A Study on Financial Performance of Selected Private Sector Banks in India- A Camel Approach

Abstract

Indian banking sector is invariably presumed to be one of the most important systems in the economy. Banking sectors are considered as the life blood of the Indian economy as they play an important and vital role in the economic activities. This study examines the overall performance of selected private sector banks using capital adequacy, asset quality, management effectiveness, earnings quality and liquidity level (CAMEL approach) over the period 2013-2022. Although profitability indicators (such as return on assets, return on equity and net profit margin) present the performance of selected private sector banks, it would be more appropriate to use the CAMEL Approach as a tool to assess overall performance. Because the performance of banks does not only depend on the level of NPAs or profitability, it is primarily based on various dimensions. To consider this point of view, the researchers adopted the CAMEL approach for this study to evaluate the overall financial performance of selected private sector banks.