"ANALYSIS OF THE ECONOMIC AND FINANCIAL PERFORMANCE OF PUBLIC SECTOR BANKS IN INDIA USING CAMEL RATING SYSTEM"

Abstract

The economic and financial performance of public sector banks (PSBs) in India is an essential component in determining the stability and expansion of the banking system in the country. This research examines the performance of public sector banks (PSBs) by utilising the CAMEL grading system, which is a framework that is recognised all over the world and assesses five important factors. These parameters include capital adequacy, asset quality, management efficiency, earnings, and liquidity. The purpose of this research is to give insights into the operational efficiency and financial health of public sector banks (PSBs), identifying strengths and shortcomings in order to assist improved decision-making and policy formation. For the purpose of analysing patterns and changes in performance, the research analyses PSBs over a certain time period by utilising secondary data obtained from annual reports, financial statements, and publications by the Reserve Bank of India (RBI). According to the most important results, even if certain public sector banks (PSBs) have strong capital adequacy and liquidity management, there are still difficulties in asset quality as a result of increasing non-performing assets (NPAs) and poor returns on investment. In addition, examination of management efficiency is carried out in order to locate deficiencies in operational procedures and governance structures. The recommendations that are included in the conclusion of the research are intended to improve the resilience and competitiveness of PSBs in an economic climate that is always changing. These insights may be utilised by policymakers, stakeholders, and bank management teams in order to execute strategic changes, which would ensure both sustainable growth and financial stability in the Indian banking system.