A Study On Risk Adjusted Performance Analysis of Bank Using Camel Model

This study evaluates the financial performance and relative soundness of ten selected Indian banks using an adapted CAMEL framework over a five-year period. The analysis focuses on capital adequacy, asset quality, management efficiency, earnings strength and liquidity to identify differences in the financial position of private- and public-sector banks. The findings reveal that Kotak Mahindra Bank achieved the highest composite CAMEL score, indicating the most balanced overall performance, while Axis Bank and IDBI Bank also recorded strong positions due to superior asset quality, deposit utilisation, capital adequacy and reserves. Union Bank of India ranked lowest over the study period, mainly because of weaker asset-quality indicators in the initial years, although several public-sector banks showed significant improvement in NPAs and capital strength. Private-sector banks generally recorded lower NPAs, stronger management-efficiency scores and higher reserves relative to assets, while SBI showed the strongest position under the investment-based liquidity measure. The Friedman test confirmed that differences in bank rankings were statistically significant. The study concludes that banks should strengthen capital buffers, improve credit appraisal and recovery systems, enhance digitalisation and risk management, diversify loan portfolios and use data analytics to support sustainable financial performance.