Assessing the Financial Performance of Private Sector Banks in India: An Empirical Analysis Based on the CAMEL Framework

Abstract: The current research does the financial analysis of the chosen banks in the private sector within India based on CAMEL measures within a decade of time, i.e. between 2015-16 and 2023-24. It is an assessment of five large private banks, which include HDFC Bank, ICICI bank, Axis bank, Kotak Mahindra bank and indusind bank. The secondary data were collected in the form of annual report and publication of the reserve bank of India. Ratio analysis has been used within the CAMEL framework of analysis, analysis of descriptive statistics, trends analysis, ranking methodology, the one way ANOVA and panel regression techniques. The results indicate that there is a high interbank variance in financial performance at the study period. The capital adequacy and the quality of the assets come out as key factors of financial stability and the earnings quality plays a key role in the indicators of profitability like Return on Assets (ROA) and Return on Equity (ROE). The results of panel regression show that Net Non-Performing Assets have a negative impact on the profitability, whereas Net Interest Margin and capital strength have a positive impact on the financial performance. The Hausman test can be concluded by Fixed Effects model which proves that bank-specific attributes produce substantial effects on profitability. In general, the research report provides a conclusion that banks of the private-sector that have stronger capital ratios, efficient management of credit risk, and reliable earnings performance are more financially stable and healthier, especially in times of economic stress like the NPA crisis and the COVID-19 pandemic. The results are significant to policymakers, regulators, and banking institutions to enhance the risk management approach and a sustainable expansion within the Indian banking industry of the private sector. Keywords: Financial Performance; Private Sector Banks; CAMEL Framework; Panel Regression; India. Title: Assessing the Financial Performance of Private Sector Banks in India: An Empirical Analysis Based on the CAMEL Framework Author: J.BANUPRIYA, Dr. K. NAINA MOHAMED International Journal of Management and Commerce Innovations ISSN 2348-7585 (Online) Vol. 13, Issue 2, October 2025 - March 2026 Page No: 597-606 Research Publish Journals Website: www.researchpublish.com Published Date: 03-March-2026 DOI: https://doi.org/10.5281/zenodo.18851350 Paper Download Link (Source) https://www.researchpublish.com/papers/assessing-the-financial-performance-of-private-sector-banks-in-india-an-empirical-analysis-based-on-the-camel-framework

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Zenodo (CERN European Organization for Nuclear Research)
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2026-03-03
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https://doi.org/10.5281/zenodo.18851350
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Innovations and Analysis in Business and Education
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article

Assessing the Financial Performance of Private Sector Banks in India: An Empirical Analysis Based on the CAMEL Framework

Dr. K. NAINA MOHAMED, J.BANUPRIYA
Zenodo (CERN European Organization for Nuclear Research)
Innovations and Analysis in Business and Education
article

Assessing the Financial Performance of Private Sector Banks in India: An Empirical Analysis Based on the CAMEL Framework

Dr. K. NAINA MOHAMED, J.BANUPRIYA
article en

Abstract

Abstract: The current research does the financial analysis of the chosen banks in the private sector within India based on CAMEL measures within a decade of time, i.e. between 2015-16 and 2023-24. It is an assessment of five large private banks, which include HDFC Bank, ICICI bank, Axis bank, Kotak Mahindra bank and indusind bank. The secondary data were collected in the form of annual report and publication of the reserve bank of India. Ratio analysis has been used within the CAMEL framework of analysis, analysis of descriptive statistics, trends analysis, ranking methodology, the one way ANOVA and panel regression techniques. The results indicate that there is a high interbank variance in financial performance at the study period. The capital adequacy and the quality of the assets come out as key factors of financial stability and the earnings quality plays a key role in the indicators of profitability like Return on Assets (ROA) and Return on Equity (ROE). The results of panel regression show that Net Non-Performing Assets have a negative impact on the profitability, whereas Net Interest Margin and capital strength have a positive impact on the financial performance. The Hausman test can be concluded by Fixed Effects model which proves that bank-specific attributes produce substantial effects on profitability. In general, the research report provides a conclusion that banks of the private-sector that have stronger capital ratios, efficient management of credit risk, and reliable earnings performance are more financially stable and healthier, especially in times of economic stress like the NPA crisis and the COVID-19 pandemic. The results are significant to policymakers, regulators, and banking institutions to enhance the risk management approach and a sustainable expansion within the Indian banking industry of the private sector. Keywords: Financial Performance; Private Sector Banks; CAMEL Framework; Panel Regression; India. Title: Assessing the Financial Performance of Private Sector Banks in India: An Empirical Analysis Based on the CAMEL Framework Author: J.BANUPRIYA, Dr. K. NAINA MOHAMED International Journal of Management and Commerce Innovations ISSN 2348-7585 (Online) Vol. 13, Issue 2, October 2025 - March 2026 Page No: 597-606 Research Publish Journals Website: www.researchpublish.com Published Date: 03-March-2026 DOI: https://doi.org/10.5281/zenodo.18851350 Paper Download Link (Source) https://www.researchpublish.com/papers/assessing-the-financial-performance-of-private-sector-banks-in-india-an-empirical-analysis-based-on-the-camel-framework

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