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8/12/2019 project report of sbm
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”A STUDY ON NONPERFORMING ASSETS IN
STATE BANK OF MYSORE”
Project Guide:
Mrs. Neena Prasad
Asst. Professor
DSCE DOMS
Extern! Guide
Mr. Dinesh Ubar
Branch managerSBM
By:
Abhijna.P
eg No. !DSO"MBA#$
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"OMPANY PROFI#E
Founded : Mysore% !&!$ 'as Mysore ban()
$ed o%%ice : Banga*ore
Ke& (eo(!e : Managing Director P.P.Pattanaya(
Product) : *oans% credit cards% sa+ings.
S!o*n : ,or(ing for better tomorro,
Indu)tr& : ban(ing% ins-rance and a**ied ind-stries
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NPA : NON+PERFORMING ASSET
Meaning:
An asset% inc*-ding a *eased asset% becomesnonerforming ,hen it ceases to generate incomefor the ban(.
A NPA is a *oan or an ad+ance ,here /nterest
and0 or insta**ment of rincia* remain o+erd-e fora eriod of more than &# days in resect of a term*oan.
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INTRODU"TION
OB,E"TI-E OF T$E STUDY:
2o ana*y3e the NPA and its re*ation ,ith oerating
rofit of the ban(.
2o st-dy the genera* reasons for assets become NPAs.
2o oint o-t the amo-nt of NPAs in SBM.4hat is the criteria to reco+er the ad+ances from the
ban(.
4hat are the methods adoted by the ban( to *oo(after NPA management.
Sco(e o% t.i) )tud&: 2o resent a ict-re of mo+ement of NPA in SBM. 2o (no, ho, NPA *e+e* ,i** affect the rofit of the
ban(.
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RESEAR"$ DESIGN
Stte/ent o% (ro0!e/: 2he ban( ,i** a*,ays face the rob*em of NPA
beca-se of oor reco+ery of ad+ances granted by theban( and se+era* other reasons *i(e adoting a oorreco+ery strategies so ,hen the *oan is not reco+eredfrom the ban( effecti+e*y and efficient*y that ba*ance
amo-nt ,i** become the NPA to the ban( it may createsome h-ge rob*em to the ban(5s net rofit.
2he st-dy com*ete*y deends on the )econdr&dt.
2he secondary data co**ected from 6 SBM5s ann-a* reorts. B/5s Ann-a* reorts. SBM5s 7-arter*y b-**etins. SBM5s ,ebsite.
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ANA#YSIS
Ite/)1223+24
1224+25
1225+26
1226+27(rojected
Gro)) NPA!e8e! 976;9 96954 954 994O(ertin*
(ro%it <96 <5;36 3;3 51;
In%erence:
8rom the chart%
it is -nderstoodthat as the grossNPA *e+e* starteddecreasing inrecent year%oerating rofitstarted increasingdrastica**y.
Gro)) NPA 8=) O(ertin* (ro%it
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"ORRE#ATION TEST
Gross NPA
Operating
profit
Gross NPA Pearson Correlation 1 -.992(**)
Sig. (2-tailed) .008
N
Operating
Profit
Pearson Correlation -.992(**) 1
Sig. (2-tailed).008
N
INFEREN"E:
2here is a negati+e corre*ation e9ists bet,een gross NPA of a
ban( ,ith oerating rofit at a #.#! *e+e* significance. So !is acceted% ,hich states there is a significant re*ationshibet,een gross NPA of a ban( to its oerating rofit.
HYPOTHESIS H0: There is no significant relationship between gross NPA of a bank to its
operating profit.
H1: There is a significant relationship between gross NPA of a bank to its
operating profit.
** Correlation is significant at the 0.01 level (2-tailed).
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RE"ENT YEAR NPA PERFORMAN"E"$ART
Stte 0n>o% M&)ore
1229+2<
122<+23
1223+24
1224+25
1225+26
Grou(8er*e1225+26
A!!
0n> )8er*e1225+26
Net NPArtio ;.&< #.&; #."= #.=> #.=$ !.=$ !
In%erence:
/n recent
years Net NPAratio has comedo,n drastica**y%,hich is +ery
m-ch be*o, thestandard *e+e* of!% ,hich is +eryfa+orab*e for theban(.
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"OMPARISON ?IT$ OT$ER GROUPBANKS
In%erence:
Comared to
a** other gro-ban(s SBM is ingood osition,ith #.=$ NPAratio.
SBM
SBI &
its associates
nationalised
banks
Foreign
banks
All
banks
Net NPA
Ratio 0!" #!" 0$$ 0$% #
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SE?MEN2 4/SE POS/2/ON O8 NPAS
Segent Position
as '00$
Red(ctio
ns d(ring
t)e *ear
Addition
s d(ring
t)e *ear
Position
as '00%
Ind(str* #!#"% #'!$% +,,! ##'#!
Trade ''$+ #"0' #!"" '!#0
SSI !,0% #,%$ %'% "$!+
SBF !$-# '0'0 #%#! !,,,
A.R "%'" #+-$ ##-% "0'!
Personal %!,' "-$! -#$0 #0+!%
Misc !#, !#, / /
TOTA "%"$- '"!!" '0+-$ ",+00
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FINDINGS 2he ban( has achie+ed its target beca-se the net
rofit is a*so increased and there is a decrease inNPAs. So it is in better osition comared to *ast year.
2he tota* NPA is $"< crore% *ast year it ,as $@$."<
crore.
2he *oans and ad+ances ha+e been increased from;##<#" to ;##"#@
2here is decrease in do-btf-* assets comared to *astyear.
2here is a s*ight decrease in OA b-t there is a s*ight
increase in OE.
SUGGESTIONS AND
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SUGGESTIONS ANDRE"OMMENDATIONS
Effecti+e insection system sho-*d beim*emented.
Oerating staff sho-*d scr-tini3e the *e+e* ofin+entories0recei+ab*es reg-*ar*y.
arge e9os-re on big cororate or sing*e rojectsho-*d be a+oided.
Une+en sca*e of reayment sched-*e ,ith higherreayment in the initia* years norma**y isreferred.
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"ON"#USION
/t is not ossib*e to e*iminate tota**y the NPAs in the ban(ingb-siness b-t can on*y be minimi3ed. /t is a*,ays ,ise itfo**o, the roer o*icy araisa*% s-er+ision and fo**o,-of ad+ances to a+oid NPAs.
2he ban(s sho-*d not on*y ta(e stes for red-cing resentNPAs% b-t necessary reca-tion sho-*d a*so be ta(en toa+oid f-t-re NPAs.
B-t in the case of SBM it is one of the good sign that the
amo-nt of NPA is decreased from *ast financia* year and itsho-*d be mo+e *i(e this in f-t-re.
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REFEREN"E
Stte Bn> o% M&)ore
Ann-a* reorts
Other circ-*ars
Re)er8e Bn> o% IndiAnn-a* reorts
NPA circ-*ars
Internet )ource): ,,,.rbi.org.in ,,,.eeaecon.org ,,,.thehind-b-siness*ine.co ,,,.icai.org ,,,.stateban(ofmysore.co.in
Boo>) nd rtic!e): Ban( Management: 2imothy
4. och
Ban(ing theory and ractice:
.C.She(har SBM: Po*icy g-ide*ines ;##@
#&
B-siness ,or*d maga3ine
Ne,s aer artic*es
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2han( o-.F