ASSESSING THE RISK: A CASE STUDY OF NON-PERFORMING ASSETS (NPAS) AT SBI BANK

The Indian banking sector plays a crucial role in economic growth through credit allocation and capital formation. Public Sector Banks (PSBs) dominate the market and contribute significantly to financial inclusion by funding infrastructure, rural development and priority sectors. However, the sector is challenged by rising Non-Performing Assets (NPAs), which negatively impact profitability, reduce lending capacity and erode investor confidence. NPAs have placed a considerable burden on management resources, highlighting the urgent need for effective strategies. Hence reforms are required to improve asset quality and ensure long-term financial stability with growth. The present research study comprehensively analyzed non-performing assets (NPAs) at the State Bank of India (SBI) from 2016 to 2025, aiming to assess NPA trends and their impact on financial performance. Employing a descriptive and analytical case study approach, the researcher has utilized secondary data and statistical methods including trend analysis, chi- square tests and ANOVA. Key findings indicate that both gross and net NPAs exhibited statistically insignificant variation post-2019, signifying a trend towards normalization. Furthermore, the Capital Adequacy Ratio and Provision Coverage Ratio demonstrated significant improvements, while the Return on Advances ratio did not show a statistically significant linear trend. The study concludes that SBI has effectively controlled its NPAs, bolstering its risk management practices and strengthening overall financial stability, largely attributed to internal reforms and external regulatory interventions.