A Study on relationship between Return on Assets andNon-Performing Assets of Axis Bank and Union Bank

Abstract

Individuals, corporations, companies, and industrial concerns benefit greatly from commercial bank loans and advances. Bank funding plays a significant role in the expansion and diversification of corporate activity. Bank loans and advances assist businesses in satisfying their short-term and long-term financial needs. However, the process of lending entails a risk known as credit risk, which emerges from a borrower's failure. Loans that are at risk of default are referred to as non-performing assets. The loan amount is termed a "non-performing asset" The current study focuses on the management of nonperforming assets (NPAs) of Axis Bank and Union Bank. The main objective of the study is to find the relation between ROA and NPA’s and to recommend the banks through relationship banking model for improving the NPA status. Coefficient of correlation and T test are used to analyse and validate the data. The data collected for the study is from 2011 to 2021. The data is collected from the selected bank’s websites, blogs, international and national research publications. The conclusion is both the banks NPA’s are dissonant and there is a positive relationship between NPA’s and Banks ROA’s.