Non-Performing Assets (NPAs) in Banks:Causes, Stress and Remedies

With the liberalization of economy, the banking industry is facing enormous challenges in the open financial market, probably it is also giving rise to non-performing assets (NPAs) in banks. The concept of bank nationalization was misutilised by a certain group of people in the name of liberalization, having directly contributing to swelling NPAs. The origin of the problem of NPAs also lies in the quality of credit risk management of banks. The increasing NPAs have a direct impact on banks profitability, causing concern and building up stress on management and the employees.

In this paper, an attempt has been made to focus on the potential factors / causes of NPAs, stress and their remedies by suggesting certain strategic approaches to provide an optimal level of stress environment to help in maintaining a balance in their different domains of work life.