What does this research mean for the field?

Private sector banks in India demonstrate superior profitability and asset quality compared to public sector banks, and poor asset quality significantly reduces overall bank profitability. Novelty: ClaimNovelty.INCREMENTAL. Consensus alignment: ConsensusAlignment.NEUTRAL.

What question did this study set out to answer?

To evaluate and compare the financial performance of public and private sector banks in India across profitability, asset quality, and operational efficiency between fiscal years 2020–21 and 2024–25.

September 2, 2026Open Access

A Comparative Study of the Financial Performance of Public and Private Sector Banks in India: Evidence from Profitability, Asset Quality and Operational Efficiency

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To evaluate and compare the financial performance of public and private sector banks in India across profitability, asset quality, and operational efficiency between fiscal years 2020–21 and 2024–25.
Gathered secondary financial data from Reserve Bank of India publications spanning fiscal years 2020–21 to 2024–25.
Evaluated performance using Net Interest Margin (NIM), Gross Non-Performing Asset (GNPA) ratio, and Operating Expense Ratio.
Analyzed data utilizing descriptive statistics, Welch's t-test, Pearson correlation coefficients, and Ordinary Least Squares (OLS) regression models.
Private sector banks exhibited significantly higher Net Interest Margins and lower average GNPA ratios than public sector banks, although public sector banks demonstrated substantial improvements in asset quality across the study timeframe.
Correlation and regression analyses showed a statistically significant negative association between GNPA ratios and bank profitability metrics.

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Implication

Comparative analysis reveals higher interest margins and lower bad loans in private versus public banks, indicating that asset quality drives overall banking profitability.

Cite This Study

Dr.NAGARAJU J (2026) studied this question.

synapsesocial.com/papers/6a97e2d9c562ede874ec725a https://doi.org/10.5281/zenodo.22187380

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Implication

Comparative analysis reveals higher interest margins and lower bad loans in private versus public banks, indicating that asset quality drives overall banking profitability.

A Comparative Study of the Financial Performance of Public and Private Sector Banks in India: Evidence from Profitability, Asset Quality and Operational Efficiency

Key Points

Discussion

Implication

Cite This Study

A Comparative Study of the Financial Performance of Public and Private Sector Banks in India: Evidence from Profitability, Asset Quality and Operational Efficiency

Key Points

Discussion

Implication

Cite This Study

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