The analysis focuses on the earnings of state-owned commercial banks in India concerning high-risk investments.

Title

The analysis focuses on the earnings of state-owned commercial banks in India concerning high-risk investments.

Author

1. Santosh Nair, Student, Gauhati University, Guwahati ,India, India

Abstract

The current research looks at how asset risk affects the bottom lines of government-owned banks. The results reveal that asset risk significantly impacts commercial bankers' bottom lines. Net profits for commercial banks tend to decrease when asset risk is included. Twelve commercial banks are in the public sector, but only five have been chosen for their convenient locations. The years 2005-2006 through 2018-2019 are included in the analysis.

Keywords

Conclusion

The overall analysis of the examined banks highlights poor recovery efforts. During the period under review, they witnessed a significant surge in defaults, resulting in heightened asset risk for financial institutions. Urgent action is required to ensure banks' solvency due to the adverse impact of asset risk on profitability. To increase profits, banks should employ innovative strategies to recover funds from dormant, lost, and written-off accounts. Approving loans only after comprehensive due diligence, including assessing applicants' credit history, creditworthiness, and collateral condition, can enhance banks' ability to recover funds in case of default.

Author Contrubution

The author confirms sole responsibility for the following: study conception and design, data collection, analysis and interpretation of results, and manuscript preparation.

Funding

The authors did not receive any specific grants from funding agencies in the public, commercial, or non-profit sectors for the research, authorship, and/or publication of this article.

Conflict of Interest

All authors declare that they have no conflicts of interest.

Data Sharing Statement

Not applicable

Software And Tools Use

Not applicable

Acknowledgements

I thank the following individuals for their expertise and assistance in all aspects of our study and for their help in writing the manuscript. I am also grateful for the insightful comments given by anonymous peer reviewers. Everyone's generosity and expertise have improved this study in myriad ways and saved me from many errors.