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Abstract
A strong banking sector is important for flourishing economy. The failure of the banking sector may have an adverse impact on other sectors. Non-Performing Assets are one of the major concerns for banks in India.
NPAs reflect the performance of banks. A high level of NPAs suggests high probability of a large number of credit defaults that affect the profitability and net-worth of banks and also erodes the value of the asset. The NPA growth involves the necessity of provisions, which reduces the overall profits and shareholders’ value.