Published Online:October 2025
Product Name:The IUP Journal of Applied Economics
Product Type:Article
Product Code:IJAE031025
DOI:10.71329/IUPJAE/2025.24.4.38-55
Author Name:Sumeet Agarwal and Aditya Rai
Availability:YES
Subject/Domain:Economics
Download Format:PDF
Pages:38-55
This study analyzes the financial performance of private and public sector banks listed on Nifty Bank Index in terms of asset quality and profitability over a period of 10 years (2014-2023) using accounting ranking method and analysis of variance (ANOVA). Three private sector banks (HDFC Bank, Axis Bank, ICICI Bank) and three public sector banks (SBI, Bank of Baroda, Punjab National Bank) were selected based on their market capitalization. The findings reveal that private sector banks consistently outperformed public sector banks. ANOVA results confirmed statistically significant differences in asset quality and profitability between the two sectors. These results underscore the urgent need for public sector banks to enhance their risk management strategies, operational efficiency, and overall competitiveness in the banking sector.
The banking industry plays a vital role in shaping a country’s economy. Hence, banks’ financial health is of utmost importance, as it facilitates the flow of money, promotes savings, channelizes credit to individuals, businesses, and governments, and provides financial services to run the economy. After the 1990s, the Indian banking sector underwent a meaningful change. Private sector banks started evolving as the main players in the banking industry.