A Study on Impact of Non- Performing Assets Npaon Profitablity of Selected Private Sector Banks

The banking sector plays a vital role in the economic development of any country by facilitating financial intermediation and promoting investment. In recent years, Non-Performing Assets (NPAs) have emerged as a critical issue affecting the profitability and stability of banks in India. This study focuses on analyzing the impact of NPAs on the profitability of selected private sector banks. The research is based on secondary data collected from annual reports, RBI publications, and financial statements over a defined period. The study evaluates the relationship between NPAs and profitability indicators such as Return on Assets (ROA), Return on Equity (ROE), Net Interest Margin (NIM), and Net Profit Margin (NPM). Analytical tools such as trend analysis, correlation, and regression are used to assess the extent of the impact. The findings reveal a strong negative relationship between NPAs and profitability, indicating that an increase in NPAs significantly reduces bank performance. The study emphasizes the importance of effective credit risk management, regulatory compliance, and improved recovery mechanisms to enhance asset quality and profitability.