T Mohanasundaram, Anndal .


This research study observed the inducement of capital adequacy norms and asset quality review processes on the credit growth and profitability of Indian banks. The universal capital adequacy norms was initiated in India along with the national regulatory framework. Likewise, the central bank of the country Reserve Bank of India, imposed a strict asset quality review on Indian banks. These two policy measures brought a seesaw changes in the Indian banking sphere. The obvious questions are; do they affected credit growth and/or profitability of the country’s banks? If so, to what extent? – We addressed these research questions through empirical analysis. The study comprised sample of banks in different banking groups based on ownership viz., old generation private banks, new generation private banks, foreign banks and public sector banks for the period of fifteen years (2004 to 2018). The data for the study were compiled from Centre for Monitoring Indian Economy (CMIE) prowess IQ database and various reports of Reserve Bank of India. The result of the research study is likely to disclose whether the execution of capital adequacy norms affect the credit growth and introduction of asset quality review has adverse bearing on the profitability among the different banking groups.


Capital adequacy ratio, Asset quality review, Profit, Credit growth, Banks.


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