IMPACT Of BANK AND BRANCH SPECIFIC FACTORS ON MANAGEMENT OF NON PERFORMING ASSETS A STUDY ON PUBLIC AND PRIVATE SECTOR COMMERCIAL BANKS IN ODISHA

Abstract

Granting of credit for economic activities is the prime duty of banking. Apart from newlineraising resources through fresh deposits, borrowings and recycling of funds received newlineback from borrowers constitute a major part of funding credit dispensation activity. newlineLending is generally encouraged because it has the effect of funds being transferred newlinefrom the system for productive purposes, which results in economic growth. However, newlinelending also carries a risk called credit risk, which arises from the failure of borrower. newlineNon-recovery of loans and interest form a major hurdle in the process of credit cycle. newlineThus, these loan losses affect the bank s profitability on a large scale. Though complete newlineelimination of such losses is not possible, banks can always aim to keep the losses at a newlinelow level. newline