International Journal of Advanced Research and Development

Authors
Charu Garg

Abstract
The Indian banking sector has been facing serious problems of non -performing assets. The NPAs growth has a direct impact on profitability of banks. The incidence of Non- performing assets affects the performance of the credit institutions both financially and psychologically. Non -performing assets are one of the major concerns for commercial banks in India. Non- performing assets reflect the performance of banks. A high level of NPAs reflect large number of defaults that affect the profitability and net worth of banks. In addition it poses threat on quality of assets and survival of banks. NPAs are an inevitable burden on the banking industry, hence the success of a bank depends upon the method of managing NPA and keeping them within tolerance level. The recommendations of Narsimham committee and Verma Committee, some steps have been taken to solve the problem of old NPAs. In this paper an attempt is made to understand NPA factors contributing to NPAs, Reasons for high impact of NPAs on commercial bank in India.