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Abstract

The progress indicators of an economy are banks. Banks have to face a lot of risks regarding their progress or performance such as risk of credit, risk of liquidity, market risk, risk of interest and risks of operations & management. Banks main function is lending to different sectors of the economy and generates income in the form of interest but it also puts a risk when their funds are stuck off and becomes NPA. In recent time there is tremendous growth in rising NPA and it becomes a severe problem for banks. The increasing problem of NPA not only affects the banks alone but also affects the economy and gives birth to problems like value erosion and degradation of asset quality. Other sectors of the economy also get adversely affected by the failure of banking sector.

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