NON-PERFORMING ASSETS (NPA) TRENDS IN PRE VS POST-MERGER SCENARIOS OF INDIAN BANKS MERGED IN APRIL 2020

The merger of India's public sector banks (PSBs) in April 2020 marked a major step toward strengthening financial stability, enhancing operational efficiency, and improving credit governance within the banking sector.This study examines how Non-Performing Assets (NPAs) evolved in four leading PSBs-Punjab National Bank, Union Bank of India, Canara Bank, and Indian Bank-over a six-year period, encompassing three years before (FY2017-FY2019) and three years after (FY2021-FY2023) the merger.By employing Gross NPA (GNPA), Net NPA (NNPA), and Provision Coverage Ratio (PCR) as primary metrics, the study applies descriptive statistics, comparative trend analysis, and hypothesis testing to evaluate the mergers' effects on asset quality.The results reveal that while Gross NPAs experienced a moderate reduction, Net NPAs saw a significant decrease post-merger, indicating successful provisioning and recovery strategies.PCR showed considerable improvement across all banks, suggesting enhanced financial resilience and risk management.The study concludes that the mergers led to stronger balance sheets and improved asset quality, though the persistence of legacy stressed assets indicates that NPA resolution in India's PSBs remains a gradual, long-term process.