Journal Press India^®

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Purpose: An attempt has been made to identify the key determinants of profitability of Public Sector Banks in India. Design/Methodology/Approach: The analysis is based on step-wise multivariate regression model used on temporal data from 1991-92 to 2003-04. Findings: The study has brought out that the variables non-interest income, operating expenses, provision and contingencies and spread have significant relationship with net profits. Research Limitations: The factors affecting ‘Net Profit’ of each bank group can be calculated individually over a certain period of time. Managerial Implications: Control over non-performing assets, operating expenses, provision and contingencies are major areas of concern for the management of public sector banks. Originality/Values: Very scanty work has been done in past with the objective of identifying the determinants of profitability of banks in India.

Keywords

Indian Banking Sector, Banking Sector Reforms, Bank Profitability, Public Sector Banks

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