 13 show that for public sector banks, there existed very high correlation between advances and NPA in agriculture and between advances and NPAs in weaker section. Advances to agriculture and weaker sections in public sector banks significantly and positively affected NPA in agriculture and weaker section in 2001 as well as in 2005 while priority sector advances positively but insignificantly affected NPAs in 2001 as well as in For Private Sector, in 2001, there existed very low correlation between advances & NPAs in agriculture, between advances and NPAs in priority sector. In 2005, low correlation between advances and NPAs in weaker sections and between advances and NPAs in priority sector. Simple regression results indicate that in 2001, advances to agriculture, weaker section and priority sector significantly and positively affected NPAs in these sectors, while in 2005, only advances to agriculture significantly and positively affected NPAs in agriculture. For weaker sections, advances positively and insignificantly affected NPAs and in priority sector, advances negatively and insignificantly affected NPAs in these sectors. Thus the study reveals that priority sector advances significantly affected NPAs in public sector, while for private sector, advance in priority sector negatively and insignificantly affected NPAs. Thus efforts should be made for efficient recovery of priority sector loans. For this purpose, there should be proper selection of borrower. should ensure proper selection of the borrowers. should ensure proper end-use, proper post sanction follow up, regular contact with borrower, regular monitoring of the accounted and hold recovery camps. 195

9 Table 1 Gross and Net Non- performing assets of Scheduled Commercial Group-wise (Amount in Rs.Crore) Gross NPAs Bank Group Year Scheduled Commercia l 50,815 58,722 60,408 63,883 70, ,786 58,300 (a) Public Sector (b) All Private Sector (i) Old Private Sector (ii) New Private Sector 45,653 (89.84) 3,186 (6.26) 2,794 (5.49) 392 (0.77) 51,710 (88.05) 4,655 (7.92) 3,784 (6.44) 871 (1.48) 53,033 (87.79) 4,761 (7.88) 3,815 (6.31) 947 (1.57) 54,773 (85.73) 6039 (9.45) 4,420 (6.91) 1,619 (2.53) 9 56,473 (79.69) 11,662 (16.45) 4,851 (6.84) 6,811 (9.61) 54,090 (78.71) 11,782 (17.14) 4,550 (6.62) 7,232 (10.52) 51,538 (79.55) 10,354 (15.98) 4,393 (6.78) 5,961 (9.20) 47,325 (81.17) 8,782 (15.06) 4,206 (7.21) 4,576 (7.84) (c) Foreign 1,976 2,357 2,614 3,071 2,726 2,845 2,894 2,192

10 in India Scheduled Commercia l (a) Public Sector (b) All Private Sector (i) Old Private Sector (ii) New Private Sector (c) Foreign in India (3.88) (4.03) (4.33) (4.82) (3.84) (4.14) (4.46) (3.75) Net NPAs 23,761 28,020 30,073 32,468 35,554 32,671 24,615 21,441 21, ,8 1, , , 2, , , 2, , ,69 2,77 27, ,67 3, , , ,88 2,74 4,14 18, ,85 2,14 2,71 1 6, , 1, 2, 10

11 Source: RBI, Report on Trend and Progress of Banking in India (Various Issues) Note: Figures in parenthesis are percentage share. Scheduled Commercial (a) Public Sector (i)nationalised (ii)state Bank Group (b) Private Sector (i) Old Private Sector 98 Table 2 Percentage of Gross and Net NPAs to Total Assets of Scheduled Commercial Group-Wise 99 Gross NPAs to Total Assets YEAR Net NPAs to Total assets (ii) New

12 Private Sector (c) Foreign Source: RBI, Report on Trend and Progress of Banking in India (Various Issues) Scheduled Commercial (a) Public Sector (i)nationalise d (ii)state Bank Group (b) Private Sector Table 3 Percentage of Gross and Net NPAs to Advances of Scheduled Commercial Group-Wise Gross NPAs to Gross Advances YEAR Net NPAs to Net Advances (i) Old

13 Private Sector 1 (ii) New Private Sector (c) Foreign Source: RBI, Report on Trend and Progress of Banking in India (Various Issues) (i) Public Sector (2001) (2005) (a) Nationalised (2001) (2005) Table 4 Priority Sector-Wise Advances and Non-Performing Assets of Public and Private Sector (Percent) Advances Non-Performing Assets Agriculture Sector (% to NBC) Priority Sector (% to NBC) Weaker Sections (% to NBC) Agriculture Sector (% to Total) Priority Sector (% to Total) Weaker Sections (% to Total)

14 (b) State Bank Group (2001) (2005) (i) Private Sector (2001) (2005) (a) Old Private Sector (2001 ) (2005 ) (b) New Private Sector (2001 ) (2005 ) Source: RBI, Report on Trend and Progress of Banking in India (Various Issues) Table 5 Priority Sector-Wise Advances of Public Sector (2001) 14

15 Agriculture Sector Weaker Section Priority Sector Amount (Rs.Cr) % share of Bank % to NBC Amount (Rs.Cr) 15 % share of Bank % to NBC Amount (Rs.Cr) % share of Bank Allahabad Bank Andhra Bank Bank of Baroda Bank of India Bank of Maharashtra Canara Bank Central Bank of India Corporation Bank Dena Bank Indian Bank Indian Overseas Bank Oriental Bank of Commerce Punjab National Bank Punjab & Sind Bank Syndicate Bank Union Bank of India % to NBC

16 United Bank of India UCO Bank Vijaya Bank India Bikaner and Jaipur Hyderabad Indore Mysore Patiala Saurashtra Travancore Source: RBI, Report on Trend and Progress of Banking in India (2001) Table 6 Priority Sector-Wise Advances of Public Sector (2005) Agriculture Sector Weaker Section Priority Sector Amount (Rs.Cr) % share of Bank % to NBC Amount(Rs.Cr) % share 16 % to NBC Amount (Rs.Cr) % share of Bank % to NBC

17 of Bank Allahabad Bank Andhra Bank Bank of Baroda Bank of India Bank of Maharashtra Canara Bank Central Bank of India Corporation Bank Dena Bank Indian Bank Indian Overseas Bank Oriental Bank of Comm Punjab National Bank Punjab & Sind Bank Syndicate Bank Union Bank of India United Bank of India UCO Bank

18 Vijaya Bank India Bikaner and Jaipur Hyderabad Indore Mysore Patiala Saurashtra Travancore Source: RBI, Report on Trend and Progress of Banking in India (2005) Table 7 Priority Sector-Wise Non-Performing Assets of Public Sector (2001) Agriculture Sector Weaker Section Priority Sector 18

19 Amount (Rs.Cr) % share of Bank % to Total Amount (Rs.Cr) 19 % share of Bank % to Total Amount (Rs.Cr) % share of Bank % to Total Allahabad Bank Andhra Bank Bank of Baroda Bank of India Bank of Maharashtra Canara Bank Central Bank of India Corporation Bank Dena Bank Indian Bank Indian Overseas Bank Oriental Bank of Comm Punjab National Bank Punjab & Sind Bank Syndicate Bank Union Bank of India United Bank of India UCO Bank Vijaya Bank India

20 Bikaner and Jaipur Hyderabad Indore Mysore Patiala Saurashtra Travancore Source: RBI, Report on Trend and Progress of Banking in India (2001) Table 8 Priority Sector-Wise Non-Performing Assets of Public Sector (2005) Agriculture Sector Weaker Section Priority Sector Amount(Rs.Cr) % share of Bank % to Total Amount (Rs.Cr) 20 % share of Bank % to Total Amount(Rs.Cr) % share of Bank Allahabad Bank Andhra Bank Bank of Baroda Bank of India Bank of Maharashtra % to Total

21 Canara Bank Central Bank of India Corporation Bank Dena Bank Indian Bank Indian Overseas Bank Oriental Bank of Comm Punjab National Bank Punjab & Sind Bank Syndicate Bank Union Bank of India United Bank of India UCO Bank Vijaya Bank India Bikaner and Jaipur Hyderabad Indore

22 Mysore Patiala Saurashtra Travancore Source: RBI, Report on Trend and Progress of Banking in India (2005) Table 9 Priority Sector-wise Advances of Private Sector (2001) Agriculture Sector Weaker Section Priority Sector Amount(Rs.Cr) % share of Bank % to NBC 22 Amount (Rs.Cr) % share of Bank 6.3 % to NBC Amount(Rs.Cr) % share of Bank 3.1 Bank of Rajasthan 4.4 ltd Benaras State Bank Bharat Overseas Bank Cath. Syrian Bank ltd City Union Bank % to NBC

23 Ltd. Dev. Credit Bank Ltd Dhanalak. Bank Ltd Federal Bank Ltd Ganesh Bank Of Kurundwad Ltd J & K Bank Ltd Karnataka Bank Ltd Karur Vysya Bank Ltd Lakshmi Vilas Bank Ltd Lord Krishna Bank Ltd Nainital Bank Ltd Nedungadi Bank Ltd Ratnakar Bank Ltd Sangli Bank Ltd SBI Commercial & International Bank Ltd South Indian Bank

24 Ltd. Tamilnad Mer Bank Ltd Uni. Western Bank Ltd Vysya Bank Ltd Bank of Punjab Ltd Centurion Bank Ltd Global Trust Bank HDFC Bank ICICI Bank IDBI Bank IndusInd Bank Ltd UTI Bank Ltd Source: RBI, Report on Trend and Progress of Banking in India (2001) Table 10 Priority Sector-wise Advances of Private Sector (2005) Agriculture Sector Weaker Section Priority Sector Amount (Rs.Cr) Bank of Rajasthan ltd % share of Bank 1.59 % to NBC Amount (Rs.Cr) % share of Bank.002 % to NBC Amount(Rs.Cr) % share of Bank % to NBC

25 Bharat Overseas Bank Cath. Syrian Bank ltd City Union Bank Ltd Dev. Credit Bank Ltd Dhanalak. Bank Ltd Federal Bank Ltd Ganesh Bank Of Kurundwad Ltd ING Vysya Bank Ltd J & K Bank Ltd Karnataka Bank Ltd Karur Vysya Bank Ltd Lakshmi Vilas Bank Ltd Lord Krishna Bank Ltd Nainital Bank Ltd Ratnakar Bank Ltd Sangli Bank Ltd SBI Commercial &

26 International Bank Ltd. South Indian Bank Ltd Tamilnad Mer. Bank Ltd Uni. Western Bank Ltd Bank of Punjab Ltd Centurion Bank Ltd HDFC Bank Ltd ICICI Bank Ltd IDBI Bank Ltd IndusInd Bank Ltd Kotak Mahind. Bank Ltd UTI Bank Ltd Yes Bank Ltd Source: RBI, Report on Trend and Progress of Banking in India (2005) Table 11 Priority Sector-wise Non-Performing Assets of Private Sector (2001) Agriculture Sector Weaker Section Priority Sector Amount (Rs.Cr) % share of Bank % to Total Amount (Rs.Cr) 26 % share of % to Total Amount (Rs.Cr) % share of % to Total

27 Bank of Rajasthan Ltd Benaras State Bank Ltd Bharat Overseas Bank 2.46 Cath. Syrian Bank Ltd Bank City Union Bank Ltd Dev. Credit Bank Ltd Dhanalak. Bank Ltd Federal Bank Ltd Ganesh Bank Of Kurundwad Ltd J & K Bank Ltd Karnataka Bank Ltd Karur Vysya Bank Ltd Lakshmi Vilas Bank Ltd Lord Krishna Bank Ltd Nainital Bank Ltd Nedungadi Bank Ltd Ratnakar Bank Ltd Bank

28 Sangli Bank Ltd SBI Commercial & International Bank Ltd South Indian Bank Ltd Tamilnad Mer. Bank Ltd Uni. Western Bank Ltd Vysya Bank Ltd Bank of Punjab Ltd Centurion Bank Ltd Global Trust Bank HDFC Bank ICICI Bank IDBI Bank IndusInd Bank Ltd UTI Bank Ltd Source: RBI, Report on Trend and Progress of Banking in India (2005) Table 12 Priority Sector-wise Non-Performing Assets of Private Sector (2005) Agriculture Sector Weaker Section Priority Sector Amount % share of % to Amount % % to Total Amount % % to Total 28

29 (Rs.Cr) Bank Total (Rs.Cr) share of Bank Bank of Rajasthan ltd Bharat Overseas Bank Cath. Syrian Bank ltd (Rs.Cr) share of Bank 2.14 City Union Bank Ltd Dhanalak. Bank Ltd Federal Bank Ltd Ganesh Bank Of Kurundwad Ltd ING Vysya Bank Ltd J & K Bank Ltd Karnataka Bank Ltd Karur Vysya Bank Ltd Lakshmi Vilas Bank Ltd Lord Krishna Bank Ltd Nainital Bank Ltd Ratnakar Bank Ltd Sangli Bank Ltd

30 SBI Commercial & International Bank Ltd South Indian Bank Ltd Tamilnad Mer. Bank Ltd Uni. Western Bank Ltd Bank of Punjab Ltd Centurion Bank Ltd Dev.Credit Bank Ltd HDFC Bank Ltd ICICI Bank Ltd IndusInd Bank Ltd Kotak Mahindra Bank Ltd UTI Bank Ltd Yes Bank Ltd Source: RBI, Report on Trend and Progress of Banking in India (2005) Table 13 Results of Regression Analysis Year

31 Public Sector Private Sector 1. ; ; (6.86) (14.96) * (1.02) (3.28) * 2. ; 3. ; (0.92) (0.08) (-2.68) (19.3) * ; (-0.04) (6.42) * ; (1.64) (3.2)* Year 2005 Public Sector 1. ; (-2.3) (11.47)* 2. ; (-1.02) (24.9)* 3. ; (2.72) (2.26) Private Sector ; (3.06) (4.1)* ; (1.4) (1.25) ; (1.64) (-0.59)* Note : Xx = Advances in agriculture sector Yx = NPAs in agriculture sector Xy = Advances in weaker section Yy = NPAs in weaker section Xz = Advances in priority sector Yz = NPAs in priority sector 31

32 REFERENCES Reserve Bank of India, Report on Trend and Progress of Banking in India(various issues),rbi;mumbai. Reserve Bank of India, Report on Currency and Finance(various issues). Government of India,Economic Survey,